Like the auto industry, the motorcycle industry has been turned upside down by the electric revolution. Harley-Davidson attempted to hold off a slew of electric motorcycle startups by bringing out the LiveWire motorcycle.
The LiveWire motorcycle clashed with the traditional Harley-Davidson buyers in many ways and to most followers of the motorcycle industry this was a young versus old battle. Millennials embracing electric motorcycles while baby boomers in their final years embracing the HOG.
Harley-Davidson for the last few years struggled with getting a price and feature competitive electric motorcycle out. The original Livewire motorcycle was considered too expensive and not enough range for the price.
In 2018, we here at Cheers and Gears covered the Reveal of the Harley-Davidson Livewire motorcycle.
Harley-Davidson felt people would be willing to pay $30,000 for an electric motorcycle that only had 100 miles of range and fell to around 75 miles of range with highway riding. Yet in January one of the oldest startups brought out another electric motorcycle that has received rave reviews as an entry level electric motorcycle at $13,000 starting price and a range of 150 miles highway.
Lighting Motorcycles has been leading the revolution in electric motorcycles.
With dismal sales, a clash between cultures, and then worse yet, financial decline since 2008 with plunging sales, Harley-Davidson has been hit hard. A decade of fewer models, in the red financially, fewer markets that can support their high price, this then led to the Pandemic of 2020-2022 with firing of hundreds of employees and the firing and hiring of a new CEO Jochen Zeitz.
The new CEO Jochen Zeitz realized that with an aging conservative clientele and little success with young motorcyclists that a radical change had to take place. This was put into their future roadmap as Harley-Davidson needed to expand their portfolio of models to include smaller displacement classes that are in demand in Asia, especially with a demand from e-bikes to electric motorcycles.
To achieve this change, it would require large investment of capital, something Harley-Davidson had in short supply. This was then complicated with a trade dispute with the European Union which hurt the American made motorcycles further straining the balance sheet of the company. Worse yet with the global Covid-19 lockdowns, Harley-Davidson saw a year over year drop in sales by 53%, going from a profit of $181 million in 2019 to a loss of $121 million in 2020. 2021 was not much better for motorcycle sales globally.
Harley new CEO, Jochen Zeitz announced a new five-year plan that would take immediate effect in 2021 and with it a new brand ambassador, Jason Mamoa. The Pandemic years saw a financial restructuring, reduction of American employees, building of motorcycles overseas for the European market and Asian rim to deal with the trade dispute and a move of the Harley manufacturing in the U.S.
All total, over 700 employees have been laid off, considerable consolidation and optimization of the current structure along with a $150 million dollar loan in 2021. These changes while helping to slow things down have not reversed the fortunes of Harley nor have, they brought in the new younger generations. As such, Harley did the next logical step, spun off as a separate motorcycle company the electric motorcycle division and gave birth to LiveWire Motorcycles.
Focused on the young generations of new electric motorcycle riders, LiveWire has their initial motorcycle called the LiveWire ONE with a starting price of $22,799 and a range of 146 miles city, 95 miles combined.
There is then the S2 Del Mar electric motorcycle with a 110-mile range city and a starting price of $16,999.
Per LiveWire News release, the S2 Del Mar electric motorcycle sold out first year's production in 18 minutes having the company point to pent up demand for clean, emission free motorcycles.
LiveWire went live as a publicly traded company on September 27th under the ticker "LVWR". They are the first EV motorcycle company to be listed on the NYSE. The stock raised $334 million in gross proceeds to help fund LiveWire as it starts building and delivering electric motorcycles.
Harley-Davidson as a publicly traded company under the ticker "HOG" holds considerable stock in LiveWire and their CEO Jochen Zeitz is both Chairman and CEO of Harley-Davidson and LiveWire. This transaction freed up resources for Harley to reinvigorate their own identity and brand of ICE motorcycles worldwide while also funding the growth of the electric motorcycle under its own identity.
It would appear that Harley-Davidson took a page out of the Ford Motor Company playbook in separating the ICE from the EV and as global sales change in one or the other will allow the board and executives to survive as one company grows and another declines. The future looks bright for LiveWire and very interesting for Harley-Davidson.
Harley has reinvigorated their product line which one can check out here: Shop Harley-Davidson Motorcycles | Harley-Davidson USA
LiveWire is clearly focusing on the youthful future electric motorcycle riders and their products can be looked at here: LiveWire Electric Motorcycles | Home
One thing that the new Chairman and CEO felt was underutilized was apparel, parts and cross merchandising sales. Here one can find plenty to shop for on both websites depending on ones interest in supporting ICE or Electric Motorcycles and the brands they represent.