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Pressured By Investors, External Tariffs And Financial Losses, Harley-Davidson Faces Resignations In Leadership And Tries To Withstand The Biggest Crisis In Its Recent History
Harley-Davidson is facing one of the biggest crises in its recent history. The American motorcycle manufacturer saw its revenue drop by more than 60% in 2024, according to its annual report. The decline triggered a series of events that put the company in the spotlight, including the departure of key leaders and increasing pressure for internal changes.
Impact Of Tariffs And Resignations On Harley Leadership
The first impact came with the tariffs imposed by Donald Trump, which directly affected the competitiveness of motorcycles produced in the United States.
Following this, CEO Jochen Zeitz announced his resignation amid growing challenges. Shortly thereafter, another director of the company also left the position, citing “serious concerns” about the situation.
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Now, H Partners, Harley-Davidson’s second-largest shareholder, is preparing to remove three members of the board of directors.
The group holds about 9% of the company’s shares and intends to launch a campaign to suspend the votes of Zeitz, Thomas Linebarger, and Sara Levinson, who together have more than 60 years on the board.
Price Increases And Investor Impatience
The move comes shortly after Harley-Davidson announced the increase in motorcycle prices. The company justified the adjustment based on the 56% tariffs applied to American motorcycles exported to Europe. This measure heightened tensions among investors.
Despite Jochen Zeitz planning to remain in office until a new CEO arrives, H Partners expressed dissatisfaction with the pace of changes. The group wants Zeitz to leave immediately, having taken leadership in 2020, at the peak of a challenging phase for the company.
The internal crisis deepened with the resignation of Jared Dourdeville, H Partners’ representative on the board. In a letter, Dourdeville criticized the remote work adopted by Harley-Davidson and mentioned “cultural burnout” caused by the departure of senior executives.
Harley’s Difficulty In Competing With Foreign Rivals
Chief Financial Officer Jonathan Root advocated for greater support for American automakers. According to him, foreign manufacturers sell motorcycles at very low prices in the United States, making competition difficult for companies like Harley.
Many of the brand’s motorcycles, even when produced outside the U.S., are still seen as excessively expensive in the domestic market.
In addition to American tariffs, other countries have applied retaliatory measures. Products made in the U.S., including Harley-Davidson motorcycles, have become targets for additional taxes.
The Wall Street Journal warned that prices for some models could reach six-digit values if taxes are maintained.
Recent History Of Losses And Alternative Strategies
The current scenario is reminiscent of what the company experienced in 2018, during Donald Trump’s first term. At that time, a trade war involving metals resulted in a 25% tariff on Harley-Davidson motorcycles.
To face the situation, the company had to absorb a loss of US$ 166 million over three years and build a factory in Thailand.
The situation is particularly delicate for a brand with the prestige and tradition of Harley-Davidson. Meanwhile, competitors like Triumph, BMW, and Honda continue to report positive results.
These brands have been heavily investing in small and medium-sized motorcycles, a segment that is gaining more and more ground in the market.
Harley, on the other hand, continues to focus on large, heavy, and expensive models. Although recognized as classics, these models no longer meet the preferences of many modern motorcyclists. The company even had the chance to launch the entry-level 350 in the United States but has not yet done so.
The Future Requires Adaptation
With the growing demand for motorcycles below 1000 cc, the absence of more accessible models may further harm Harley-Davidson’s position. The company needs to adapt to changes in consumer behavior if it wants to maintain relevance in the market.
The reorganization of the board proposed by investors may be the first step. However, challenges remain. For many, watching one of the most traditional brands in the industry navigate such a critical phase is concerning.
With information from New Atlas.
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