Harley-Davidson will keep Production in Wisconsin

Milwaukee Biz Journal

 

Harley-Davidson Inc. said Tuesday that it will keep production operations in Wisconsin, following Monday's contract votes by the company's Wisconsin unionized employees.

Unions representing Harley-Davidson production workers in Menomonee Falls and Tomahawk ratified three new seven-year labor contracts. All three will take effect in April 2012 when the current contracts expire.

The contracts include a number of concessions, including a wage freeze and work force reductions in both Menomonee Falls and Tomahawk. In all about 325 full-time employees will be cut, with seasonal demand to be picked up by seasonal workers.

Based on the new ratified labor agreements, the Milwaukee-based motorcycle manufacturer expects to have about 700 full-time hourly unionized employees in its Milwaukee-area facilities when the contracts are implemented in 2012, about 250 fewer than would be required under the existing contract. In Tomahawk, the company expects to have a full-time hourly unionized workforce of about 200 when the contract is implemented, about 75 fewer than would be required under the current contract. The contract will allow for 150 to 250 seasonal employees to cover seasonal volume spikes, vacations and other absences.

Full-time hourly employees will be moved to the same health benefits plan that salaried employees have and will keep a non-contributory defined benefit pension plan at current benefit levels funded entirely by the company.

"Change is never easy, and we have asked our employees to make difficult decisions. However, we are pleased to be keeping production operations in our hometown of Milwaukee and in Tomahawk," said Keith Wandell, president and CEO. "Together, we are making the necessary changes across our entire company to succeed in a competitive, global marketplace while continuing to meet and exceed the expectations of our customers."

The company said the new contracts are expected to generate about $50 million in annual operating savings in 2013, the first full year of the agreements.Halrey expects about $85 million in new restructuring charges becuase of the contracts through 2012. About $55 million will be cash charges.

When fully implemented, Harley-Davidson (NYSE: HOG) expects previously announced restructuring activities, together with the implementation of the new contracts at the Wisconsin operations, to result in one-time charges of $515 million to $545 million, and annual ongoing savings of $290 million to $310 million. In 2010 on a combined basis, Harley-Davidson expects to incur restructuring charges of $225 million to $245 million and to generate related savings of approximately $135 million to $155 million.

Triumph Rides High as U.K. Bestseller takes on Harley Davidson

Guardian UK

 

Triumph Motorcycles has ridden the recovery in UK manufacturing to a victory over key rival Honda and is now setting its sights on American adversary Harley-Davidson.

The Leicestershire-based bike maker has revealed that booming sales in April made its brand the best-selling in Britain in the over-500cc sector, overtaking Honda. It wants to make that ranking permanent this year as it continues to increase its market share following record UK sales in 2009.

Chairman Lord Digby Jones says part of the boost has come from a strong yen, which has raised the prices of Japanese rivals in the UK market.

While the recession knocked back overall sales of new motorcycles and Harley Davidson motorcycle batteries by 20% in Britain last year, UK motorcycle production actually grew, according to the Motor Cycle Industry Association.

But beyond currency effects Jones also cites Triumph's strong brand, new products and a big push at domestic and overseas sales. Of the 46,000 bikes Triumph will make this year, just 9,000 will be sold in Britain.

"We really want to get hold of America," said Jones, former head of industry group the CBI. "We have launched the Thunderbird straight into the middle of Harley-Davidson's market and it has just been voted bike of the year in America, right in Harley-Davidson's backyard," he adds, referring to an award from a US magazine.

Twenty years since resurfacing from receivership, the manufacturer also has its eye on more sales in the Gulf, where the Prince of Bahrain has a Triumph, as well as in Asia more generally.

In Britain it is launching a string of upmarket dealerships, including one this month on home turf in Leicester.

"What we want to do is make Triumph number one in the UK market, year in, year out," says Jones.

Harley-Davidson Reports First Loss In 16 Years

NY Times

Harley-Davidson, the motorcycle maker, reported a fourth-quarter loss Friday, its first quarterly shortfall in 16 years, hurt by restructuring costs and the sluggish economy. Harley-Davidson has come under pressure over the last year as the tight credit markets and the weak economy led consumers to shun purchases of its high-end, heavyweight motorcycles. The company has been reorganizing its business through layoffs, factory closures and closing or selling unwanted brands.

Harley said shipments of its bikes to dealers in 2009 fell 27 percent, to 223,023. For 2010, Harley said it expects shipments to fall another 5 to 10 percent to 201,000 to 212,000 motorcycles. Harley-Davidson said it lost $218.7 million, or 94 cents a share, during the fourth quarter. That marks its first three-month loss since the fourth quarter of 1993 and contrasts with a profit of $77.8 million, or 34 cents a share, a year ago. Revenue tumbled 40 percent, to $764.5 million from $1.28 billion a year ago.