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Spending on big-ticket purchases has slipped, with consumers wary of depleting savings and rising credit card debt, dashing hopes of a recovery in demand for manufacturers of leisure products.
“We have worked diligently through the quarter to mitigate the impact of high interest rates, and macroeconomic and political uncertainty, that continue to put pressure on our industry and customers, especially in our core markets,” Harley CEO Jochen Zeitz said.
Harley’s retail sales in North America, its biggest market, fell 10%.
Amid a slump in demand, the company focused on selling more of its lucrative Touring bike models helping it beat third-quarter profit estimates.
In July, Harley said it would pare back motorcycle shipments in the second half of this year to bring them in line with retail sales. The company said on Thursday it now expects full-year global shipments to be down 16% to 17%, compared with its prior forecast of down 7% to 10%. Harley also forecast annual retail sales to be down 6% to 8%. Previously it expected sales to be flat to up 3%.
“Given these continued soft retail trends, as expected HOG reduced its 2024 guidance once again, though the magnitude was a bit greater than we anticipated,” Raymond James analyst Joseph Altobello said.
Harley reported a third-quarter profit of 91 cents per share, compared with the average analyst estimate of 79 cents, according to data compiled by LSEG.
The company now expects 2024 revenue from motorcycles and related products to be down 14% to 16%, compared with its prior forecast of down 5% to 9%.
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