Offer chain difficulties are forcing Harley-Davidson to suspend producing and shipments of most of its cars for two months, a transfer impacting the company’s Menomonee Falls plant.
The Milwaukee-dependent enterprise declared the go in a push launch Thursday early morning.
“This conclusion, taken out of an abundance of warning, is dependent on information and facts furnished by a third-social gathering provider to Harley-Davidson late on Tuesday about a regulatory compliance subject relating to the supplier’s part element,” the release reads.
It is the most current in a sequence of issues that have plagued manufacturing and the international supply chain considering the fact that the onset of the COVID-19 pandemic.
In its to start with quarter economical benefits final thirty day period, Harley-Davidson pointed out the impacts of “semi-conductor troubles” and creation shortages on its margins and sales. North American motorbike product sales were being down 5 p.c from 2021 to 2022, with the enterprise indicating sellers experienced a lot lower stock simply because of the shortages.
Harley CEO Jochen Zeitz claimed on an April 27 earnings phone the enterprise anticipated source worries would continue on to have an affect on the sector.
“We are cautiously optimistic on enhancements to the offer chain natural environment in the 2nd fifty percent of the yr,” Zeitz stated. “Having said that, this stays tough to predict with certainty.”
Gina Goetter, the company’s CFO, said on the April earnings connect with the company’s bikes were being, on average, sitting on showroom floors for much less than two weeks, down from about 10 months in the very first quarter of 2019.
“We have not noticed any of the existing acute troubles in inflation that are hitting customers impacting our need,” Goetter stated. “The major factor that impacted our shipments in Q1 was our means to generate to the demand from customers, so it was not a slowdown in any perception of the creativeness.”
The business initiated a strategic strategy to revamp its revenue early very last year in the wake of pandemic earnings declines. Zeitz reported at the time the firm had “above-dedicated and less than-shipped” in the past.
Harley stocks were trading all over $32.60 a share as of 10:20 a.m. Thursday. The company’s stock has misplaced all over 20 percent of its benefit in the last thirty day period.
LiveWire, the firm’s electric motor vehicle division, is not affected by the pause in creation.