Harley-Davidson announced its accelerated growth strategy that will expand its ridership to 4 million riders in the United States by 2027 from 3 million in 2017, but the strategy will require significant investment.
The company’s ‘More Roads to Harley-Davidson’ strategy is planning to leverage its brand and deeper consumer insights to bolster the existing growth catalysts of new products, broader access, and stronger dealers. The initiative is expected to generate “more than $1 billion” in annual revenue in 2022. In 2018, the company said its new sales strategy was expected to generate up to $1.5 billion in additional revenue by 2022.
The strategy will require “significant investment,” which the company expects to fund entirely through cost cuts and the reallocation of investment and resources. The company expects operating investment of $450 million to $550 million through 2022 and capital investment of $225 million to $275 million.
Outside the United States, Harley plans to grow international business to 50% of annual revenue. The growth target was previously motorcycle unit volume, which was not inclusive of all of the company’s efforts to grow internationally, including electric-powered two-wheelers for kids, eBicycles, and apparel.
The company also expects to launch a fully electric LiveWire model this year as well as more middleweight motorcycles.
“We’re on a quest to build the next generation of Harley-Davidson riders,” president and CEO Matt Levatich said. “We are activating our refined plan with focus and intensity to create new pathways to Harley-Davidson and expand access and appeal to more people around the world.”
Investors aren’t sold on the plan just yet. On Tuesday afternoon, shares of Harley-Davidson were selling at $34.05, down $1.36, or 3.8 %, with an open of $35.71, a high of $36.88, and a low of $34.03.