In case you missed it, another Harley-Davidson franchise went under last week. Millville Harley-Davidson in New Jersey closed two stores, one in Millville and the other in Wildwood, without notice.
Customers were very surprised. “The thing is, I talked to them Friday or Thursday and they never let anybody know anything,” a customer named Kenny Colon told NBC News in Atlantic City last Monday. Colon was there to pick up his motorcycle. “It sucks man, like a swift kick in the you-know-what. I’m not playing no games. I just want my bike. I don’t want none of their business.”
Wildwood is an old beach town. Millville is surrounded by what was once “South Philadelphia in the summertime.” It is May. It is eighty-five degrees at the beach in Los Angeles so how bad can it be in South Jersey? This is riding weather. And Harley-Davidson actually announced a little profit at the end of April. And then there is that Harley advertising slogan, “Screw it. Let’s ride.”
April 20th, Harley Supreme Overlord Keith Wandell “tempered” that optimism, as financial reporters like to say. “Given the global economic uncertainty that still exists,” Wandell announced, “we believe conditions will remain challenging throughout this year, and we will continue to factor that into how we manage the business.” Not exactly “screw it,” is it? Weasel wolfing like that may or may not be part of the problem.
New Improved Harley Slim
What Wandell expects everyone to know without forcing him to say it is that Harley profits are 72 percent lower this year than they were last year. Harley sales are 21 percent lower this year which is kind of bad for people who sell motorcycles and for people who build motorcycles.
“I wish to God I could stand in front of everybody and say that you’re going to be guaranteed a job for life,” Wandell told shareholders last month. “We’d all be great friends and pat each other on the back and walk into the sunset together. You know what? Life isn’t that simple.” Then getting really carried away with himself Wandell promised, “I will come to work every day, roll up my sleeves, work next to you on the line, whatever has to happen to ensure that we are a great company. But I’m not going to tell people something that isn’t true.”
What is true is that Harley is now threatening to move manufacturing out of Wisconsin. Harley ran this same number on Pennsylvania a few months ago. The problem in Wisconsin is the same problem Harley had in Pennsylvania. Workers just want too darn much money.
On the other hand, looking at the bright side, Harley is turning a profit so the value of its stock is up. And while it is true that Wandell’s salary is a mere $981,000, and that last year he earned only $1.25 million in bonuses, it is also true that he has managed to acquire about $6.2 million in Harley stock in the last year. And every time he makes one of those hard decisions the value of that stock goes up just a little bit more.
Meanwhile In Jersey
The hard choices Wandell has “had to make” include shrinking the company to raise the profits and to inflate the value of the stock. It is not just Wandell who has to make hard choices. Other people do, too. Like Sam Macrine. Macrine is the guy who opened Millville Harley-Davison in 1975.
“I just can’t continue to operate,” Macrine told Anthony Bellano of the Bridgeton News. “For the past couple of years, everyone’s been suffering. Nationally, Harley is down. It’s getting harder to operate.”
Macrine promised that customers like Colon, “with bikes still in our store will be able to pick them up. I wouldn’t do anything to hurt anyone.” Then he told the News, “Employees were crying and they were broken-hearted. This was the hardest decision I’ve ever had to make…. This week, I went over the books and all the numbers, and I decided I can’t continue. I couldn’t continue to pay all the employees and manage a store…no one’s spending money like they used to spend.”
About a week ago, just about the time Millville Harley was turning out the lights, Wandell was reported to have said that because Harley has to contend “with an aging customer base and overseas competition” the “bigger opportunities” for the company “may lie overseas.”
It is shame Harley-Davidson didn’t hire a Supreme Overlord who actually gets it. Instead Harley hired this Wandell guy.