I just got a text message from my nephew who works at the Harley facility up north. Come the end of September, he’s one of the approximately 400 who will be laid off, so that made this story on the local NBC affiliates website a few minutes later a little less of a shock.
Harley-Davidson announced Thursday morning it will lay off about 400 workers at its Kansas City plant by the end of September.
The announcement comes as Harley-Davidson reported its worldwide sales of its new motorcycles down 30.1 percent compared to last year at the time.
Sales of new bikes in the U.S. were down 35.1 percent, according to a release from the company.
“While the underlying fundamentals of the Harley-Davidson brand remain strong and our dealers’ retail motorcycle sales declined less than our competitors, it is obviously a very tough environment for us right now, given the continued weak consumer spending in the overall economy for discretionary purchases,” said Harley-Davidson, Inc. President and CEO Keith Wandell said in the news release.
The company also plans to shut down two of the three production lines at the Kansas City plant for the fourth quarter of 2009, a company spokesperson said.
In total, about 1,000 people across the nation will be laid off, but 400 will be in Kansas City. The Kansas City plant makes the Sportster bike, which has not been selling well this year.
Now, my nephew is a pretty astute guy. He has seen this coming for about three years now, and started taking advantage of the tuition benefit his Union negotiated for in their contract so he wouldn’t be caught flat-footed when the only American motorcycle moved their manufacturing to China.
Harley is not just a motorcycle, it is a cultural icon, and a lot of the people who have been willing to pay for a new Harley did so because it is an American, union-made motorcycle. The people who are buying American Harley’s now, will continue to do so.
They should have learned their lesson in the 70’s, when AMF bought the company and the price of used, pre-AMF bikes went up and the new ones sat in dealer showrooms. Harley bought itself back, and the company thrived until the economic downturn.
Here is hoping Harley realizes this and is just scaling back to a labor force that better fit’s the needs of their contracting market share.