Motorcycle Forum

Motorcycle Forum (http://www.motorcycle.com/forum/)
-   Motorcycle News (http://www.motorcycle.com/forum/motorcycle-news/)
-   -   Harley-Davidson seeks federal bailout (http://www.motorcycle.com/forum/motorcycle-news/10458-harley-davidson-seeks-federal-bailout.html)

BrowningBAR 01-22-2009 07:01 AM

Quote:

Originally Posted by longride (Post 202038)
Looks like that purchase of MV is working like I expected. Nice move for H-D. All they need to do is buy one more loser and Chapter 13 is in the works.

If this happened two years from now, I might agree...to a small degree.

But that is not the case here. Harley is valued at $3 Billion. They purchased MV for $108 million.

HDs quarterly revenue is about $1.3 billion with about $5 billion in annual revenue.

A $103 Million dollar purchase (that included all MV debt) shouldn't have broken the bank. But it really seems HD has been poorly managed as of late as there has been repeated mention of growing debt. Based on this, was the MV purchase a smart move? Doesn't seem like it. Is it the reason why they want bailout money? No.

My question is, how many bad loans did Harley give out? How does a company like this have growing debt if the bikes have sold for over MSRP for many, many years? Is it purely bad loans to the masses, much like the housing market? Will there be accounting issues that pop up soon? I wouldn't be surprised based on past examples of other companies.

Bottom line, they should NOT get a bailout.

It is interesting to note that this is another company that has a strong union presence. I have to assume it is the same structure as the UAW. So, who knows how much money is tied up in retirement packages, etc.

sarnali2 01-22-2009 07:02 AM

Excellent use of LoPan image and quote B-Bar! another favorite of mine..


I wasn't able to read the article but I get the gist of it from the other posts. It seems to be the same story as with other vehicle and luxury item manufacturers, financing a $20k vehicle be it a boat or bike or RV is easy when you're working OT out the butt and piling money in the ol' 401K. It's when the economy hits the sink and you or your spouse loses their job or gets hours cut back that changes need to be made. That's when it comes down to keeping a roof over your head and clothes on your kids backs, for most people in that position it means the toys got to go one way or the other. Since that bangin' HD you paid $25k for will now sell for $10k if you're lucky enough to find a buyer you either walk away or......

That's why the finance arm is losing it's butt, no secret there. Buying MV was a stupid move but it's not the reason for them being in the soup now, it's the fact that to most people a bike is a toy not a way of life or their main transportation. Personally the only thing I value more than my bike is..well nothing really.. I'd live in a trailer and drive a beater 20 year old Bronco 2 before I'd default on my bike. But thats just me, my kids are almost grown and I don't really have any other commitments, most people aren't that lucky.

seruzawa 01-22-2009 07:02 AM

I'm not so sure about MV. While it's a troubled marque its target market is wealthy individuals with money to burn. MV's sales just might maintain current levels while HD itself tanks out. Sort of like Bentleys continued to sell despite the general state of the economy. Even if some people's worth has dropped from 50mill to 25mill they still aren't eating beans.

longride 01-22-2009 07:05 AM

"That's boneheaded mgmt."

Gotcha on that one. It didn't take a genius to see that the gravy train was grinding to a halt. They need to trim their product line and hunker down for the bad times. My buddy got a quote on a new Street Bob, and the dealer has called him about 5 times in 3 days, practically begging him to buy it.

longride 01-22-2009 07:11 AM

"While it's a troubled marque its target market is wealthy individuals with money to burn."

So how much money did MV make selling MV's? I believe they needed financial help about 4 times in the last 10 years. Not exactly a cash cow there. Harley didn't need to add more red ink at this point.

sarnali2 01-22-2009 07:15 AM

A buddy of mine just bought a new '08 Road Glide for $17.5k, the same bike I looked at this summer before I bought my E-Glide for $18.6K only then it was going for $22k...that's $4500 off MSRP on a shiney new Harley Touring bike..I haven't seen deals like this since the early '80's when they'd beg you to buy a bike.

The '05 Dyna I traded in and got $10k for in July is still there with an asking price of $10.4...that's $400 dollars profit on a bike they've sat on for 7 months and it's a nice looking basically stock bike with a few comfort and appearance mods, not all ******** up or over done.

I don't think Harley will need AMF again anytime soon but the shake-out has most definately begun.

seruzawa 01-22-2009 07:22 AM

Quote:

Originally Posted by longride (Post 202070)
"While it's a troubled marque its target market is wealthy individuals with money to burn."

So how much money did MV make selling MV's? I believe they needed financial help about 4 times in the last 10 years. Not exactly a cash cow there. Harley didn't need to add more red ink at this point.

I'm not arguing that. I'm just saying that MV might weather the storm better than HD itself. After all, all you need to do to make an Italian firm profitable is to lock up the wine and fire everyone who is asleep. Instant profitability.

The_AirHawk 01-22-2009 07:59 AM

Me no feel bad for Hardly-Ableson Stealers - Me LAUGH ! HAHAHAHAH!

You take 25-percent ADM & 2-year-wait and shove up you ass now.

HAHAHAHAH!!

longride 01-22-2009 08:43 AM

After watching what Harley 'owners' were doing during the boom, I can understand 100% why the dealers did what they did. If you were in their position, you would do the same. Do I feel sorry for them? Hell no. Do I understand why they charged up the yahoo? Yes. There were dealers that were straight-up during that time. Lake Shore Harley was one of them, which is why they got, and continue to get, my business.

seruzawa 01-22-2009 09:27 AM

Quote:

Originally Posted by longride (Post 202085)
After watching what Harley 'owners' were doing during the boom, I can understand 100% why the dealers did what they did. If you were in their position, you would do the same. Do I feel sorry for them? Hell no. Do I understand why they charged up the yahoo? Yes. There were dealers that were straight-up during that time. Lake Shore Harley was one of them, which is why they got, and continue to get, my business.

Maybe the HD employees might have to accept less than $19.80 per hour starting wages for unskilled labor?

Notice how the Unions demand big increases when the company is doing well but refuse any cuts when things go south? I've had to take a pay cut to keep a job before. Too bad for the thugs. Not one HD employee said, "Maybe we should have mercy on the customers" when they were racking up overtime. Eff 'em now.


All times are GMT -7. The time now is 12:47 AM.