Skip to main content

Weak August Hammers Harley

The motorcycle maker says sales plunged last month.
  • Author:
  • Publish date:

Harley-Davidson (HOG) - Get Harley-Davidson Inc. Report sank 9% after the motorcycle manufacturer cut third-quarter production and trimmed 2007 earnings guidance, saying sales fell off a cliff last month.

The Milwaukee-based company said it now expects to ship between 86,000 and 88,000 motorcycles in the third quarter, down from its initial expectation of 91,000 to 95,000 units. The company said it expects earnings for the full year to fall to $3.69 to $3.77 a share from last year's $3.93. Analysts surveyed by Thomson Financial were looking for $4.12.

The company also guided lower for 2008, saying it expects to see earnings growth of 4% to 7% with moderate revenue gains and lower operating margins. That guidance puts Harley's 2008 earnings target at around $3.90 to $4 a share, vs. the $4.50 Thomson target.

"Initial reports about our 2008 model year motorcycles from our dealers and the media have been excellent, but this is a difficult time for the U.S. consumer," said CEO Jim Ziemer. "Coming off a negative U.S. retail sales trend in the first six months of the year, we ran an effective promotion in July that increased retail sales and reduced inventories of 2007 model motorcycles. However, our U.S. dealers' retail sales have fallen sharply during August."

Scroll to Continue

TheStreet Recommends

Shares fell $4.90 to $49.16.