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Harley Davidson Downshifts to a Second-Quarter Loss

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Despite the allure of escaping to fresh air, open roads and fewer crowds, the coronavirus pandemic took its toll on hog-maker Harley Davidson  (HOG) , with the iconic motorcycle maker posting worse-than-expected second-quarter losses.

Harley Davidson on Tuesday said it lost $92 million, or 35 cents an adjusted share, in the quarter ended June 30, vs. income of $196 million, or $1.46 a share, in the same period a year ago.

Analysts polled by FactSet had been expecting earnings of 10 cents a share. Sales fell to $865 million, above the $760.6 million expected by analysts polled by FactSet but about half of the $1.63 billion it rang in a year earlier.

Already struggling from competition and a general drop in sales before the pandemic, Harley Davidson said it has launched a restructuring program called “The Rewire” that it says will “reduce duplication and inefficiencies.” 

"A total rewire is necessary to make Harley-Davidson a high-performance company,” said CEO Jochen Zeitz, noting the effort is expected to generate $250 million in cash savings and another $100 million in ongoing annual savings.

Following the rewire program, Harley Davidson will kick off its “The Hardwire” program, “which will be grounded in enhancing the desirability of our brand and protecting the value of our iconic products," Zeitz said.

Harley-Davidson plans to concentrate on approximately 50 markets primarily in North America, Europe and parts of Asia Pacific "that represent the vast majority of the company's volume and growth potential."

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