Harley-Davidson CEO Jochen Zeitz doubled down on his “Rewire” turnaround approach as the enterprise reported its steepest decrease in U.S. retail revenue in at the very least 6 years.

Zeitz’s approach, which he unveiled in April, is intended to revive an iconic manufacturer that has been having difficulties for years to grow revenue further than baby boomers. As component of the approach, Harley said last thirty day period it would slash seven hundred work from its worldwide functions.

On Tuesday, the enterprise posted one more rough quarter as the coronavirus pandemic contributed to a 53% decrease in motorcycle and relevant solutions earnings, to $669 million, and a decline of sixty cents per share for the quarter, in comparison with a revenue of $one.23 per share a calendar year back.

Analysts on regular had predicted a revenue of four cents per share.

In the U.S., Harley’s most important current market, retail revenue plunged 27% calendar year-on-calendar year for the 2nd quarter. The enterprise has not reported U.S. retail revenue growth in the earlier 14 quarters.

“A full rewire is required to make Harley-Davidson a superior-performance enterprise,” Zeitz said in a news release, incorporating that the enterprise was performing on a 5-calendar year “Hardwire” approach that is “grounded in boosting the desirability of our manufacturer and preserving the value of our iconic solutions.”

“As we labored by way of Rewire, it was pretty evident to me that we had lost our target on the strength of our manufacturer in favor of promotional actions which erode our value and the investment our riders make in our solutions,” he told analysts.

In accordance to Zeitz, Harley will exit international markets in which volumes and profitability do not guidance continued investment and shrink its motorcycle lineup by about thirty%, a departure from previously tactics of incorporating bikes to the portfolio.

The Milwaukee Journal Sentinel reported, even so, that analysts are not sold on the Rewire approach.

“Maybe they bought too focused on the younger client and lost target on the main client. But the difficulty nonetheless remains that the main client is just aging and is just not as intrigued in riding motorcycles as they ended up in their 40s and 50s,” said analyst Brian Yarbrough, senior client analyst with Edward Jones.

Drew Angerer/Getty Photographs

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