Harley-Davidson’s September incentives are less promotional year over year and unlikely to spur the retail sales growth that dealers were expecting, according to a report that Wedbush Securities provided to Powersports Finance.
On average, Harley-Davidson dealers experienced a mid-single-digit decline in retail unit sales during the third quarter, according to the report. Dealers previously had hoped to receive aggressive incentives to help push lingering models out of the inventory, which Harley had done the prior year.
Harley-Davidson introduced financing incentives on several models last month with APRs ranging from 0.99% to 5.5% with no money down, depending on the model. Additionally, Harley launched a zero money down and 0.99% to 2.99% promotion on touring bikes, which was “fairly promotional given [Harley’s] recent incentives and also considering it was placed on Harley’s most popular motorcycle segment,” James Hardiman, managing director and leisure analyst, wrote in the report.
However, the promotion was less aggressive compared with 2018, as the OEM’s promotions from the third quarter of 2019 were some of the “most significant” incentives of the year, Hardiman noted.
During the same time last year, Harley gave dealers $1,000 per model year 2018 bike sold through the end of September, an incentive previously offered by the OEM in 2017 to clear the model year 2016 inventory. On the consumer side, Harley ran a zero money down and 0.99% to 1.99% financing promotion on 2017 through 2018 softails and touring bikes in the month of September.
“The September 2018 promotion was well received with a number of our [dealer] contacts, citing it as the primary driver behind the pickup of sales during the month and ultimately translated into the strongest period of the quarter,” Hardiman said. “So, while Harley was more aggressive to end the third quarter of 2019, we do not believe it was enough to top last September’s success given the strong dealer feedback we heard last year and more tame incentives this time around.”
Despite the less aggressive promotions, dealers are “hopeful” that there will be more incentives to help move the 2019 inventory, Hardiman added.