Pan America heralds a new era for Harley Davidson

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Recent years have not been good for Harley-Davidson. Its sales have plummeted, its core customers have aged, and its drive for an electric future, while serious recently, is underwhelming.

In 2019, the last full year unaffected by the coronavirus, Harley shipped 218,000 motorcycles, generating $ 424 million in net profit on $ 5.36 billion in revenue, which is pretty good but long gone. The results for the first quarter of 2021 show that the Milwaukee-based company could turn the financial turnaround, but the reality is that not enough new buyers are entering the market to compensate for the aging riders. Harley recently made its groundbreaking LiveWire electric model the flagship of a stand-alone brand, but electricity sales won’t impact bottom line until a more affordable model comes along that sells in higher volumes.

The company openly acknowledged these hurdles back in 2018, when Matt Levatich, who was CEO, outlined his More Roads to Harley-Davidson strategy. A key part of that plan would be to poach customers from other brands, which would mean moving away from the traditional (some might say stereotypical) cool Harley cruisers.

Perhaps the boldest proposal was Pan America’s high-tech, high-performance city touring bike, which will be powered by the new Revolution Max engine already in development. The answer was skepticism – that any Harley would be too heavy and too expensive.

The release of Pan America was delayed for a year, during which Mr. Levatich resigned under pressure from the company’s board of directors and after five years of falling sales. He was replaced by another member of the board of directors, Jochen Zeitz, who was previously the CEO of Puma.

Mr. Seitz grabbed the wheel, replacing the More Roads strategy with a firm approach he called “Hardwire.” It cut overheads and staff, closed several overseas subsidiaries, cut US dealerships, and cut inventories. In addition, he reduced the pace of new model launches and created an electric bike division.

The plan looked like a downsizing, and some industry observers wondered if Pan America would be released at all. But the new leader was just as determined to enter this market. The result, now on sale in dealerships, is a motorcycle that definitely doesn’t look like your father’s Harley-Davidson cruiser. The cheeky 1250cc Pan America Special is a major blow to European manufacturers who have long dominated this niche market.

“Before you jump into a new category, you always meet doubters and cynics, but I really don’t care about them,” Mr. Seitz said in an interview. “Adventure and travel is in the DNA of Harley-Davidson,” he added. “We weren’t active in the adventure tour market because we didn’t have a bike, but we definitely have a story. We couldn’t have built this bike if it wasn’t for the company’s DNA. “

The adventure touring category dates back to 1980 when BMW began selling the R 80 G / S, a model inspired by the motorcycles that competed in the Paris-Dakar rally. Fast forward 40 years and the BMW R 1250 GS is still a bestseller. You’ve seen them parked in front of your local café – tall, muscular bumpy bikes, often complemented by sturdy aluminum side skirts. These are motorcycles that seem to say, “Today I just drink latte, and tomorrow I’m heading to Tierra del Fuego.”

Fans simply call them ADV bikes. All of them are flagship models that can handle the Autobahn with confidence, with long-range suspensions capable of overcoming fire roads or worse; they all have advanced anti-lock brakes and traction control.

Another European manufacturer, KTM, sells an even taller Super Adventure model. Ducati, known for its sports bikes, offers its version of the Multistrada. When Ducati recently introduced adaptive cruise control for motorcyclesSo it was with the Multistrada V4 S Sport.

In February, Mr. Seitz hosted the highly publicized virtual launch of Pan America on the company’s website. YouTube channel… To the surprise of the skeptics, the weight (base model is 534 pounds) and price (from $ 17,319) seemed competitive. (Those numbers were £ 200 and $ 2,000 lighter than Harley-Davidson’s most popular heavy cruisers and touring bikes.)

Of course, adventure bikes are not virtually ridden. The asphalt, gravel, mud and sand they have to deal with are all too real. So once the coronavirus threat diminished, the company offered test drives at a remote camp in the Mojave Desert, about 100 miles north of Los Angeles. First impressions were made on hundreds of miles of paved and unpaved roads, jeep trails and an infamous stretch of treacherous deep sand.

The model provided was the Pan America Special (which is expected to roughly double the base model). The Special has a more extensive electronics package and semi-active suspension. According to tests, the bikes weighed around 574 pounds and cost around $ 21,500.

The answer this time was far from disappointing.

“I really had no doubt that engineers could do a good job,” said Kevin Duke, editor-in-chief. Thunder Presswho has been writing about motorcycles for 25 years. “But I was skeptical that they could enter a new market segment and be just as good out of the box.”

Mr. Duke was so impressed with his test ride that he changed his attitude towards the company. “The news about Harley over the past couple of years has been pretty pessimistic,” he said. “After the old demographic aging ended, there was no real hint of what the company could do to gain market share, but it does make a difference. The new motor is so good. “

Harley-Davidson calls itself the Motor Company. True to this slogan, engineers admit that they first built the engine and then ask themselves what they can do with it.

The only thing the Revolution Max has in common with other Harley engines is that it is a V-twin. It produces 150 horsepower and revs up to 9500 rpm, about double that of its cruiser cousins. Forget the laconic “potato-potato” exhaust of these slow-moving traditional cruisers; this one growls.

The new engine features a balance shaft so efficient that the engineers admitted to adding a little vibration to make it feel “like a Harley.” It features a computer controlled variable valve timing system that is more sophisticated than anything else on the market. The result is an engine that is aggressive to use, but obedient when needed, at low speeds in difficult terrain.

Like other motorcycles in its class, Pan America offers a range of riding modes that adjust throttle response, anti-lock braking system settings and traction control for rain, street or sports roads, as well as two off-road modes. settings. Owners can also create their own riding modes.

Harley has staked its first place among motorcycles: the Special semi-active suspension adjusts constantly to the weight of the rider, passenger and luggage; occurring terrain; and riding style.

Touring adventure bikes require extra ground clearance and long travel suspension. As a result, the seat height reaches 37 inches – which is intimidating even for tall riders. The Adaptive Ride Height option on the $ 1,000 Pan America Special lowers suspension when the bike stops. This is a radical game change for shorter and less experienced riders.

Off-road performance allows them to boast in the ADV category. But another thing these motorcycles have in common with Land Rovers and Mercedes-Benz G-wagons – besides being tough, durable and expensive – is that 99% of the time they ride on paved roads.

ADV bikes are as fun to ride on winding roads as any sports bike. Many motorcyclists switch to ADVs when their knees, wrists and shoulders can no longer support a sitting position while riding. And unlike conventional road bikes, ADVs give riders the ability to hit less popular roads. This is why ADVs are popular in Europe (where Harley-Davidson would like to increase its market share from 3 to 4 percent) and are becoming more popular here.

Harley-Davidson surveyed its customers before embarking on the Pan America project. Many of them already owned or were thinking of an adventure motorcycle. Pan America gives these customers a “Made in America” experience. (Revolution Max engines are built in Milwaukee; motorcycles are assembled in York, Pennsylvania.) Another plus for Harley that European manufacturers cannot match: its extensive dealer network.

Each Harley dealer, about 600 of them, will sell to Pan America — a decision made easier because customers were in a rush to deposit before the cars hit the showroom.

Under Mr. Seitz, Harley-Davidson tried to excite dealership enthusiasm. Dealers who have met certain goals have already driven through Harley’s Mojave training camp, so they’ll be able to talk when a new type of customer walks through the door.

When those customers leave, whether it’s Starbucks or South America, Pan America will be at home.

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