The Harley-Davidson (HOG 5.31%) activist investor who helped oust ex-CEO Matt Levatich earlier this year says his replacement is just what the motorcycle maker needs.
Impala Asset Management founder Bob Bishop told Reuters that under the leadership of Jochen Zeitz, "For the first time in five to six years, the company is on the right track again."
Making a U-turn
Harley-Davidson is caught in a five-year-long sales slide as its core customer has aged out of the market and new bike buyers haven't gravitated toward the big, heavy motorcycles it's famous for.
Levatich sought to change the dynamic by focusing more on international markets than its main U.S. business, while also pledging to build 100 new models in 10 years and bringing in millions of new riders. Harley would also go into electric motorcycles in a big way under his plan.
Zeitz, however, hit the brakes on those ambitious initiatives.
Although not providing details yet on his revamped strategic vision, Zeitz told analysts last month:
Complexity needed to be dramatically reduced. Goals set needed to be achievable and realistic. Our strategy had to be refocused to better align with our capacity and capabilities and also our new reality, focusing on what makes a difference and nothing else.
Echoing Zeitz's belief that aging customers are not what's hurting Harley, Bishop told Reuters: "When you build up the brand, you will sell more bikes. Get rid of this idea that the demographics is killing them."
To achieve Harley's new goals, Bishop said models selling fewer than 300 units a year will be dropped while emerging markets like India and Latin America that have been a cash drain could be abandoned. He also believes Harley-Davidson should become an "aspirational" brand.
The company declined to comment on Bishop's statements.