Harley-Davidson (HOG 0.78%) is doing something for its LiveWire brand it should have done from the start: creating an entirely new brand identity.
By making LiveWire a separate operating business distinct from the Harley brand, this small but significant change could help its electric motorcycle become a viable business in its own right that returns the motorcycle maker to growth.
Image source: LiveWire.
Serving two masters
Harley-Davidson has tried having separate brands before, though never successfully. It had Aermacchi bikes in the 1960's and 1970's, branded RVs in the 1980's, and it purchased Buell Motorcycle in the late 1990s, though it was never a commercial success under its tutelage and was eventually shut down. It bought MV Agusta a decade later for $109 million, but sold it back to them less than two years later for just 3 euros, or less than $4.
When Harley-Davidson announced the LiveWire electric motorcycles in 2014, it had all the hallmarks of being in the same vein: a motorcycle far afield from its core heavyweight bikes for which it would have to appeal to a new, different kind of motorcycle rider.
The readily draws comparisons to Harley's racing-styled V-Rod that featured a Porsche-made liquid-cooled engine. Launched in 2001 to introduce the Harley brand to riders who otherwise might not have considered the bike maker, it was an engineering marvel that still draws accolades, but sales never amounted to much during its 17 year run.
Yet now with Harley-Davidson giving LiveWire its own dedicated showrooms, a separate (virtual) headquarters with hubs in Silicon Valley and Milwaukee, and allow it to operate as its own business, it looks like management is setting up this business in a new wat where there's a good chance the bike maker can be successful on both fronts.
Leaving the past behind
LiveWire is going to be both a motorcycle and a brand with its own identity. Gone are the iconic bar-and-shield logo, replaced by a leaner, lighter "LiveWire" name and stylized logo. In fact, the name "Harley-Davidson" doesn't appear anywhere on the bike.
Because it will interact only with participating dealerships "as an independent brand," it sounds as though this won't be a forced, top-down approach and will include only dealers who actually want to sell the bikes.
Harley has never released any hard sales figure for its original LiveWire electric bike, though analysts were numbering their estimates in the hundreds. Yet the biggest hurdle was its price tag. At $30,000, it was far above its primary rival Zero Motorcycles, which sells similarly sized electric bikes for one-third to one-half the price.
On the other end is Lightning Motorcycle that sells electric motorcycles across the pricing spectrum, with high-end models starting at almost $39,000, but also others at $20,000.
Harley, though, kept saying driving a lot of sales with the LiveWire was never its intended purpose, but was intended to serve as a museum-quality "halo" product.
The new LiveWire One, however, was just unveiled with a list price just under $22,000 (and federal tax credits could push it below $20,000 for buyers), indicating Harley wants this motorcycle to actually sell. It suggests this first bike from the brand could be every bit the success that the original was not.
Image source: LiveWire.
There are still speed bumps along the way
But let's not discount the hurdles Harley still faces. Harley is focusing first on the urban rider because the LiveWire's range is not really compatible with long distances. It has a 146-mile city range on a full charge, which falls to under 100 miles when you factor in sustained 70 mph trips.
In comparison, the Zero SR/S has a 161 mile range, but can go up to 200 miles with the extended battery pack. It lists at $20,000. Lightning's Strike bike also has a 200-mile city range, 100 miles highway.
Also, a fast-charge network is not universally available, so these will mostly remain commuter bikes, which is why Harley was smart to drop the LiveWire One's price down to a more competitive level.
Where the rubber hits the road
By treating the electric motorcycle and all subsequent two-wheeled EVs as separate entities, Harley-Davidson helps the LiveWire avoid all the baggage that flows from the legacy nameplate.
It has taken a good first step toward giving LiveWire its best chance to date at success, and with the new LiveWire One being a feature laden, competitively priced electric vehicle it gives the new brand a good roadmap to follow for the future.
