Four months ago, news that beleaguered Harley-Davidson
I think that fear is misplaced.
Fact is, Wandell's record suggests that he just might be the right person to pull Harley out of the ditch it's been driven into and get the company turned around. A 21-year veteran of auto parts maker Johnson Controls
At Johnson Controls, Wandell helped contribute to the company's phenomenal growth that has netted shareholders 13% annual returns during his tenure. And while it's true that Johnson has suffered recently as business fell apart at customers Ford
When in a hole, stop digging
More than Johnson's stock price, however, Wandell impresses me with how he's helped run Johnson's business in this recession. As sales plummeted 22% sequentially last quarter, Wandell worked to control inventories and maximize free cash flow from the business that did get done. Result: Inventories declined throughout the year, and in a miserable time for both cars and construction, Johnson generated $545 million in cash profit over the past 12 months.
This tells me that Wandell has the chops to finally address Harley's biggest problem -- rising inventories in a time of declining sales. Thanks largely to a continued growth in inventories despite slipping sales, Harley had trouble generating cash last year, forcing management to cut its dividend and go hat-in-hand to Berkshire Hathaway
Here's hoping that with Wandell now in charge, Harley will finally learn to fix its own problems.
Why is that? Read on and find out: