Harley Davidson Recall, Production Problems Plague Milwaukee Firm
Harley-Davidson Inc announced that it would recall more than 300,000 motorcycles in the United States and worldwide for problems with a rear brake light switch which they say may be exposed to excessive heat from the exhaust system and activate the brake lamp when no brake is applied.
H-D told the National Highway and Transportation Safety Administration that the fault might also cause a fluid leak at the brake light switch.
According to the company, the recall and repairs will cost $10-$12 million in the fourth quarter alone.
If that’s not enough, Harley-Davidson say they aren’t making enough of the company’s most expensive models to meet demand. Investors were none too pleased about that news and trading activity hammered the Milwaukee company’s stock down 7 percent last week. Tempering that news was the fact that Harley-Davidson reported its third-quarter profit more than doubled as compared to last year’s numbers.
A spokesperson said Harley wasn’t able to produce as many of the larger touring and custom bikes prized by their traditional customer base. They say the reason for the shortfall is a large restructuring which saw Harley consolidate production of several models at their state-of-the-art assembly line in York, Pennsylvania.
Overall in the market, sales of new motorcycles rose 5.1 percent to 61,800 bikes and included a 5.4 percent increase in U.S. sales.
“Are we disappointed that things haven’t been perfect? Yes. But I will tell you that we are pleased with where we are in this transformation,” said Harley-Davidson Inc.’s Chief Executive, Keith Wandell.