Harley-Davidson Inc. today reported a 24% drop in third quarter profit, according to Reuters. The slump comes as customers pull back on discretionary spending in the wake of higher borrowing costs and inflationary pressures.
The brand has maintained margin growth through its wealthier customer base but has had less success obtaining the business of younger riders. Harley’s price increases and surcharges for popular models have lifted the manufacturer’s earnings per share previously, but demand is continuing to slow.
Harley’s retail sales were down across all regions, with its North American market declining for a third consecutive quarter. The revenue shortfall was attributed by the company to higher borrowing costs and the discontinuation of its Sportster model at last year’s end.
Sales for motorcycles and related products fell roughly 9% to $1.3 billion in the quarter ended Sept. 30; global motorcycle shipments dropped 20% during the third quarter due to production suspension announced in the late second quarter; and Harley’s net profit decreased to $198.6 million from $261.2 million one year earlier.
