Harley-Davidson to Lay Off Workers—Again—as Motorcycle Shipments Slump

January 30, 2018, 11:37 PM UTC

Motorcycle maker Harley-Davidson said on Tuesday that it would slash jobs and close a plant because of declining motorcycle shipments.

The company plans to shutter a factory in Kansas City in 2019 and send some of that production to another plant in York, Penn. As part of the overhaul, around 800 jobs in Kansas City will be cut, but 450 will be added in York, Reuters said.

Overall, Harley-Davidson expects to eliminate 260 jobs in the U.S., Bloomberg reported.

The United Steelworkers labor union, which represents workers at the Kansas City plant, said it was as “blindsided” by the news, according to Bloomberg. The International Association of Machinists and Aerospace Workers also expressed frustration.

The restructuring will cost $170 million to $200 million before 2019, the company said. But starting in 2020, it estimates it will save $65 million to $75 million annually.

The company is also closing a plant in Adelaide, Australia, but it is opening one in Thailand.

Last year, President Trump praised Harley-Davidson as a “great example” of a company creating U.S. jobs. But soon after, the company started a series of layoffs including 118 U.S. workers in April, followed by another 180 in July.

“Not long ago, President Trump hailed this company as a model of American manufacturing,” the director from United Steelworkers District 2 said in July of 2017. “Shortly thereafter, management announced plans to open production facilities in Thailand. Now we get word that 180 hard-working Americans will be lose their jobs.”

Harley-Davidson cut 200 U.S. manufacturing jobs in September of 2016.

In 2017, the company shipped 241,000 motorcycles, which was at the low end of its forecast of 241,000 to 246,000. This year it expects to ship 231,000 to 236,000 motorcycles.

Harley-Davidson’s shares fell more than 8% to $50.59 on Tuesday, due to the disappointing forecast, according to Reuters.

Harley-Davidson has struggled to attract younger buyers as its target market ages. The company’s overall fourth quarter sales fell 9.6%.

During Tuesday’s earnings call, the company also announced the development of an electric motorcycle called Project LiveWire. The company hopes to add 2 million riders overall in the next decade.