Harley Davidson Layoffs 2020: Why The Motorcycle Manufacturer Is Cutting 140 Production Workers

Harley Davidson (HOG) has become the latest company to implement a series of layoffs, reportedly cutting about 140 jobs in the U.S.

The job cuts come as Harley Davidson looks to adjust its production volumes as the demand for motorcycles has declined amid the coronavirus pandemic, Reuters reported.

The company has also seen its sales dip over the past five years as its prime customer base – baby boomers – ages out of the market, the news outlet said.

For the first quarter, Harley Davidson saw a 15.5% decline in retail sales in the U.S. compared to a year earlier, as about half of its dealers were closed because of stay-at-home orders due to COVID-19.

“COVID-19 has dramatically changed our business environment and it is critical we respond with agility to this new reality,” Jochen Zeitz, acting president and CEO of Harley-Davidson said at the time of the company’s first-quarter earnings report.

“The crisis has provided an opportunity to reevaluate every aspect of our business and strategic plan. We have determined that we need to make significant changes to the company; to our priorities, to our operating model and to our strategy to drive more consistent performance as we emerge from this crisis.”

The layoffs will reportedly impact production workers at Harley Davidson’s York, Pennsylvania, and Tomahawk, Wisconsin, facilities, which reopened in May after shutting down in mid-March because of the virus.

A Harley Davidson representative told Reuters in a statement, “As course of normal business, Harley-Davidson regularly adjusts its production plan and appropriately sizes its workforce.

Harley Davidson has been on a cost-cutting spree as slashed capital spending, enacted a hiring freeze, reduced salaries, and eliminated merit increases for workers across the company. Harley Davidson said it had about $1.47 billion in cash on hand at the end of the first quarter.

Harley Davidson stock was trading at $23.68 per share at 10:08 a.m. EDT, down $0.73 from 2.99%.