Harley-Davidson cuts jobs as young Americans buy fewer bikes compared to baby boomers

Harley-Davidson, the motorcycle maker President Donald Trump has praised for its US manufacturing presence, is cutting workers as younger American consumers buy fewer bikes than baby boomers.

Chief Executive Officer Matt Levatich told analysts on Tuesday the company planned to make hourly employment reductions and would share details with workers later. Harley’s shares plunged the most in more than a year after the company forecast annual motorcycle shipments may decline as much as 8 per cent.

The moves run counter to Trump’s claims he would drive US economic growth by spurring more factories and hiring. The president in February called Harley a “great example” of successful American manufacturing and said his administration would make it easier for businesses to create jobs and build plants. Instead, slumping demand for pricey bikes has left Harley with too much inventory and needing to pare production at home.

“It’s unfortunate,” said David Beckel, a Bernstein analyst who downgraded the stock last week, citing a lack of demand from younger Americans. “It’s just a symptom of the environment they’re facing,” as competitors cut prices and millennials show less interest in motorcycles than past generations.

Harley shares plunged as much as 12 per cent in New York, headed for the biggest daily drop since July 2016. The shares have declined 17 per cent this year.