- Five-pillar strategy aims to deliver over 350 million USD EBITDA by 2027
- 20 new models planned over three years, including the return of the 883 Sportster
- Dealers expected to quadruple their profitability by 2029
On May 5, 2026, Harley-Davidson used the presentation of its first quarter 2026 earnings to simultaneously announce a comprehensive strategic reset. Under the banner “Back to the Bricks,” CEO Artie Starrs unveiled a plan designed to fundamentally realign the Milwaukee-based company. The name says it all: it refers to the historic headquarters on Juneau Avenue, internally known as “the Bricks,” which reopened for all employees in spring 2026 for the first time since 2020.
What is behind the “Back to the Bricks” strategy?
Harley-Davidson’s new strategic plan is a direct response to declining sales figures and waning relevance among younger demographics. At its core, the company is betting on recapturing lost market share by significantly lowering the barrier to entry into the brand while strengthening its dealers and better leveraging the entire economic ecosystem surrounding every motorcycle sold.
The strategy rests on five pillars: First, the company’s existing competitive advantages are to be leveraged more consistently — the brand value itself, diversified revenue streams, and the dealer network. Second, dealer profitability takes center stage. Harley-Davidson plans to double the earning power of its exclusive dealers in 2026 and double it again by 2029. Third, the company aims to recapture market share where it has historically been strong: in new motorcycles, used motorcycles, parts and accessories, as well as apparel and licensed products. Fourth, cost-cutting and restructuring measures are intended to strengthen free cash flow and EBITDA margins. Fifth, the leadership team has been supplemented with new talent bringing fresh perspectives combined with institutional knowledge.
Why is Harley-Davidson changing strategy yet again?
Artie Starrs is already the third CEO to initiate a fundamental course correction in the past six years. His predecessor Jochen Zeitz had focused heavily on the premium segment with the “Rewire” and “Hardwire” programs starting in 2020, restricting the model range and targeting higher margins per motorcycle sold. Before that, Matt Levatich had attempted to lead the brand into new segments with “More Roads to Harley-Davidson” starting in 2018, including adventure bikes, streetfighters, and electric models. The result included the Pan America and the liquid-cooled Revolution Max platform.
Starrs is now taking a third path. He maintains the focus on the traditional Harley customer but simultaneously wants to reach new, less affluent buyers rather than continuing to squeeze the top end of the market. During the analyst conference, Starrs noted that the brand had lost relevance in recent years due to the discontinuation of iconic models like the Sportster. Lower unit volumes had depressed dealer profitability and created a dependence on broad-based discount campaigns, particularly on high-priced models.
What does the roadmap look like?
Implementation is structured in three phases. The first phase, the “Reset,” is already underway. Harley-Davidson has cut jobs, reduced production costs, and lowered dealer inventory worldwide by 22 percent year-over-year. The company expects annual cost savings of at least 150 million USD (approximately 128 million euros), which should take full effect from 2027, measured against the 2025 cost base.
In the second phase, the “Growth” phase starting in 2027, a broader and better-balanced portfolio is set to hit the market. Instead of “too many of too few” models, Harley-Davidson aims to offer more variants on existing platforms without developing expensive new powertrains. A total of 20 new models have been announced over the next three years. Parts and accessories are expected to play a significantly larger role: the company plans to reintroduce 30 percent of previously discontinued part numbers and achieve revenue growth of 20 to 30 percent in this segment.
The third phase, “Acceleration,” aims to deepen the entire ecosystem around the motorcycle: stronger participation in the used market, further growth in apparel and licensed products, and a closer bond between riders and the brand.
What are Harley-Davidson’s financial targets for 2027?
For fiscal year 2027, Harley-Davidson is targeting EBITDA of over 350 million USD (approximately 299 million euros) in the HDMC (Harley-Davidson Motor Company) segment. Medium-term, the EBITDA margin should range between 10 and 12 percent, with gross margins between 25 and 30 percent. Operating expenses are targeted to fall below 20 percent of revenue. In terms of volume, the company is pursuing mid-single-digit annual growth in retail unit sales.
For the current year 2026, the guidance remains unchanged: 130,000 to 135,000 units in retail and wholesale. Harley-Davidson expects to achieve a nearly balanced ratio between wholesale shipments to dealers and actual sales to end customers for the first time.
What do the latest quarterly results show?
The first quarter 2026 results paint a mixed picture. On the positive side, global retail sales rose 8 percent to approximately 34,000 motorcycles. In North America, the increase was 14 percent, and in the United States alone, 16 percent. The U.S. market share in the segment above 601 cc rose by two percentage points to 38 percent. In Europe, market share doubled from 2 to 4 percent. Latin America grew 21 percent, driven by Brazil and Mexico.
Consolidated revenue declined 12 percent, primarily because the financial services division HDFS recorded 54 percent less revenue after selling a large portion of its loan portfolio. HDMC revenue decreased only 2 percent to 1.1 billion USD (approximately 940 million euros). However, the HDMC segment’s operating income fell sharply from 116 million to 19 million USD. The main reasons were tariff costs of 45 million USD in the quarter, negative pricing effects from discount campaigns, higher warranty costs from recalls, and restructuring charges of 15 million USD. Earnings per share dropped from 1.07 to 0.22 USD.
What role do tariffs play for Harley-Davidson?
In the first quarter of 2026, new or increased tariffs burdened results by 45 million USD. For the full year 2026, Harley-Davidson expects tariff costs between 75 and 90 million USD (approximately 64 to 77 million euros), which is better than the previously stated range of 75 to 105 million USD. The burden is expected to decrease on a quarterly basis throughout the year.
Relief comes from a U.S. tariff exemption issued in April 2026 for certain motorcycles as well as parts and accessories used in motorcycle production. Harley-Davidson emphasizes in this context that three of its four production facilities are located in the United States and that 100 percent of core models destined for the U.S. market are manufactured there.
What does the new strategy mean for dealers?
The role of dealers is a central element of the entire strategy. Starrs described dealer profitability during the analyst conference as “non-negotiable” and “ultimately a win for shareholders.” His argument: when dealers operate profitably, they invest in better customer experiences, need fewer price concessions from the manufacturer, and thus strengthen the brand’s premium positioning. Additionally, dealers serve as local brand ambassadors through HOG chapters, events, and the Riding Academy.
Since taking office, Starrs has personally visited a large portion of the dealer network, including all global dealer advisory councils. Specific measures include reducing inventory levels, better coordination of promotional campaigns, and structural improvements to dealer programs.
Harley-Davidson now consistently thinks of the business as an “Enterprise Economic Model” — a holistic value creation framework. A motorcycle sold generates revenue not only at the point of initial purchase but throughout its entire lifecycle: through parts and accessories, workshop service, financing and insurance, and ultimately on the used market. Both Harley-Davidson and its dealers participate at all of these touchpoints.
What new models has Harley-Davidson announced?
Two models are at the center of the portfolio expansion. The most important announcement is the return of the classic Sportster with an air-cooled Evolution V-Twin and 883 cc displacement. Starrs confirmed that the Sportster was the most frequently requested model among dealers worldwide, from Louisville to Frankfurt to Shanghai. The target retail price is around 10,000 USD (approximately 8,550 euros). The last version, the Iron 883, had a list price of 10,749 USD when it was discontinued in 2022. Units destined for the U.S. market are to be manufactured at the York plant in Pennsylvania. Market launch is planned for model year 2027.
The second new model is the Sprint, an entry-level motorcycle with an oil-cooled single-cylinder engine. The motorcycle is believed to be based on the Harley-Davidson X440, which was developed and produced by Indian partner Hero MotoCorp. The X440 produces 27 hp (20 kW) and 38 Nm at 4,000 rpm according to the manufacturer. The Sprint is expected to cost less than 10,000 USD. The original price target of around 6,000 USD set under Zeitz was not reconfirmed. However, in a Reuters interview, Starrs still spoke of a price of “approximately 6,000 dollars” and an orientation toward younger riders. The production location for the Sprint has not yet been determined according to Harley-Davidson, which will directly impact the final price.
Both models are conceived as “blank canvas” motorcycles — deliberately designed as a base for customization through parts and accessories. This way, they are intended not only to attract new customers but also to drive the parts and accessories segment, which is particularly high-margin for Harley-Davidson.
What happens with the existing platforms?
Touring remains the core segment. Beyond that, Harley-Davidson plans to make broader use of the existing Revolution Max, Softail, Touring, and Trike platforms. A graphic from the investor presentation shows gaps in the current lineup that are to be filled in the coming years: between the Nightster and Sportster S in the Revolution Max range, between the Sportster S and Pan America, in the sub-10,000 USD area of the Softail line, between the Street Bob and Low Rider S, and between the upper Softail segment and the entry point of the Touring range. A more affordable trike model is also planned.
Five Revolution Max models are confirmed for 2027 and 2028. The current range comprises six models, including the Sportster S. Whether the Sportster S will remain in the lineup alongside the returning classic Sportster 883 has not yet been communicated by Harley-Davidson.
What role does marketing play in the new strategy?
Parallel to the product offensive, Harley-Davidson has launched a new marketing platform called “Ride.” The company aims to position itself more strongly as a brand platform and rely less on aggressive discount campaigns. Instead of broad-based price cuts, more targeted, disciplined promotions are intended to support sales while protecting margins. Increased investment is being directed toward community building, including HOG events, rallies, and initiatives like the Riding Academy, which is designed to introduce new riders to the brand.
How is the financial services division HDFS performing?
Harley-Davidson Financial Services sold a large portion of its loan portfolio in 2025 and now operates with a capital-light business model. New loan originations are predominantly sold directly to strategic partners. This reduces the balance sheet and risk but also leads to significantly lower interest income. In the first quarter of 2026, HDFS revenues fell 54 percent to 112 million USD. The credit default rate stood at 3.6 percent, slightly better than the 3.8 percent in the prior year. Loan originations increased 14 percent to 671 million USD. Medium-term, HDFS is targeting operating income of 125 to 150 million USD by 2029 and plans to offer expanded financing solutions for parts and accessories as well.
What is the electric brand LiveWire doing?
LiveWire, Harley-Davidson’s electric subsidiary, increased revenue in the first quarter by 87 percent year-over-year, driven by higher unit volumes in electric motorcycles and STACYC children’s electric vehicles. The operating loss decreased by 11 percent, and net cash consumption from operations improved by over 25 percent. The launch of the S4 Honcho models is the focus for 2026. LiveWire expects an operating loss of 70 to 80 million USD for the full year.
What does “Back to the Bricks” mean for the market?
The new strategy is an attempt to achieve two things simultaneously: serve the traditional customer base while lowering the barrier to entry far enough that a broader audience can access a new Harley-Davidson motorcycle. With the Sportster 883 at around 10,000 USD and the Sprint well below that, Harley-Davidson would return to price ranges the company has not served for years. In the investor presentation, Starrs pointed out that used Sportsters often commanded prices at or above the original list price on the secondary market after their discontinuation in 2022, underscoring the sustained demand for this type of model.
Whether “Back to the Bricks” will prove more successful than its two predecessor strategies remains to be seen. The starting position is difficult: inflation, high interest rates, and geopolitical uncertainties are depressing demand for goods like motorcycles. At the same time, Harley-Davidson faces pressure from tariff costs and must absorb significant restructuring charges. The early signals are mixed. Retail sales are rising, dealer inventory is at a healthier level, and Wall Street reportedly received the strategy positively according to analyst assessments. At the same time, operating income remains under pressure, and profit margins have shrunk significantly.
Harley-Davidson as a brand faces the challenge of bridging the gap between tradition and accessibility. If the 883 Sportster does come to market at around 10,000 USD and the Sprint offers a functional entry-level option below that, the company would have at least formulated a coherent answer on the product side to the question of how to win new buyers in a difficult environment without alienating the existing customer base.
Frequently Asked Questions
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What is Harley-Davidson’s “Back to the Bricks” strategy?
“Back to the Bricks” is the strategic plan unveiled in May 2026 by CEO Artie Starrs. It aims to deliver profitable growth through more affordable entry-level models, stronger dealers, cost reductions, and a broader model range built on existing platforms. The EBITDA target for 2027 is over 350 million USD (approximately 299 million euros).
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When is the Harley-Davidson 883 Sportster coming back?
Harley-Davidson plans the return of the air-cooled 883 Sportster with an Evolution engine for model year 2027. The target price is around 10,000 USD (approximately 8,550 euros). Units for the US market will be manufactured at the York plant in Pennsylvania.
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What is the Harley-Davidson Sprint?
The Sprint is a planned entry-level model with an oil-cooled single-cylinder engine, expected to be based on the X440 platform developed jointly with Hero MotoCorp. The X440 engine produces 27 hp (20 kW) and 38 Nm according to the manufacturer. The price is expected to be under 10,000 USD, and the exact production location has not yet been determined.
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How did Harley-Davidson’s sales figures develop in Q1 2026?
Global retail sales rose by 8 percent in the first quarter of 2026 to around 34,000 motorcycles. In North America, the increase was 14 percent, and in the US alone 16 percent. The US market share in the segment above 601 cc rose to 38 percent.
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How many new models is Harley-Davidson planning?
Harley-Davidson has announced 20 new models over the next three years, to be built on existing platforms such as Revolution Max, Softail, Touring, and Trike. The focus is on the lower price range and on models designed for customization with parts and accessories.
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