By Rajesh Kumar Singh and Ankit Ajmera
(Reuters) - Harley-Davidson Inc (NYSE:HOG) reported a lower-than-expected quarterly profit on Tuesday amid a prolonged struggle to revive demand for its bikes in the United States where sales dived yet again, sending its shares down over 6 percent.
The Milwaukee-based company reported an adjusted profit of $0.17 per share in the fourth quarter. Analysts surveyed by Refinitiv, on average, expected the profit to come in at $0.28 per share.
Revenue from motorcycles and related products fell 8.7 percent to $955.6 million.
Retail sales in the United States, which accounts for more than half of the company's sales, fell 10.1 percent in the fourth quarter ended Dec. 31, more than the 8.3 percent decline expected by analysts.
Harley's demographic challenges in the domestic market are well documented - core customers are growing older and outreach efforts to attract new and young riders have yet to show results.
To offset weak demand in the domestic market, it is trying to grow sales overseas. However, those efforts have yet to bear fruits as sales in foreign markets fell 2.6 percent in the latest quarter from a year ago.
After missing its shipments guidance last year, Harley expects to ship up to 222,000 motorcycles globally this year, its lowest in eight years.
Analysts on average were expecting 2019 shipments of 228,190 motorcycles, according to research firm Consensus Metrix.
To woo the next generation of riders, the company is betting on the small but growing market for electric bikes. Its LiveWire electric bike is now available for pre-order in the United States at a price of $29,799, with delivery expected this fall.
But with electric motorcycles available at around $10,000, along with a worsening outlook for the economy and rising interest rates, the bike might not be affordable for many riders.
While the pricing strategy is aimed at retaining Harley's "premium" tag as well as preserving profit margins, analysts and some dealers reckon it is hurting sales.
A recent dealer survey by Goldman Sachs (NYSE:GS) found demand for used, cheaper bikes are growing at the expense of newer ones.
Against this backdrop, President Donald Trump's call to boycott the motorcycle manufacturer for its decision to move production for European markets overseas has only compounded the company's troubles.
The company's shares have fallen about 30 percent since the beginning of 2018. The stock was last trading down 6.6 percent at $34.2 in premarket hours.