Bloomberg Intelligence Harley Davidson Shares Soar on Captive Deal
Jul 30, 2025
The podcast dives into the surge of Harley Davidson’s stock after a major financial deal, revealing how the funds will be used for share repurchases and debt reduction. It also tackles Kraft Heinz's strategy of using price increases to counteract volume drops. Insights on Starbucks highlight their unexpected drop in sales but promise of major innovations ahead. Tesla's landmark $4.3 billion battery agreement showcases the evolving landscape of energy and automotive markets, tying these developments to broader economic challenges.
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Harley Captive Finance Profits
- Harley Davidson's captive finance business generates over half its profits, more than manufacturing motorcycles.
- The $1.25 billion stake sale to KKR and Pimco reflects strong value in this financing segment.
Harley Manufacturing Challenges
- Harley's motorcycle manufacturing sales declined 13% over 10 years and margins fell sharply from 20% to 5%.
- Attempts to expand beyond their core older demographic have eroded their brand and profitability.
Tariffs Affect Entire Supply Chain
- Tariffs impact the full supply chain, but costs ultimately fall on consumers.
- Retailers and companies absorb some costs but have limited bandwidth, making consumer price increases inevitable.