NEW YORK–(BUSINESS WIRE)–H Partners Management, LLC (“H Partners” or “we”), one of the largest shareholders of Harley-Davidson, Inc. (NYSE: HOG) (“Harley-Davidson” or the “Company”), which beneficially owns approximately 9.1% of the outstanding shares of the Company, today issued the following statement in response to a report issued by Institutional Shareholder Services (“ISS”) in relation to Harley-Davidson’s upcoming Annual Meeting of Shareholders (the “Annual Meeting”). The Annual Meeting is scheduled for May 14, 2025.
H Partners commented:
“We strongly disagree with ISS’ erroneous view that shareholders are well-served by having the Company’s next CEO selected by entrenched directors who have overseen significant value destruction during their multi-decade tenures on the Board. ISS’ recommendation does not reflect feedback we have been receiving from fellow shareholders. Since launching our campaign for change at Harley-Davidson, we’ve received overwhelming support from the Harley-Davidson community – including fellow shareholders, dealers, riders and former and current employees – who share our concerns.
The reality is that CEO and Chairman Jochen Zeitz, Presiding Director Thomas Linebarger, and 29-year director Sara Levinson have overseen substantial underperformance, weak strategy execution, and flawed corporate governance that caused damage across stakeholder groups and made clear that change is overdue.
Poor Performance: The Company has delivered negative TSR over every relevant timeframe since Mr. Zeitz was appointed CEO five years ago, and each of these directors has an alarming record of dramatic underperformance. Under Mr. Zeitz, Mr. Linebarger, and Ms. Levinson, the Company’s shares underperformed the S&P 400 Consumer Discretionary Index by -335%, -403%, and -816%, respectively.1 After 18, 17, and 29 years on the Board, respectively, it is clear that this level of underperformance cannot be blamed on a prior management team. Similarly, macroeconomic headwinds are simply not an excuse for the Company’s poor performance when motorcycle registrations are up 23% for every motorcycle manufacturer except Harley-Davidson since Mr. Zeitz took over as CEO.2
Weak Execution: While we supported Mr. Zeitz’s Hardwire Strategic Plan when it was announced in February 2021, the Company’s failure to deliver profitable growth or shareholder value demonstrates that execution has failed. This is further evidenced by the fact that Mr. Zeitz is tracking significantly below each of his Hardwire financial targets and dramatically lowered guidance three years after providing long-term guidance with the Hardwire Plan.3 In addition, the Company also missed or cut guidance in six of the last nine quarters.4
Flawed Corporate Governance: In our view, the nearly two-decade overlap among these three directors has rendered them unable to hold each other accountable for chronic underperformance and raises serious questions about their independence. It is clear to us that allowing an underperforming, outgoing CEO and two long-tenured, entrenched directors to select the Company’s next CEO will only erode shareholder value further. In fact, more than $9 billion in equity value has been destroyed following two CEO succession processes overseen by Mr. Zeitz, Mr. Linebarger, and Ms. Levinson in their capacity as directors over the past decade.5
Damage Across Stakeholder Groups: Under Mr. Zeitz’s leadership, each of Harley-Davidson’s key stakeholder groups has suffered. Employees have experienced a revolving door of senior leadership, a mass exodus of passionate and loyal team members throughout the organization, and a cultural depletion exacerbated by Mr. Zeitz’s decision to shutter the iconic Juneau Ave. headquarters in Milwaukee. More than half of U.S. dealerships were unprofitable in 2024, and dealer sentiment is near a decade-long low.6 Customers have been negatively impacted by declines in bike values and the elimination of entry-level products has made it harder for riders to join the Harley-Davidson community. Lastly, shareholders have suffered more than $2 billion in equity value destruction under Mr. Zeitz’s CEO tenure.
Importantly, we want to make clear that this campaign is not about our CEO candidate, and it is not about H Partners’ Board seat. We are running this campaign with one simple goal: to send a strong message to the Board that shareholders are dissatisfied with the status quo and that meaningful changes to the Board are necessary in order to put Harley-Davidson on the path to value creation.
We encourage shareholders to join us in voting WITHHOLD on the election of Mr. Zeitz, Mr. Linebarger, and Ms. Levinson to send a strong message to the Board that urgent change is needed at Harley-Davidson. Together, we can return this iconic American company to greatness.”
