The news that Harley will ' float ' LiveWire as an entirely separate legal entity has taken many , including me , entirely by surprise . The solution that has been arrived at and the distance traveled to deliver it so quickly is stunning , frankly . Once you drill down and follow the logic of the structure to be used it has good sense written into its DNA . Leaving aside the sometimes derided nature of the ' SPAC ' ( Special Purpose Acquisition Company ) as a way-to-market vehicle , it is going down an equity-share joint venture route that gets my attention . At long last , we have a Harley management team that is fit for purpose in a 21st century in which all the orthodox ' Not Made Here ' tropes are being jettisoned . As with its partnership with Qianjiang Motorcycle Company , Harley is drinking from a well of JV thinking that is commonplace at a time when it needs to be commonplace . At times of great commercial and manufacturing change , Harley is pushing forward-facing buttons in spades . As solutions go , the way Harley ' s management has chosen to embrace collaboration is uncharacteristic and bold in equal measure . Compliments to the chefs , I say ! The partners they are signed up with - in investor and private equity terms - appear to be ' robust '. I didn ' t know anything about either AEA Investors or Bridges Fund Management before , and from the limited amount of research I was able to do in the available time , they both appear to be ' righteous '. I do know more about KYMCO though . Of the Asian majors , they are a business to be admired . The company ' s Chairman Allen Ko is an entrepreneur who is respected and revered . When it comes to the powersports industry ' s ' Electrification Space ' there are not many corporations with twice the 10- year longevity at it than Harley itself has , and technologies like its IONEX swappable battery program is one of the breakthroughs in a market in which GOGORO is currently the pacemaker . While the concept of swappable batteries does not specifically rear its head in Harley ' s S2 , S3 or S4 Arrow platform architecture development plans , it would be a surprise if LiveWire didn ' t at least embrace it at the low power end of the electric PTW market , initially and especially in Asia . Indeed , proto-rivals such as Honda , Yamaha , Piaggio and KTM are taking it very seriously , and targeting the products their consortium builds for use in shared platform technology in Europe . For my money , if Stefan Pierer ( KTM ) and Michele Colaninno ( Piaggio ) are taking it seriously ( to say nothing of Honda and Yamaha ), then so should everybody else . Modular architecture is very much the way of the future in the EV market , especially in the powersports market , and with its Arrow platform , Harley is giving LiveWire a ticket to the Ball , and KYMCO will be the perfect dance partner . However , there is just one small fly in the ointment as I have understood the plans so far . The consensus in Europe , indeed globally , is that it will take mandatory
100,000 units in five years
compulsion to end the production of internal combustion engine vehicles . Only then will we see critical mass for electrification . The prospect of the international motorcycle industry seeing substantial adoption of electrification in the short-term ( five to ten years ) remains debatable . The LiveWire investor presentation uses growth projections that appear optimistic at best . From sales of 387 LiveWire units and income of $ 33m in 2021 , Harley is projecting that LiveWire will sell 100,961 units worth $ 1.769bn as soon as 2026 - just five years from now . This is then slated to double to approx . 190,000 units by 2030 ( worth around $ 3bn in total revenue ). These forecasts are " management projections ", not industry forecasts , and it is unlikely that the world ' s motorcycle industry trade associations ( including the MIC in USA and ACEM in Europe ) would recognize such a forecast from their own and their members ' research efforts , or be comfortable associating themselves with such forecasts . Harley is betting the farm on being able to " grow the market by expanding the product portfolio " - a ' build the bikes and the consumers will come ' piece of wishful strategic thinking that we have seen from Harley before . Harley is gambling that " younger " and " new-to-sport riders " will tip the balance in their favor . In fact , all the research that AMD sister magazine International Dealer News is seeing in Europe , from Asia and even from the United Nations , in terms of urbanization trends , suggests that the real opportunity is with suburban and peri-urban commuters . A market which largely ( though not exclusively ) requires longer-term settled residence and developed career status than that which characterizes " younger " riders ( who tend to nest closer to downtown ) and the ability to spend at better than entry level price-points . I ' m afraid to have to say that the market research evidence cited in Harley ' s investor prospectus is thin , and that without an ICE endgame target date translating consumer environmental sentiment into units sold is dangerous . That is the plan ' s Achilles Heel right there .
Robin Bradley
Co-owner / Editor-in-Chief robin @ dealer-world . com