Harley-Davidson Inc. will cut about 85 jobs at its Kansas City motorcycle plant — roughly 8.5 percent of its area work force of about 1,000 — as part of broader cuts the company said Friday it will make because of lower profit and sales.
Company spokesman Bob Klein said that about 80 of the jobs are hourly and that five are nonproduction. The layoffs will occur by May 1.
The cuts are part of a plan to eliminate 1,100 positions at production facilities in Milwaukee, Kansas City and York, Penn., the company said in a Friday release.
Of the 1,100 job cuts, about 800 are hourly production workers and the balance are primarily salaried, nonproduction positions. About 70 percent of the planned layoffs are expected to occur this year.
“We obviously need to make adjustments to address the current volume declines,” Ziemer said in the release. “But we are also determined to do that in a way that will make us more competitive for the long term. Our management group will engage with union leaders, through our partnering relationship, regarding these changes.”
The Milwaukee-based company (NYSE: HOG) announced the job cuts in its earnings report for the fourth quarter and all of 2008.
For the quarter that ended Dec. 31, earnings were $77.8 million, or 34 cents a share, down 58 percent from $186.1 million, or 78 cents a share, a year earlier. Revenue for the quarter was $1.29 billion, down 6.8 percent from $1.39 billion the prior year.
For all of 2008, earnings were $654.7 million, or $2.79 a share, down 30 percent from $933.8 million, or $3.74 a share, in 2007. Revenue for the year was $5.59 billion, down 2.3 percent from $5.73 billion in 2007.
Harley-Davidson is trying to adjust its cost structure to meet 2009 motorcycle volume projections that are lower than the total number of units shipped in 2008. The company expects the volume reduction and changes to operations to result in one-time charges of about $110 million to $140 million over 2009 and 2010. Once completed, ongoing annual savings are expected to be about $60 million to $70 million.
The company expects to ship between 264,00 and 273,000 motorcycles in 2009, down from shipments of 303,479 units in 2008. The 2008 total was 8.2 percent lower than the shipment totals of 330,619 units in 2007.
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