Harley-Davidson revenues fall in warning

Harley-Davidson announced on Wednesday that earnings are lower than expected and that the company would be cutting production in 2005.

This news sent shares of the Milwaukee-based motorcycle manufacturer down 17 percent, and at midday its price per share sat at $48.84.

Second-quarter sales are estimated to be lower than last year based on flat first-quarter sales in the U.S.

Earnings are still expected to be up by 5 to 8 percent, which is under earlier estimates of a 15 percent gain for the year.

Most of the decrease in production, which might jeopardize Harley’s goal of producing 400,000 bikes in 2007, will occur in the second quarter.

Jim Ziemer, currently Harley-Davidson’s CFO and soon to be the company’s chief executive, insists that the company’s goal of 7 to 9 percent per-unit growth over the long term will not be affected by any of this news.

Harley-Davidson expects that it will ship 329,000 units in 2005, up 3.7 percent from 2004 but still 10,000 units fewer than predicted.