So I don’t want to evade you the answer to your question, but, our focus is on growth and profitable growth and that’s how we will complete our hardwired stage two strategy at the end of ’25. What comes after that, we will address at the appropriate time. We do look at market shares, but we’re not obsessed by market shares. I’ve never been never will, but of course, it’s pleasing to see that in this tough environment, especially in the fourth quarter, we were able to grow our touring share back to 75%, large cruiser 80%. That’s commanding. Give or take 5%. That’s always the swing that you’re going to see throughout the year, also on a rolling 12 months forward, or backward and I think that’s likely where we’re going to be, but we believe there’s an opportunity to take market share, especially in touring, and through our trike offering, because we have competitive and great product and that should see a positive development, certainly next year, if all our plans come to fruition and hopefully that will carry through in future years as well, at least until the end of our hardware stage two, which is at the end of ’25.
The touring platform, as I mentioned, has been in development since 2020 and it’s the first refresh and in fact, it’s not a refresh, it’s a complete rebuild from the bottom up in every respect and I think the positive reactions give us that opportunity, but it’s a little early to comment how lasting that is going to be, but we feel very good about it.
Operator: And we have a final question for today from the line of Brandon Rollé with D.A. Davidson. Your line is live.
Brandon Rollé: Thank you for squeezing into my question here. Just a question on your margin guidance, I think you had called out additional manufacturing costs as being a headwind to guidance this year, could you size up, the amount of headwind from those additional manufacturing costs and then provide any additional color on feedback you’re receiving for the model year ’24 line-up? Thank you.
Jonathan Root: Thank you, Brandon. We’ll start with your — we’ll start with your sort of question on what we’re seeing from a manufacturing perspective and some of the noise that we have within there. So obviously, we’ve put a $400 million price target out there from a productivity perspective. We walked through what we’ve seen over the last couple of years and where we envision 2024 landing. So, about $100 million of positivity that lands in 2024 to help offset what we see from an inflationary perspective. As you look at that movement over time, we obviously feel pretty positive about that. When you kind of talk through some of the headwind that we see, if we take a look at what this means from a margin perspective, obviously, depending upon where we fall from an overall volume perspective with our with our fairly wide range is we want to make sure that we are looking at moving our retail and wholesale in concert with each other.
We obviously have a lot that we have to pay attention to from a structural cost and as you think through sort of a leverage or de-leverage impact and so I think from that standpoint, certainly a little bit of noise as we just try to work through what that could mean from an overall leverage or de-leverage impact. And then as we think about manufacturing optimization, supply chain efficiency, as Jochen talked about, this is a this is a transformative launch as you look at the significance of what we have with Street Glide and Road Glide that are that are now hitting our dealers. Obviously, as you have sort of a very, very major change that occurs all the way from your suppliers through to what we end up moving into our dealership. There’s a lot of — there’s a lot of just a lot of change and a lot of variability that can occur with that.
We feel like it’s been a fairly smooth launch so far, but we certainly always want to make sure that we have are living in a world where we’re not over promising to anyone and I think beyond that, Jochen and Edel, do you have questions on or I’m sorry, you have some comments relative to the ’25 model year reception.
Jochen Zeitz: ’24, I’m ahead of time of your time. ’24. Well, look, I’ve not much more to add. Maybe overall, I would say this really positive reaction to our overall pricing strategy with when it comes to the carryover product and our new product. I think that the decisions we’ve taken the fourth quarter will help us in ’24 and I think, unilaterally positive reactions to our new street guide road, lots of excitement about our new CVO ST. We’ve started the trend with performance and picked up on a trend that we saw years ago developing, especially on the West Coast, but in other parts of America as well and we’ve, as I mentioned in my speech, we’ve tried to push that hard with our King of the Beggars race series and our race bike.
So really bring a performance aspect into our product is now shown with our CVO Road Glide ST. Fantastic product, very well priced and lots of excitement. I’ve been riding with a big group of influencers in Las Vegas and there was just a lot of excitement around our touring new touring bikes. I don’t want to forget our first CVO ever outside of the touring category with our adventure touring bike, also a testament to our development on continuous focus and developing the adventure touring market. So overall, we feel good about it and also the pricing in our entry product, Nightster, that we’ve adjusted accordingly, great product, especially for new riders as well as an entry bike. So we should see some positive development that in overall in the year, but as I said, it’s early days.
We don’t want to get overly excited here. ’23 was a tough year and interest rates haven’t changed and the outlook certainly doesn’t suggest that that’s going to happen in the prime riding season. So we’ll have to balance our excitement for the new product with realities of the market.
Brandon Rollé: Thank you. And if I could just follow up on the manufacturing cost question, would you be able to break out the initial startup costs for the new touring production line versus just additional manufacturing costs throughout the year?
Jochen Zeitz: I think all we can say in the largest investment in a single platform that Harley-Davidson ever made.
Jonathan Root: Yep. And I think, Brandon, the good news is that you will hear more from us as we move through the year and talk about our financials and do our kind of year-over-year comp. So in in sort of our in our standard fashion, we’ll make sure that we’re continuing to provide breakouts that we’re seeing, from a revenue perspective. We’ll obviously walk through and talk through the P&L so that the promise that we do make is that throughout 2024, we certainly will be talking about this. And, you know, as you would imagine, 2024 is a little bit noisy when you look at some things quarter over quarter and some of the changes that we envision that we’ll see in terms of things, shipping units into the dealer network and as you know, Jochen talked about throughout his prepared comments and I talked about through mine, obviously getting that match between retail and wholesale is something that we feel is very important.
But, yeah, we’ll be excited to talk about that with you throughout this year.
Operator: Thank you. To close out today, I’d like to hand the call back over to CEO, Jochen Zeitz for any closing comments.
Jochen Zeitz: Yes. Well, thank you, again to everyone for joining us today. Before we sign off, I just wanted to take the opportunity to thank Edel O’Sullivan for her many contributions to the company over the past three years and to wish her very well on her future endeavors. So thank you very much, Edel and thank you all for joining us this morning.
Operator: Thank you. And ladies and gentlemen, this does conclude today’s conference call. Thanks for joining. You may now disconnect. Have a great day.
