Harley begins looking out of state
already has begun examining out-of-state locations as it moves deeper into the process of deciding whether to keep manufacturing in Wisconsin.
Harley-Davidson spokesman Bob Klein said the Milwaukee-based motorcycle manufacturer would prefer to remain in Wisconsin but, nonetheless, has begun an “in-depth analysis” of alternate sites in the event the company isn’t able to achieve the necessary solutions needed to improve the efficiency and cost-competitiveness of its Wisconsin operations.
“We are early in the process, but we are starting to do a deeper dive,” Klein said.
Harley-Davidson management would like to have a decision by fall on whether it will be necessary to move manufacturing out of Wisconsin. At stake are nearly 1,700 jobs, including more than 1,300 in the Milwaukee area.
Harley-Davidson began an intensive examination earlier this year of its operations in Menomonee Falls and Tomahawk.
The $4 billion-plus company already is consolidating its powertrain production operations at the Menomonee Falls factory. The move will lead to the closure of the company’s factory in Wauwatosa.
Despite the consolidation, there are “significant gaps” that remain in the competitiveness of Harley-Davidson’s local operations, Klein said.
Harley-Davidson has implemented several major changes over the past year in an effort to remain competitive and profitable in the face of one of the worst economic recessions in U.S. history. The company has cut hundreds of jobs, closed its Buell Motorcycle Co. subsidiary in East Troy and is attempting to sell MV Agusta, its Italian sport motorcycle subsidiary.
The company also undertook a major restructuring of its motorcycle assembly operations in York, Pa., which it launched after conducting an analysis similar to the one now being conducted in Wisconsin.
After a seven-month process, Harley-Davidson decided to remain in Pennsylvania, but only after reaching an agreement with union-represented workers that will slash the work force from 1,950 employees to about 1,000 hourly workers. Several buildings at the York complex are being shuttered as a result of the outsourcing of nonessential operations.
Harley-Davidson initially had considered four alternate locations: Kansas City, Mo.; Shelbyville, Ind., near Indianapolis; Murfreesboro, Tenn., in suburban Nashville; and Shelbyville, Ky., near Lexington. Harley-Davidson eventually narrowed its focus to the Kentucky location before deciding to remain in Pennsylvania.
Klein declined to say whether the Kentucky site, or any of the other communities previously examined, will be considered as viable alternatives for Harley-Davidson’s manufacturing operations in Wisconsin.
Calls to the offices of Kentucky Gov. Steve Beshear and Shelbyville Mayor Thomas Hardesty were not returned.
Already meeting
News of Harley-Davidson’s plans has local political and business leaders scrambling to keep Harley-Davidson from moving manufacturing out of the region where the company was founded in 1903.
“We have been communicating with the company,” said Pat O’Brien, executive director of Milwaukee 7, an economic development group for the seven counties in southeast Wisconsin.
O’Brien declined to reveal details of the discussion with Harley-Davidson management, but he said it’s important to the local economy that the company keep its good, high-paying jobs in southeast Wisconsin.
Harley-Davidson also is vitally important to the area because it has its headquarters here.
“We like to take care of our own,” he said.
O’Brien pointed out that the prolonged weak economy has created financial woes for Harley-Davidson and has forced the company to make difficult decisions about its future.
“We’re sensitive to their manufacturing needs,” O’Brien said. “We’re trying to respond to that, but ultimately it’s their decision.”
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