Picture the slide. It's LiveWire's first investor day, and the forecast says more than 100,000 electric motorcycles a year by 2026. Now picture the loading dock. By the middle of this year, the company had shipped 358. John Keilman tells the story in Wednesday's Journal, and one number does most of the work.
LiveWire (LVWR) is the electric spinoff of Harley-Davidson (HOG). Harley showed it off in 2014 as a futuristic concept bike. Sales began in 2019, and the critics loved it. In 2021 Harley decided to spin the brand off. The idea was that LiveWire could move at a startup's pace on its own. Sales since then have run to a few hundred bikes a year. The losses since the split top $300 million, by the company's own latest annual report.
This week the bill came due. CEO Karim Donnez resigned last week. On Monday the company said a special committee is weighing its options. It named Roy Gallagher of Ankura Consulting as chief restructuring officer. The stated goal is a full review of “strategic alternatives.” Harley, which still owns almost 90% of the shares, declined to comment. Analyst John Healy of Northcoast Research put it simply. “It's a great concept, but maybe not ready for the masses at this point.”
Why the buyers stayed home
America hasn't taken to electric motorcycles, and it isn't for lack of choice. A decade of new models hasn't changed that. The bikes are quick and quiet. The catch is range, because a small battery runs out fast. Price is the other problem. Harley's first LiveWire carried a sticker near $30,000. Prices have since fallen by more than half, and a gas bike is often still cheaper. The new S4 Honcho lists at $5,000 for the off-road version and $5,500 street-legal. Longtime Harley riders mostly shrugged. Harley also counted on a wave of new riders, and that wave never came.
Our read
This one is about risk (Investments/Risk · IN04). A forecast is a wish with a chart on it. The company that makes it believes it. The analysts who repeat it often believe it too. For a while, 100,000 was the LiveWire number people talked about. Now the number is 358. We don't own Harley or LiveWire in any book, and we're not sorry. The lesson travels, though. Every hot story stock has a slide like that one. Shipments, revenue and cash are the numbers nobody can draw with a marker.
The concrete thing is any stock you own because of what it might do in 2027 or 2030. This week, pull up its last quarterly report and find one number it actually delivered. Compare that number with the promise that got you in. If the gap looks like LiveWire's, keep the position small enough to lose. You don't check the roof in a storm. Bring the list, and we'll check it on a sunny day.