A prominent investor in Harley-Davidson is advocating for substantial changes within the company’s board of directors. The investor is calling for the removal of CEO Jochen Zeitz along with two other long-standing board members.
On Wednesday, H Partners Management urged fellow shareholders of Harley-Davidson to vote “withhold” at the upcoming shareholder meeting scheduled for May, where Zeitz, Thomas Linebarger, and Sara Levinson’s re-elections will be decided.
H Partners holds approximately 9.1% of the motorcycle manufacturer’s shares. One of its key figures, Jared Doureville, served on Harley-Davidson’s board from February 2022 until his resignation earlier this month.
According to its filing with the Securities and Exchange Commission, a “withhold” vote from shareholders would convey significant dissatisfaction with the current state of the board and indicate a demand for effective change.
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In a letter made public, H Partners urged that Harley-Davidson’s board should take swift action to “remove” Zeitz and appoint an interim CEO while searching for an external permanent replacement.
The firm expressed concerns regarding Zeitz’s leadership, stating, “We believe an absentee CEO who has already announced his intention to retire should not be making decisions that could affect the long-term prospects of the business.” Additionally, H Partners asserted that the current board, dominated by a small group of long-standing members, lacks the capacity to govern effectively, especially regarding CEO succession.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| HOG | HARLEY-DAVIDSON INC. | 22.43 | +0.81 | +3.77% |
Earlier this month, Harley-Davidson disclosed it is actively seeking a new CEO to replace Zeitz, who communicated his decision to retire at the end of last year.
H Partners pointed to “poor performance” within the company, attributing some of the blame to Zeitz and Linebarger, highlighting a failure to adapt to necessary changes.
H Partners also criticized Zeitz, Linebarger, and Levinson for a lack of transparency and maintaining an insular board that fails to hold its members accountable for underperformance.
The filing emphasized the investor’s fears that the current board structure could jeopardize the selection of a new CEO, perpetuating the existing strategic direction and potentially causing further financial decline for shareholders.
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Since the beginning of the year, Harley-Davidson’s stock has plummeted over 24%. Over the past year, the company has seen a staggering decline of 42.7% in its shares.
H Partners stated its belief that it is critical to appoint a new leader who can mend relationships with dealers, engage with the riding community, strengthen the brand, and rejuvenate the corporate culture. Additionally, the firm emphasized the need to restore Harley-Davidson’s historic Milwaukee headquarters to its former prominence.
Finance Newso Business has reached out to Harley-Davidson for their input.
In February, the company reported a revenue of $4.12 billion for 2024, marking a 14.9% decrease from the previous year. Its annual net income dropped to $455.36 million.
During this time, Zeitz noted that Harley-Davidson’s performance has been significantly affected by ongoing economic challenges, particularly the impact of high-interest rates on consumer confidence in 2024.
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In its forecast for 2025, the company projected that revenue could remain stagnant or experience a decline of up to 5%.
