Many people do not understand the company/dealer relationship, they think the dealer is in total control. Companies do a lot of things to get the dealer to take bikes they may not want. Often they require the dealer to take some of the slow moving models when they just want to order some of the hot ones. Order one of these and you have to take two of those. The dealer sells the hot one and the others sit unsold. If you know a dealer, sit down and talk to him sometime. It can be interesting. If you wonder why some dealers have a lot of bikes no one wants and none of the ones everyone wants, there’s your answer.

Also, companies report sales when the bikes are gone from their inventory so they have more incentive to push the bikes out to dealers who end up holding the bag and then the whole thing starts over the next year.

If productions slows or stops for any reason, strikes included, the dealers can breathe a sigh of relief while they have the opportunity to sell off the backlog of slow movers since the hot ones are all gone and customers still want a new bike of some sort and may buy their second choice, instead.

If production is turned off too long then trouble begins and profits go down for everyone but as long as dealers are sitting on unsold bikes, there’s no rush to fill the pipe again.

“Dealers view the strike as a potential positive. While we have not yet completed a comprehensive dealer survey, dealers seem to think that the strike lasting a few weeks would be good for their business. We view this as a reflection of full dealer inventory levels, a more challenging pricing environment and the timing of the strike (i.e., during the seasonally slow time of year).”

- Edward Aaron, director of equity research, RBC Capital Markets, in a Feb. 6 research note

“Dealer inventory levels are too high – Based on our surveys, Harley dealers are more concerned about dealer inventories than at any point in the past – Harley therefore cannot keep loading up the channel to achieve earnings indefinitely.”

- Gregory Badishkanian, analyst,Citigroup Institutional Investor Group, in a Jan. 18 research note

If you do not understand this, talk to a dealer.

I agree that the company (HD) may benefit in the short term, but I don’t see any short term benefit for dealers. In fact, companies regularly schedule those actions that might provoke a negative response from their employees (like reducing pay/benefits) to those times that they think will be most beneficial to the company. In this case, I think they made a serious error by attempting to reduce pay/benefits immediately on the heels of astoundingly huge company profits.

You seem to think I’m taking sides. I’m simply pointing out a factor that favors the company and not the union in this particular situation. This is not a forum for union versus management debates and I am not going to enter into one.