H Partners Management, a significant shareholder in Harley-Davidson, has called for major changes to the company’s board, recommending the removal of CEO Jochen Zeitz along with two other long-standing board members. The firm is encouraging fellow shareholders to vote to “withhold” their votes during the upcoming shareholder meeting in May, where the re-election of Zeitz, Thomas Linebarger, and Sara Levinson will be determined.
H Partners, which owns approximately 9.1% of the motorcycle company, highlighted its dissatisfaction through a filing with the Securities and Exchange Commission (SEC), stating that a withheld vote would signal the need for substantial changes. Jared Doureville, a principal of H Partners, previously served on Harley-Davidson’s board from February 2022 until his resignation earlier this month.
In a letter to shareholders, H Partners expressed its desire for Harley-Davidson’s board to immediately replace Zeitz with an interim CEO until a permanent external candidate is appointed. The firm criticized Zeitz for being an absentee CEO and questioned the decision-making capabilities of the current board, which it described as tightly controlled by a small group.
Harley-Davidson announced earlier that it has begun the process of selecting a new CEO, following Zeitz’s declaration last year of his intention to retire. H Partners attributed the company’s poor performance to Zeitz and Linebarger, criticizing their alleged lack of transparency with the board and their entrenched positions. The firm expressed concern that if the board, in its current composition, selects the new permanent CEO, shareholder value might continue to be adversely affected.
As of Wednesday, Harley-Davidson shares had decreased by over 24% since the year began and experienced a 42.7% decline over the past year. In early February, Harley-Davidson reported 2024 revenue of $4.12 billion, marking a 14.9% decline from the previous year, with net income reduced to $455.36 million.
In response to the financial situation, Zeitz indicated that the company faced cyclical headwinds affecting consumer confidence, including a high-interest rate environment. Harley-Davidson forecasts its revenue for 2025 to be flat or potentially decreasing by up to 5%.
Fox Business has reached out to Harley-Davidson for comment regarding these developments.
