Harley-Davidson Inc said on Friday that 2007 earnings would come in 4 percent to 6 percent lower than last year because of a sharp slowdown in August retail sales, and the motorcycle company's shares fell as much as 9 percent.
The outlook cut comes as the US economy faces tightening credit markets, a housing slump and employment worries. Harley said the general uncertainty seemed to be prompting consumers to hold off on discretionary purchases like its high-end motorcycles, which can cost upward of $20,000 for top-of-the-line models.
The company said it expected 2008 earnings to rise by 4 percent to 7 percent and withdrew its 2009 outlook. In July, it had forecast growth of 11 percent to 17 percent for the two-year period.
"We entered August, and there was a sharp decline in retail sales," Chief Executive Jim Ziemer said in a phone interview. While declining to provide a specific number, Ziemer described the percentage drop as "double-digit."