Harley-Davidson Addresses Former Board Member’s Criticism

Harley-Davidson quickly addressed the resignation letter from its former board member, Jared Dourderville. In summary, the company asserts that Dourderville was aware of many concerns he raised in his letter but did not articulate any issues until recently. The motorcycle manufacturer provided an extensive rebuttal to Dourderville’s claims, highlighting that he had not expressed worries about several cited issues before now.

Harley’s Response

In reply to the letter, Harley presented a detailed account of facts, stating:

1. “Until December 2024, Dourderville and representatives from H Partners were urging Presiding Director, Tom Linebarger, and Chairman and CEO, Jochen Zeitz, to prolong their commitment to lead the company transformation for several more years.”
2. “During a Board meeting in February 2025, Mr. Dourderville supported the reelection of all current Company Directors without any discussion or objection. Simultaneously, while the Board sought a successor for the Chief Executive Officer, Mr. Dourderville and H Partners continued to endorse a long-term commitment from Presiding Director Linebarger.”
3. In late March 2025, the Board assessed three candidates for the CEO position but opted not to extend any offers.
4. Mr. Dourderville did not oppose the majority of the Board on the matters raised in his letter. Throughout his three-plus years on the Board, he only voted against the majority on one occasion – regarding the Board’s decision not to extend an offer to his preferred CEO candidate. Here’s the timeline of Mr. Dourderville’s resignation from the Board:
   4.1 On March 26, 2025, the Board met with three candidates for the CEO role.
   4.2 On March 28, 2025, the Board convened to ensure each Director fulfilled their fiduciary duty to act independently and in the best interest of shareholders. After reviewing the CEO candidates, the Board decided against offering any of them the position.
   4.3 On the evening of April 1, 2025, Mr. Dourderville sent a letter to the Board demanding the immediate resignation of three Directors.
   4.4 On April 3, 2025, the Company submitted its proxy statement recommending the reelection of all current Directors. That day, the Board emailed Mr. Dourderville to inform him they were thoroughly evaluating the points he raised and proposed times for a full Board meeting to discuss them. Mr. Dourderville did not respond to this email or object to the plan.
   4.5 On April 4, 2025, Mr. Dourderville agreed to attend a Board meeting on April 7, 2025, at 7:00 a.m. central, to discuss his April 1, 2025 letter and demands.
   4.6 On April 5, 2025, Mr. Dourderville resigned from the Board before the agreed meeting could take place.
5. The Company is currently in the final year of the Hardwire, its five-year strategic initiative (2021-2024). Throughout his tenure, Mr. Dourderville did not express concerns regarding the Hardwire strategic plan in Board discussions, and he acknowledges in his resignation letter that aspects of the plan were “central to his firm’s investment thesis.”
6. The company has effectively executed the Hardwire, revitalizing the brand amidst one of the toughest operating environments in its history. Although it has struggled to meet its financial goals due to the difficult market conditions, it has achieved a better total shareholder return than all but one of its competitors in the motorcycle and powersports sectors.
7. As the Company continues to adapt its operating model and work culture, it has primarily employed a well-known hybrid and remote work model for certain salaried positions since Mr. Dourderville joined the Board in February 2022, enabling the Company to tap into national and international talent pools. Mr. Dourderville never raised any concerns about this approach during Board meetings.

Jared Dourdeville’s photo is no longer part of the board lineup. Photo: Harley-Davidson

Truth, Spin, Or A Mixture Of Both?

Only those present in Harley-Davidson’s boardroom are privy to the true nature of events during Dourdeville’s time as a board member. The company maintains that Dourdeville aligned with most majority decisions, with operations running smoothly until December 2024. If that is accurate, what prompted Dourdeville to depart Harley-Davidson’s board so abruptly?

Looking At Harley-Davidson’s Side Of The Story: Commentary

Without first-hand attendance at Harley’s board meetings, it’s challenging to determine the underlying realities of this situation and whether any allegations from either side have merit. Therefore, the only conclusions that can be drawn with any degree of certainty pertain to external events.

It’s noteworthy that Harley claims it “…has successfully executed the Hardwire, rejuvenating the brand during one of the most challenging operating climates in the Company’s history.” Depending on the definition of success, some might perceive Hardwire as a failure rather than a triumphant strategy. The stated purpose of Hardwire is to establish Harley-Davidson as “one of the most desirable brands in the world.” However, with ongoing declines in sales and revenue, it could be argued that claiming success for the Hardwire initiative is indeed optimistic.

The statement about Harley delivering a better total shareholder return than nearly all its peers in the motorcycle and powersports sector warrants clarification. We need to identify which companies Harley considers to be its peers. Are we focusing solely on cruiser manufacturers or encompassing all motorcycle makers in the U.S. and globally?

In the U.S., motorcycle sales have generally remained stagnant, yet Harley-Davidson’s figures have declined. Over the past year, Harley’s stock has plummeted from $41 to roughly $21, nearly halving its value. When Zeitz assumed the role of CEO, Harley reduced its dividend from $0.38/share to $0.02/share. Since 2021, the company’s dividends have gradually returned to around $0.18/share and stabilized. Thus, while dividends have increased and become relatively steady from a dividend standpoint, they are still less than half of what they were in March 2021.

What’s The Truth?

The exact truth of this situation remains elusive. It’s clear that Dourdeville perceives issues within Harley’s board, yet the current board appears to disagree. Keep an eye on this developing story; it promises to be intriguing.