(Reuters) – Harley-Davidson Inc’s (HOG.N) shares slipped 10 percent on Tuesday after the motorcycle maker cut its full-year shipments forecast, underscoring slowing demand as the company’s loyal baby boomer customer base ages.
The Milwaukee-based motorcycle maker, which had previously forecast flat to modestly down full-year shipments, said it expects to ship 241,000 to 246,000 motorcycles in 2017, compared with 262,221 a year earlier.
That’s a far cry from the nearly 350,000 it shipped a year about a decade ago.
Baby boomers, Harley’s main customer base, are aging and the storied motorcycle maker is also up against discounts offered by rivals Indian brand bike maker Polaris Industries Inc (PII.N) and Japan’s Honda Motor Co Ltd (7267.T).
“Given U.S. industry challenges in the second quarter and the importance of the supply and demand balance for our premium brand, we are lowering our full-year shipment and margin guidance,” Chief Executive Matt Levatich said in a statement.
The company said it expected to ship 39,000 to 44,000 motorcycles in the current quarter, suggesting a decline of up to 20 percent.
Harley’s dealers in the United States had too many 2016 models at the end of the fourth quarter, which led the company to limit shipments of its 2017 models, including higher-margin touring motorcycles with the new “Milwaukee-Eight” engine.