High Gas Prices May Help Harley-Davidson: More Evidence

In early March, I posed the question "is $3.25 gas helping Harley Davidson?" Now that the price is up to $3.50 and higher in most areas, there is more evidence unfolding that it may be true.

In the first post, it was an Illinois dealership reporting increases in sales. Now we have both a California dealership and, even better, a Florida insurance agency that insures motorcycles in 21 states, reporting the same thing.

The fact that the reports are coming in from both the sellers of the bikes and insurers in such regionally diverse areas has to assure investors that this is not a specific trend to a specific dealership or area but more of a widespread one.

Some of the comments I got after the first post were of the "a Harley gets the same mileage as my Prism" variety and, well, ring hollow. The simple reason is that I do not know too many drivers of Prisms, Escorts or other gas-saver vehicles who own and drive a Harley. I do know plenty of F150, Suburban and Silverado drivers who do. In that case, they are doubling or even tripling their gas mileage and savings by making the switch.

Harley Davidson (HOG) recently lowered full year guidance (see earnings call transcript) to a level that, as gas prices continue their climb, I think is going to prove way too conservative as the year unfolds.

Disclosure: Long HOG

Comments

[drmalaka]

I was at the Harley dealer near me recently and was asking about sales and he said the same thing, gas prices were helping sales. Don't know if this is proof positive, it might be part of a company talking points memo, but he did echo this post.

[farfignewton]

My V-Rod gets 44 mpg. I've got an 80 mile round trip commute daily. it sucks to be me sometimes... ;-)

[GraqntHudlow]

Enter your comment hereALLIED SCIENCE, INCORPORATED
P.O. Box 2629, 4161 Mary Lou Street, Pahrump, Nevada 89041
alliedscience.org Telephone: [phone] E-mail: [e-mail]


Form Project Summary

Project Name:
Allied Science, Incorporated Coal Fired Powerplant Stack Project
Operate commercial factories that convert the smoke and pollution from the stack of a coal fired powerplant to gasoline and diesel in a sealed system.

General Introduction:
Grant Hudlow FOUNDER,CEO
One person can make a difference, has been the driving philosophy for the life of Grant Hudlow. It was this mind set that led to the birth of Allied Science, Incorporated in 1989. Now, nearly two decades later, with a financial commitments base exceeding $7.5 billion, Allied Science, Incorporated carries it’s message of wholesome, values- oriented products across the United States, Canada, and Europe.
“When we reach people, if we can sell a product, great, but we are first and foremost about spreading our message, “ says Mr. Hudlow. “We want people to know that there is an alternative to the sex, violence and profanity that is in so many homes today.”
Mr. Hudlow attended California Institute of Technology and the University of Nevada at Reno
Before spending 13 months on the Korean DMZ, then an industrial turn around expert with Proctor & Gamble, Stewart Warner, Fuller Paint and Fairchild Semiconductor.
Mr. Hudlow left big business to create Allied Science, Incorporated after realizing the need for uplifting, wholesome discussions that carry a positive messages. “I knew this was something I had to do,” Mr. Hudlow says. Creating Allied Science, Incorporated was more of an important work decision than a business one.”
Mr. Hudlow has since named the chemistry to make this new industry possible, lead the design engineering, sold $7,500,000,000 in orders for factories and sold $7,000,000 in orders for the products from the factories around the world. Armed with the belief of his convictions, he has grown Allied Science, Incorporated from a dream to a major international corporation with more than 200 alliances.
Mr. Hudlow enjoys assisting young people in their entrepreneurial aspirations as well as working with and training school teachers and other professionals. His professional accomplishments and community service have been recognized by local churches and local civic organizations.
Mr. Hudlow has two children and one grandchild.
A little know fact about Mr. Hudlow is his love numbers and statistics. Retired CEO, S.B. Devlin says, “No one sees through a problem faster than Grant. He’s a true statistical genius.”

Terry Ellis, Sr.
has valuable engineering and construction contacts. He has hands on management and business experience with Fluor Daniels, Brown & Root and others

Dr. Chuck Baroch,PhD Chemical Engineering, is a retired CEO with Babcock and Wilcox.

Dr. Davis Clements, PhD, is a Chemical engineering Professor at the University of Nebraska in Lincoln, Nebraska.

Gary Smith is a highly regarded Chemical and Petrochemical Engineer with quality contacts and broad work experience. His experience ranges from blending his own gasoline for resale to employment with major chemical companies such as Dow, Dupont and Union Carbide. Mr. Smith has a BS and MS in Chemical Engineering from the Georgia Institute of Technology. Mr. Smith assists with the engineering and construction of the total project and with the management of the complex.

Lawrence G. Erskine, President Bionomics International,Inc., enjoys a solid management and marketing reputation in the USA, China, Japan, Singapore, New Zealand and Australia. Mr. Erskine owns and operates a Hazelnut business in the state of Oregon and ships finished (value added) Hazelnut products around the world. He imports and exports equipment. Mr. Erskine spent 10 years in management with General Foods Corp. He attended the University of Oregon, obtained a BA in marketing from Northeastern University and attended an accelerated MBA (equivalent) course from Harvard University, via General Foods Corp.

Al Avolicino coupled his education in art with his management and leadership skills to become marketing and advertising manager for some of the largest companies in the U.S. Mr. Avolicino will devote his time to establishing contracts with waste generators and creating the necessary educational campaigns. He will hire and train the marketing and sales people. Mr. Avolicino has enjoyed management positions with such companies as General Foods Corp., Servatron,Inc. and Farmer Brothers,Inc.

Frank Lopez CPA, Lopez and Company,Inc. will be handling the tax and accounting responsibilities for the projects. (Background an resumé available on request)
The Allied Sciences, Incorporated team’s strategic alliances include work with the following:
Elko City Council, Phenol brokers all around the world, Economic developers all around the world, BISNIS, USDOC, USDA, US EX-IM Bank, University of Nebraska, Lincoln, UNLV, UNR

3. Funding Request:
$100,000,000 to build, debug and operate a factory that makes $490,000 a day by converting the smoke and pollution from the stack of a coal fired powerplant to 40,000 barrels a day of gasoline and diesel that sells for $.55 a gallon wholesale

Term:
First tranche: $100,000,000 (to get environmental permits $7,000,000 engineering fee: to buy the equipment $32,500,000; to build the plant $25,000,000 labor and $15,000,000 contractors fee; to debug $8,200,000; operating cost to profitability $12,300,000.

Community Impact:
Allied Science will bring 400 new jobs initially; A $20,000,000 annual payroll; A chemical engineering lab to the local community college; Computers to local children; And money for local infrastructure as needed. In a nutshell, Allied Science, Inc. serves the community by contributing a significant portion ( which has been factored into the base product cost and does not affect returns) of the revenues generated from the factory going to support local charities, help fund community City and State Public Services, as well as supporting biotech and medical research organizations.

Environmental:
With the allied Science,Inc. facilities, there is NO burning, therefore NO smoke stacks. NO smoke stack means No air pollution. The residuals are distilled water, which is evaporated, and results in an ash which is stored and conditioned for one year after and is used as a non-toxic powder to strengthen roads, make 19,000 lbs. concrete, and for strengthening wallboard.

Specific Performance:
From date of initial funding, Two months to get environmental permits ; Three months to buy the equipment ; Six months to build the plant; Two months to debug ; Three months to profitability.

Exit Strategy:
At end of fourteen months after funding, Allied Science, Incorporated will contractually begin to return 150% of the amount funded for each project. Allied Science, Inc. expects to complete this process within two years of receiving funding.

Supporting Documents:
15 pages of supporting documents are available on request as an attachment as needed.

10. Letter of Introduction from Bank available at later date.

[bill d]

What the hell is the previous post ?
A giant spam letter ?

[Mallarde]

I still do not accept that penny-pinchers are going to go out and buy a $20K motorcycle. The math should be relatively simple. When you finance one of these, what are the monthly payments? How much does a driver of a pick-up truck save in gas money if he has a 15-mile commute and rides the bike 90% of the time.

[todd su]

mallarde,

a used Hog goes for about 7K

[todd su]

mallarde,

a used Hog goes for about 7K

[Mallarde]

And brings in how much revenue to HOG?

[Mallarde]

After more consideration, I would like to officially announce that Mr. Sullivan's hypthesis -- twice posted by him -- is ABSURD. He should think more before pumping his own stocks on the internet as a writer for SeekingAlpha.com.

What percentage of Harley-driven miles are to work or necessary trips versus total miles (as in putting around in front of cafes upsetting people with load pipes)? I would venture 20% max.

And it's the other 80% Sullivan needs to consider. Buying a Harley to show off on the weekends or for road trips to Wisconsin becomes even more expensive after you factor in gas.

[Chris Cross]

At gas prices in the $4.00 a gallon range. My F150 PU gets 17 mpg. I drive 42 miles per day on an average. The cost to drive my truck is $9-$10 dollars each day back and forth to work.

My 2007 Dyna Harley with only Chris-Cross cylinder head technology gets a consistant 64 mpg (this is 20% better than HD OEM) at 42 miles round trip, It will cost me $2.62 each day to ride to work.

That is a $6. and change savings per a day. When I ride 2 days a week........that is $48.00 a month savings. x 6 months of riding weather in Colorado......only$288... but hey save your money where you can.

well worth the effort wouldn't you say Mallarde for something I do not mind doing.

regards
Chris Cross
cleanharley.com

[Mallarde]

Your scenario is not the usual one for commuters, including the mileage you are getting on your Harley. Do they make hybrid Harleys?

I really find it interesting that this gas-costs-will-boost-H... argument seems to have benefited the stock. It is a great example how the "experts" can lack an understanding of the market they analyze, leading them to faulty conclusions.

If the vast majority of Harley-miles are recreational, increased gas costs will discourage people from buying a Harley.

I closed out of some of my short position and am using it as a hedge against this nasty market. Wow. My WB shares are killing my portfolio.


On May 30 04:47 PM chris cross wrote:

> At gas prices in the $4.00 a gallon range. My F150 PU gets 17 mpg.
> I drive 42 miles per day on an average. The cost to drive my truck
> is $9-$10 dollars each day back and forth to work.
>
> My 2007 Dyna Harley with only Chris-Cross cylinder head technology
> gets a consistant 64 mpg (this is 20% better than HD OEM) at 42 miles
> round trip, It will cost me $2.62 each day to ride to work.
>
> That is a $6. and change savings per a day. When I ride 2 days a
> week........that is $48.00 a month savings. x 6 months of riding
> weather in Colorado......only$288... but hey save your money where
> you can.
>
> well worth the effort wouldn't you say Mallarde for something I do
> not mind doing.
>
> regards
> Chris Cross
> cleanharley.com

[Chris Cross]

they do not make Harleys that get as high of gas mileage as my Harley.

Yet.

But if the Harley Davidson does not aquire my technology, they may go the way of the dinosaur.

If Harley Davidson would aquire my technology they would corner the market on all motorcycles above a 500cc engine size.

There are impending Greenhouse Gas laws, and Fuel Mileage requirments that will be imposed by California and the US EPA soon.

I do agree with you Mallarde...the everday HOG rider rides for pure enjoyment. Not to save fuel.

Chris
cleanharley.com