H Partners, a key shareholder in Harley-Davidson Inc (NYSE:HOG), is preparing to launch a campaign aimed at overhauling the company’s leadership structure. The investment firm, which holds an approximate 9% stake in the motorcycle manufacturer, plans to encourage shareholders to withhold votes for CEO Jochen Zeitz and two long-standing board members during the upcoming annual meeting in May.

Campaign Goals

• Leadership Changes:

  • H Partners is advocating for the immediate resignation of CEO Jochen Zeitz, aiming to revitalize the company’s leadership to better engage customers and dealers.

  • Shareholders are being urged to withhold their support for Zeitz and directors Thomas Linebarger and Sara Levinson, signaling a desire for fundamental changes.

• Critique of Corporate Culture:

  • Jared Dourdeville, an H Partners executive who recently resigned from Harley’s board, criticized the company’s work-from-home culture and high rate of leadership turnover, warning of “cultural depletion.”

  • Activists argue that Harley’s shares have fallen around 30% during Zeitz’s leadership, with ongoing sales declines further underscoring the need for substantial leadership changes.

• Corporate Response:

  • Harley-Davidson expressed caution, stating that the activist campaign might disrupt its ongoing CEO search and longer-term strategies, indicating concerns about organizational stability.

Market Context

This activist initiative arises at a time when Harley-Davidson is facing weak quarterly results and internal restructuring efforts, incorporating job cuts. The push reflects broader investor worries regarding the company’s strategic direction and its capability to combat declining sales in a fiercely competitive motorcycle market.

Future Considerations

As the annual meeting in May approaches, investors will closely monitor H Partners’ ability to gain traction for substantial leadership changes. For further insights on Harley-Davidson’s financial performance and strategic direction, consider exploring detailed filings on entreprenerdly.com.