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Tiffany Camhi rolls up to work on her motorcycle.
"I could never see myself on a Harley," said Camhi. "They're really loud and super expensive."
The 30-year-old Camhi isn't alone.
Harley-Davidson motorcycles have been a mainstay in the industry since the company was established in 1903 in Milwaukee. But the Hog maker has struggled of late.
Thursday's earnings report marked the end of another difficult year, with the company posting a 6.7 percent decline in worldwide retail sales in 2017 compared with the year before. Motorcycle shipments were also at a six-year low.
Harley lowered its 2018 shipment expectations to a range of 231,000 to 236,000 bikes after narrowly meeting its target in 2017 at 241,498 vehicles. While the company anticipates increased international retail growth this year, retail sales in the U.S. are expected to be down, according to Michael Pflughoeft, manager of corporate media relations for Harley-Davidson.
To try to turn things around, the company has to inspire the next generation of bikers to replace the ones who are aging out. Millennials are proving to be a tough audience: They want smaller, cheaper motorcycles — the antithesis of Harleys.
The issue seems to be a generational one. Baby boomers fell in love with the oversized bikes as the symbol of romance on the open road. But younger generations aren't interested in their parents' motorcycles.
"It's like the Cadillac or the Mercedes," said David Beckel, an AllianceBernstein analyst who tracks Harley-Davidson. "You might turn away from it if you're younger because it's not your idea of cool."
Light-weight, off-road, and electric bikes have gained popularity among riders, according to Jim Woodruff, chief operating officer of National Powersport Auctions, a motorcycle and powersport wholesale channel. So has the minimalist look.
"Ten to 15 years ago, bikes with a lot of plastic were cool," Woodruff said. "Now it's bikes that look more naked."
Last year, in an attempt to give riders what they want, Harley-Davidson launched eight new Softail motorcycles. The consumer response to the line has been overwhelmingly positive, said Pflughoeft.
The smaller, more fashionable bikes, released just in time for the company's 115th birthday, have the same powerful engines as larger Harleys. But some of the motorcycles are as much as 35-pounds lighter than previous models.
During Wednesday's earnings call, the company also announced plans to launch an all-electric line of motorcycles within 18 months. A prototype of the yet-to-be named line of electric motorcycles was released in 2014 as part of Project LiveWire. The new bikes are expected to be faster, quieter and sleeker than traditional Harleys.
"There's been a shift in philosophy," Pflughoeft said.
That shift includes adjusting the mindset from "we build motorcycles to we build riders," Harley-Davidson CEO Matt Levatich said during last week's earnings call. The company plans to add 2 million riders to the brand over the next 10 years. He said the company finished 2017 with 32,000 additional U.S.-based Harley-Davidson riders than a year earlier.
The company also revamped its Harley-Davidson academies, adding more classes in the U.S., Mexico, Canada, Brazil and China. New and wannabe riders have the chance to learn how to ride a motorcycle on a Harley and receive their motorcycle license in the process. The thinking goes, if consumers learn to ride on a Harley they will develop brand loyalty, Pflughoeft said.
But with motorcycle price tags of $15,000 to $19,000, Harleys are still out of reach for many people.
"Quite frankly, most millennials simply don't have the financial means to buy a $15,000 bike," said Genevieve Schmitt, founder and editor of the women-focused online motorcycle magazine Women Riders Now.
Schmitt said lifestyle habits also make it difficult for younger people to ride Harleys. Young adults may not have access to a garage or a place to park a large bike, she said, or may not have enough vacation time to tour the country on their motorcycle — a major reason why many people ride Harleys.
Since January 2007, Yamaha's market cap has gone from $8.9 billion to $11.5 billion. Suzuki Motors has more than doubled during the period from $12.4 billion to $25.1 billion. Kawasaki Heavy Industries, which also manufactures aerospace and defense equipment, went from $5.8 billion in January 2007 to $6.8 billion.
In January 2007, around the height of Harley-Davidson's success, the company's market cap was just under $18 billion. Eleven years later, the company's market cap has fallen to $8.2 billion. The stock is down more than 15 percent in the past year.
While consumer preferences keep changing as people buy used bikes and seek out new brands, the number of motorcycle registrations has been on the rise throughout the industry. In 1995, there were 3.8 million registered motorcycle riders in the U.S. In 2014, the latest data available, there were 8.4 million, according to the Motorcycle Industry Council.
Harley-Davidson has succeeded in attracting some new riders with bikes like the Sportster —especially among women.
"I couldn't image riding anything else," said Kelly Yun, a 24-year-old from Minneapolis, who bought her first Harley, a 1200 Custom Sportster, a little over a year ago. "I fell in love with the bike the moment I saw it."
The5-foot-1 rider said she tried riding a 250 Honda, but couldn't go long distances on the smaller bike.
"I was kind of embarrassed," Yun said. "It felt like I was riding a scooter." But, she also admitted most Harleys are too big for her. She would be open to riding other bikes by the brand if Harley made smaller motorcycles.
The company sells parts and accessories that allow riders to adjust their seat height and size, as well as foot controls and handlebar location, Pflughoeft said.
Still, Yun is steadfast in her love for Harley-Davidson and doesn't think the classic bikes are at all passe.
"I kind of love the image of an old man on a Harley," she said. "I love that my bike is so loud." She said she wants to add louder pipers to her motorcycle.
"That's the obnoxious part," said Camhi. "When people customize their Harleys to make them even louder."
Like many millennials, Camhi said she might ride a Harley if one fell in her lap, but she would never buy one. "It's just not really my style," she said.