By José Rodríguez Jr.
& By Peter Kaye
Harley-Davidson insisted on spinning off the LiveWire brand earlier this year (2022). The U.S. bike maker was eager to establish a separate identity for its upcoming electric motorcycles, but it was also eager to secure funding for its new EV brand, doing so through a special purpose acquisition company (SPAC) in lieu of an initial public offering (IPO). That plan has become costlier than Harley could’ve hoped for, now that LiveWire’s funds are being funneled out of the company by investors to the tune of $370 million, according to Ride Apart.
Since LiveWire went public by merging with AEA-Bridges Impact Corp. on September 27, the initial investors who propped up the EV maker with a $400 million investment, per Ride Apart, have withdrawn $370 million and left the company with just a tiny fraction of its startup funds. It’s a big loss, which comes on the heels of LiveWire falling short of projections by $251 million: it was expected to get an influx of $545 million but got $294.
Harley-Davidson pitched in $100 million when LiveWire went public, but now that investors are pulling out their funds, Harley had to make up for the loss by pumping another $100 million into LiveWire. Ride Apart notes that a money-in-money-out pattern is not unusual for SPACs. So it wasn’t all that unexpected, but these kinds of fundraising mergers are becoming more and more risky.
Whether Harley wanted to or not, it now owns 90 percent of LiveWire shares, which is up from 74 percent when the EV maker spun off and went public. That’s either good or bad depending on your opinion of H-D as a parent company. Remember Buell? We remember Buell. Well, the LiveWire S2 Del Mar is almost as cool as any Buell.
Of course, things are a little different this time around, since the storied motor company from Milwaukee is under new leadership, and the industry overall is undergoing a sea change from ICE to EVs. Harley CEO Jochen Zeitz seems to be all in on the future of both mobility and the workplace, which only makes the split between Harley and LiveWire that much weirder. Sure, I get the need for LiveWire to distinguish itself as its own badge, but as a whole other brand?
Harley-Davidson could’ve stayed the course and forced the future down the intake of its old motorcycles. Maybe even more than cars, motorcycles are great candidates for electrification. Lower battery weight, lower mass, lower range. All of these are apparently nonstarters for electric cars, but bikes don’t have these hang-ups. Harley shouldn’t have them either. Harley has a built-in audience, and I bet LiveWire does, too. Some are just waiting for lower prices. Some on the other hand are not fans of any type of electric vehicle due to the cost of manufacturing lithium batteries, the energy it requires to charge an electric vehicle or motorcycle and the low range distance they provide. If you are a rider, that likes an overnighter and enjoys riding between 200-400 miles in one day, you can forget that with an electric motorcycle!