Harley-Davidson CEO Barely Survives Overthrow Attempt
2nd biggest shareholder fought to oust CEO Jochen Zeitz and 2 board members.
Jochen Zeitz at the 2024 opening of Davidson Park. Photo by Jeramey Jannene.
The barbarians at the gates were kept at bay, at least for now. But they might have won the war.
During its annual meeting Wednesday, Harley-Davidson announced that CEO and Chairman Jochen Zeitz and two board members were reelected. But, according to a source with knowledge of the results, they won by slim margins and with promises that all three will step down next year, that a new CEO will come from the outside and that the chairman and CEO roles will be divided.
“This is no way a definitive victory for Harley-Davidson,” said the source. “We lost the battle” but “we won the war.”
The company’s second-largest shareholder, H Partners, had sought to oust Zeitz and two other board members over concerns with the company’s performance. The boardroom battle became public in early April.
Harley-Davidson publicly announced that Zeitz intended to step down later this year, then H Partners principal and Harley-Davidson board member Jared Dourdeville resigned, issuing a public letter that launched a “withhold” campaign seeking to shake up the board and immediately fire Zeitz. Dourdeville had already privately called for Zeitz to step down as part of an effort to influence who the next CEO will be.
What ensued was a very public battle of press releases, and a quiet courting of the company’s largest shareholders.
According to a source with knowledge of the situation, Zeitz only survived by a “razor-thin” margin, with 48% of shareholders voting to withhold. If Zeitz did not secure 50% of the vote, he would have been removed. Long-time board members Tom Linebarger and Sara Levinson also survived H Partners’ challenge, but with 44% of shareholders voting to withhold. The other board nominees had a withhold rate of only 2%. Harley-Davidson did not immediately release the vote totals.
In the lead up to the annual meeting, H Partners accused the board of making private commitments to certain shareholders that Zeitz, Linebarger and Levinson would leave the board in 2026 and an external candidate would be hired. Zeitz, 61, has served on Harley-Davidson’s board since 2007 and became CEO in February 2020.
“We maintain that this is exactly the type of arrogant, insular thinking that has led to brand erosion, dealer frustration and sustained sales declines at Harley-Davidson,” said H Partners in a statement.
Harley-Davidson accused H Partners of running a “misleading and disruptive campaign.” Harley-Davidson previously said Dourdeville was not a dissenting voice on the board.
The New York hedge fund said it wanted the next CEO to restore the relationship with dealers, restore the corporate culture and brand, engage with riders and reactivate the company’s headquarters.
H Partners, in a public filing, said it believed Zeitz and the board were trying to promote CFO Jonathan Root to the CEO role. H Partners had sought a different, undisclosed candidate that the board deadlocked on.
In April, H Partners specifically attacked Harley-Davidson’s stock performance. It said the company’s stock underperformed the S&P 500 by 104% since Zeitz became CEO.
“While I am concerned about this severe underperformance, what I am most concerned about are the foundational building blocks that underpin any company’s long-term trajectory: culture, transparency and accountability, and the willingness of the Board and management to put the Company first,” said Dourdeville in his April 5 resignation letter. The H Street principal was added to the board in 2022 as part of a cooperation agreement after H Partners targeted the company’s executive and board compensation and corporate governance, demanding changes.
Zeitz led the company during the onset of the COVID-19 pandemic and established a white-collar remote work policy that effectively emptied the company’s historic headquarters on Milwaukee’s Near West Side.
In his resignation letter, which was heavily-redacted, Dourdeville said he wasn’t aware of the “extent of this white-collar-work-from-home policy,” the result of which has left the company’s historic headquarters mostly vacant and much of the employee parking lot turned into the $20 million Davidson Park. In his letter, he took issue with the “lack of accountability and transparency,” declining sales and the perceived failure of Zeitz’s Hardwire strategy. “At its highest levels, Harley-Davidson lacks a winning culture.”
Zeitz was paid $9.14 million in 2024 and $12 million in 2023; both years included a $1.95 million base salary and substantial stock-based compensation. His 2023 compensation was 157 times that of the average worker at Harley. Zeitz was paid $43.3 million in 2022, a state-leading figure that was attributed to a $32 million stock bonus that requires the company to hit target figures in future years.
The company reported earnings of $278 million in 2024, a 6% increase, on the sale of 148,862 motorcycles, a 17% decrease. LiveWire, its electric motorcycle spinoff, reported a loss of $93.9 million in 2024, down from $109.6 million in 2023. It expects to sell 1,000 to 1,500 electric motorcycles in 2025.
In addition to reflecting Harley-Davidson’s preferred board slate, shareholders voted to add Valvoline president and CEO Lori Flees to Dourdeville’s former seat. The board has nine members.
Prior to leading Harley-Davidson, Zeitz was the chairman and CEO of the German-based athletic brand Puma for 18 years. He instituted a “Hardwire” plan that attempted to reposition the motorcycle company as a premium brand. Zeitz lives in New Mexico and splits his time between the state and the Harley-Davidson office in Wauwatosa.
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