1. Financial Challenges and Apparel Sale

LiveWire, Harley-Davidson's electric brand, reported a net loss of $40.7 million in Q2 2023, which is expected considering it is a newly established company that hasn't fully scaled up its operations yet. Notably, LiveWire apparel sales alone exceeded $66 million, showing the brand's potential in other areas.

2. Decline in Sales Volume 

During Q2 2023, LiveWire sold only 33 LiveWire One units, compared to 225 units in the same period the previous year. This substantial decline raises concerns about the brand's market performance and customer demand for their products.

3. Financial Backing and Forecast

Despite the losses, LiveWire has access to $260 million in cash and cash equivalents and an additional potential investment of $200 million from a nonbinding term sheet with Harley-Davidson. This financial backing aims to support the brand through its current stage of development.

4. Third Quarter as a Turning Point

The upcoming third quarter is crucial for LiveWire as it will provide insight into the brand's future trajectory. Several key developments are expected to shape its performance during this period. Expansion into the European market at the end of June 2023 opens new sales opportunities for LiveWire.

5. S2 Del Mar Production and Impact on Sale

The launch of the S2 Del Mar, a new LiveWire model, was delayed but has now commenced production, with initial units rolling off the assembly line. The delay might have contributed to the declining sales figures for the LiveWire One model, as some customers may have been waiting for the more affordable Del Mar model.

6. Ongoing Model Development

LiveWire is actively working on its third model, following the Del Mar, which will be the second to utilize the S2 platform. Continuous model development indicates the brand's commitment to expanding its product lineup and diversifying its offerings.

7. Revised Sales Forecast

LiveWire has revised its sales outlook for the year, now projecting sales of 600 to 1,000 units. This is a downward adjustment from the previous estimate of 750 to 2,000 units, reflecting the brand's cautious expectations for its sales performance in the current market environment.

8. Importance of Del Mar's Performance

The success of the Del Mar model is crucial to LiveWire's overall sales performance. A strong response to the Del Mar in the market is essential for the brand to reach its revised sales target for the year.

9. European Market Potential

The expansion into the European market offers LiveWire an opportunity to tap into a new customer base. The third quarter results will shed light on the reception of LiveWire products in Europe and its potential impact on the brand's overall performance.

10. Need for Positive Response

To steer the LiveWire brand towards profitability and success, a positive response from customers in Europe and a successful launch of the Del Mar model are essential. These factors will play a critical role in determining the brand's future growth and sustainability in the highly competitive electric vehicle market.