Indian’s New Private Equity Owners Want To Run The Harley-Davidson Playbook

Private equity firm Carolwood Capital bought Indian out from under Polaris last month. Private equity deals almost invariably kill the companies involved, but Carolwood really wants to tell you it truly has Indian’s best interests at heart — at least, that’s what Spencer Towill, head of mergers and acquisitions at Carolwood and architect of the Indian deal, went on Bloomberg to say after the buyout. But even if Carolwood does want to run Indian profitably in the long term, some of what Towill said on the call is concerning for the company’s future. 

RideApart wrote up Towill’s appearance on Bloomberg, with a particular focus towards his comments about Indian taking a Harley-Davidson style dive into merchandising. That’s definitely concerning, but it’s also not a huge issue — plenty of manufacturers sell branded gear, either on their own or in collaboration with noted moto gearmakers, and we never rag on Honda for releasing Africa Twin-branded Alpinestars jackets. No, the worse issue with Carolwood’s take is how else it plans to ape Harley. 

In conversation with Bloomberg, Towill said:

Bringing in Mike Kennedy, who’s going to be the new CEO of Indian, was a critical part of this deal for us. Mike is a titan of the motorcycle industry in our opinion, and again we’re humble enough to understand that we are not experts in the motorcycle space, and so having him as part of our team makes us incredibly excited. He’s been in the motorcycle business for 30 years, he was at Harley Davidson 26 of those 30 years. He certainly knows their playbook well, and so we’re extremely excited to have him as our new leader.

Mike Kennedy joined Harley-Davidson in 1998 and left the brand in 2017, interrupted only by a two-year stint at BRP. That means he worked there through the heyday of the early-aughts cruiser craze, the heights of “American Chopper” enthusiasm, and saw both the beginning and the end of the Dyna. He witnessed the failure of the XR1200, and the cafe craze that it never got to take a bite out of. There’s a lot to learn from there. 

But Harley’s playbook, especially in recent years, has largely been more about enriching shareholders than actually selling bikes. It lost the one CEO that intended to broaden the brand and it won’t sell its most entry-level bike, but the company is still buying back shares — these aren’t good financial moves for anyone but the owners. If that’s the playbook that Carolwood wants Kennedy to run, it’s one that’ll be great for the private equity firm but terrible for the actual motorcycle brand. If I had to guess which one Carolwood cares more about, it wouldn’t be hard to pick.