Battered by the economic recession and reporting a dramatic fall in sales and profits this week, legendary American motorcycle manufacturer Harley-Davidson has outlined plans to offload its Italian MV Agusta division, which it only bought only a year ago, as soon as it can find a buyer.

According to its third quarter financial figures released late this week, worldwide retail sales of new Harley-Davidson motorcycles declined 21.3 percent in the third quarter compared to last year’s third quarter, but a mild improvement from the 30.1 percent decline in this year’s second quarter.  An 84.1 percent decline in net income and an 84.5 percent decline in diluted earnings per share from the year-ago quarter reflected lower motorcycle shipments and the effects of the economy on retail and wholesale loan performance at Harley-Davidson Financial Services.

Harley-Davidson also unveiled major elements of its new go-forward business strategy to drive growth through a single-minded focus of efforts and resources on the unique strengths of the Harley-Davidson brand, and to enhance productivity and profitability through continuous improvement. As approved midweek by Harley-Davidson’s Board of Directors, the company will divest its MV Agusta unit as part of this strategy. Harley-Davidson only completed the purchase of Varese-based MV Agusta on August 8, 2008, buying the indebted and loss-making firm for US$109 million from a private equity house that had inherited the it from its previous owners, Malaysian carmaker Proton.

“While the environment remains challenging for us, we are mildly encouraged by the moderation in the decline of dealer retail Harley-Davidson motorcycle sales,” said Keith Wandell, Chief Executive Officer of Harley-Davidson, Inc said on Thursday. “And moving forward, our strategy is designed to strengthen Harley-Davidson for long-term growth and deliver results through increased focus. As our announcement regarding Buell [another of its divisions, but one that it plans to close down] and MV Agusta indicates, we are moving with the speed and decisiveness required to bring our business strategy to life,” said Wandell.  “The fact is we must focus both our effort and our investment on the Harley-Davidson brand, as we believe this provides an optimal path to sustained, meaningful, long-term growth.”

According to the third quarter statement Harley-Davidson "will immediately commence efforts to sell the [MV Agusta] business." In the third quarter the American bike maker also made "a goodwill impairment charge of US$18.9 million related to MV Agusta."

“Buell and MV Agusta are great companies, with proud brands, high-quality exciting products and passionate enthusiasm for the motorcycle business. Buell has introduced many innovative advancements in motorcycle design and technology over the years and MV Agusta is known in Europe for its premium, high-performance sport motorcycles. However, our strategy to focus on the Harley-Davidson brand reflects the fact that we believe our investments in that brand are a better utilisation of overall company resources,” said Wandell.