Roaring out of retirement, motorcycle company CEO builds a brand
The war in Iraq reminds Indian Motorcycle Corp. president and CEO Louis Terhar of the two defining moments in his life — a tour of duty as a young officer during the Vietnam War and the birth of his first child.
An engineering graduate of the U.S. Naval Academy, Terhar says he learned how to prioritize things at a young age.
“Right out of the academy, I went to Vietnam for a year,” he says. “I found out very quickly there are some things that are important and there are some things that are critical. Something’s critical if somebody’s going to die — everything else in life is important.”
Three decades later, with a wife and four children, Terhar was enjoying an early retirement and teaching graduate school at Xavier University in Cincinnati after a successful corporate career.
He had no idea fate was conspiring to lure him from retirement to head a struggling, privately-held, motorcycle company.
While he was teaching at Xavier in 2001, venture capital investor The Audax Group of Boston gained control of Gilroy-based Indian Motorcycle with a $45 million stock buyout. Shortly afterward, Terhar got a telephone call from Audax, which learned about him from a corporate headhunter, asking him if he’d leave retirement, move to Gilroy and take the helm of a motorcycle company struggling to turn a profit.
“Lou is a real leader of people,” says Steven Kaplan, managing director of Audax Group. “While in the Navy, he commanded a seal support team.”
But that battle-hardened demeanor has softened around the edges during the years. Terhar’s typical Midwestern politeness takes a reflective and more personal turn when discussing his military career.
“One of the things you learn in the service is to be a team player,” he says. “It carries over into everything you do.”
Terhar says watching news about the U.S. invasion of Iraq on television stirs up decades-old memories.
“The thing I think about much more when I see stuff on CNN is not where the troops are on the map,” he says. ” I think about the young officers and the kids — and they are kids — who are out there going through a life-changing experience. You just hope they come through OK, and they get out.”
During his naval career, Terhar’s first child, a daughter and the only girl out of his eventual four children, was born.
“Before my daughter was born I had no thought of leaving the Navy,” he says, leaning forward, becoming more engaged in the conversation as he talks about his family. “After we had a new baby in the house, that completely changed my outlook on what I wanted to do with my life. I decided going into business where I could be home to see my kids grow up was more important to me than a military career.”
“When you have that first child, you look at that little baby sitting there and you realize that’s your responsibility,” he says. “Life takes on a whole new meaning for you.”
After he left the military, Terhar earned graduate degrees from Syracuse University and Harvard and entered business, Terhar eventually worked for industrial conglomerate W.R. Grace & Co., as director of European operations for tool maker Black & Decker and as president and CEO of scrap steel giant David J. Joseph Co. of Cincinnati before retiring in his early 50s.
Terhar, the oldest of nine children raised on a carpenter’s income, says his modest upbringing inspired him to reach out to disadvantaged children through various philanthropic and charity efforts.
“I didn’t even know I was poor until I went to high school,” he says.
It was Terhar’s history of succeeding despite the odds that got Audax’s attention, thinking him a perfect fit for Indian.
“Lou is someone who can get his hands dirty and dive into the details operationally,” says Kaplan. “We were very much looking for someone who could drive all of the operational and engineering issues at Indian to world-class levels.”
Kaplan says Terhar’s experience allows him to set realistic goals, drive quality and understand engineering minutia that could bog down a leader without an engineering degree.
Still, getting the Cincinnati native to leave his beloved hometown was no easy task.
“When this came up, I wasn’t very interested in going to California,” Terhar says. “But my wife, who knows me better than I know myself, … told me I was a little more bored teaching than I realized.”
So Terhar went to Boston to visit Audax and was convinced to fly to Northern California to visit Indian where he quickly rediscovered his passion for riding motorcycles.
“I came here and I really fell in love with bikes again,” Terhar says. “I rode when I was young and suddenly it was like a rebirth of youth. The machinery is gorgeous. If you’re an engineer and you don’t love a bike, there is really something wrong with you.”
But was pursuit of that reborn love worth leaving Cincinnati?
“I still had two boys in high school,” Terhar says. “They had been going to the same school since they were children and my wife also teaches there.”
But, after talking to his family, Terhar decided he could have both worlds — he would take the job, but his family would stay in Cincinnati.
During the weekdays, he lives in Pacific Grove and commutes the 42 miles to Gilroy. On weekends, Terhar usually is racking up airline frequent-flyer points by jetting 2,500 miles back and forth to be with his family in Ohio.
“My wife said, ‘This is something you gotta do, and if you have to commute for a while, that’s fine,’” Terhar says.
He says the tradeoff is worth it for now.
“I look at this place and I think it’s such a strong brand,” he says. “This is a billion-dollar name. The company just has to grow into that name.”
Terhar does have experience growing billion-dollar companies. He took David J. Joseph Co. from sales of $300 million to $1.1 billion when he was there.
But talking to him on a Thursday afternoon, you can tell Terhar is looking forward to being back in Cincinnati with his family.
Although he rolls his eyes at being called a “family man,” Terhar is obviously a devoted, if long-distance, father and husband.
“The difference between being married and being married with children to me is a big transition,” he says. “I know a lot of people who are married who don’t have children and I think to myself, they really don’t get it.”
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