xxviii) Harley-Davidson

Introduction

Harley-Davidson started in 1903 and over the years has had many ups and downs, eg

- it supplied the US Army in World War II (up)

- its cheap war surplus encouraged the bikie culture after the war (up)

- in the 1960s when the Japanese dominated the world's motorcycle markets, Harley-Davidson suffered (down)

- starting  in the 1980s it benefitted from a 50% sales protection in the US (up)

"... Sales increased by more than fivefold between 1986 and 2000, during the time the demographic seemed to shift from bearded outlaws to partners of the Big 4 accounting firms......in 2006 it had a record revenue of $US 58.8 billion, built 350,000 motorcycles and was valued at more than $US 15 billion......this year it is likely to build around 215,000 units and its market capitalisation is $US 5.43 billion..."

Tony Davis 2019

- trade war between USA and Europe (starting in 2018), ie European tariffs (eg 25% on American motorcycles) introduced in retaliation for Trump's steel and aluminium tariffs against Europe (down)

- fewer motorcycle riders as large number of older riders exit the industry, ie

"...there are 3 million Harley-Davidson riders in USA today, but about 1 million of them will drop out of motor-cycling in the next 10 years..."

Matt Levatich as quoted by Tony Davis 2019

Future plans

Aims

- change in focus from building motorcycles to building riders, including young people, women and ethnic minorities of all ages with smaller, more practical, modern-looking bikes. They see motorcycling more as a means of transportation than a hobby. It's about riding rather than the bike.

"...by 2027, to have entrants in almost every niche, and to sell more than half its output outside America (today it sells around 42% offshore)..."

Tony Davis 2019

- to maintain a healthy margin, around the mid-30% range.

- it is widening its range of motorbikes that are very different from the traditional bike, ie

"...small motorcycles with battery power, off-road capable adventure motorcycles, European-style sports bike......e-bicycles, all wearing the brand and logo normally associated with huge, powerful, chrome-laden retro machines..."

Tony Davis 2019

 

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