•Type Public-1984, NYSE-1987

•Founded 1903

•Founder William S. Harley

Arthur Davidson

Walter Davidson

William A. Davidson

•Headquarters Milwaukee, Wisconsin, USA

•Key People James L. Ziemer (CEO)

Thomas E. Bergmann (CFO)

James A. McCaslin (COO)

Syed Naqvi (President, HDFS)

•Industry Recreational Vehicles

•Revenue ▲ 8.8 Billion USD (2008)

•Employees 9,700 (2006)

•Subsidiary Buell, HDFS

•Websitewww.harley-davidson.com

VALUESThese are our values. They are the heart of how we run our business. They guide our actions and serve as the framework for the decisions and contributions our employees make at every level of the Company.Tell the Truth.Be Fair.Keep Your Promises.Respect the Individual.Encourage Intellectual Curiosity.

VISIONHarley-Davidson, Inc. is a global leader in fulfilling dreams and providing extraordinary customer experiences through mutually beneficial relationships with our stakeholders. 

MISSIONWe inspire and fulfill dreams around the world through Harley-Davidson motorcycling experiences.

GENDER 2007 2006 2005 2004 2003

Male 88% 88% 88% 89% 89%

Female 12% 12% 12% 11% 11%

MEDIAN AGE MEDIAN INCOME

DEMOGRAPHICS

2007 HDMC INDUSTRY

Median age 44.4 yrs. 32.6 yrs.

Median Household Income $80,700 $42,500

Male 95% 90%

Married 57% 49%

Occupation

Blue Collar 53% 55%

White Collar 40% 31%

Education

High School Graduate 90% 75%

College/Degree 44% 38%

52% Owned Harley-Davidson® motorcycle previously at any point during lifetime

33% Owned a competitive motorcycle previously

15% First motorcycle purchased

COMPETITION !!!! BMW, Germany 02.3% Daelim, S. Korea 02.6% Ducati, Italia 00.9% Honda, Japan 21.7% Kawasaki, USA 13.6% Polaris, Britain 01.5% Suzuki, Japan 12.6% Yamaha, Japan 10.0% HDMC, USA 34.8%

Strategic Direction and Marketing Objectives 

•HD has chosen the strategic direction of targeting a younger market that is technologically conscious in order to increase its share in the performance cruiser market space.

•To target the younger market with the new product line, the company has adopted the following marketing objectives: to expand its current market (market expansion), diversify its product line (product diversification), and modify its marketing mix to target a younger demographic.

•During the 1970's, HD was facing a decline in market share due to increased competition with Japanese companies. By phasing out weak models, becoming more selective, and limiting sales and promotions, HD was able to carve out a niche in the marketplace which it enjoys today

Possible future strategies to increase market share:

•First, HD needs to expand its potential customer base to include enthusiasts and non-enthusiasts males in the 35-44 age group

•, HD needs to position the V-Rod to also appeal to first time buyers of motorcycles. HD's strong brand identity can help pull in new clients.

•Third, HD has to set an appropriate marketing mix that will help attract a younger consumer base. By using the low-end approach, which involves attracting a young audience to a brand name product with a low price tag (similar to what Jaguar and BMW have done), HD can expand its popularity to the domestic and international market. 

Marketing Mix Elements

•The product strategy is any decision that helps the company continue to develop new products around its signature American image and positions the company in the market as such. The main reason for the introduction of the V-Rod was the need to create a bike that would appeal to a younger demographic and attain a greater market share for the company. By using the low-end targeting method (as discussed previously) with the introduction of the V-Rod, this can be considered HD's first step toward implementing its strategic and marketing objectives.   

Product LineMotorcycles

Accessories Men'

s Womens Kids Gifts

Items

>$6,999

>$11,999 >$15,899

>$14,999

As for the pricing strategy, HD must be careful to implement a pricing decision based on the low-end targeting method. Priced at $17,000 MSRP, HD's V-Rod has the second highest price tag in the performance cruiser market. Although HD does have a 22% share of the total market, HD's pricing strategy has three main factors that have influenced how it has priced the V-Rod: 1) the used motorcycle market, 2) lower priced motorcycles, and 3) HD's inability to keep up with demand4. In order for HD to attain a greater market share, the company must examine how these three factors will continually play a role in pricing and adjust accordingly.   

PRICE

Model US $ Indian Rs (approx)

Sportster® $6,999 5,97,000/-

Dyna® $11,999 10,23,000/-

Softtail® $15,899 13,55,000/-

VRSC® $14,999 12,80,000/-

Touring® $16,999 14,50,000/-

•Prices have been arrived at by calculating the various surcharges and import duty amounting to 103% of original rate (www.thekneeslider.com)•Exchange rate – US $ (in Rs.) 42.79/- as on 30/07/2008•Price in US $ courtesy –www.harley-davidson.com

HARLEY DAVIDSON ON INDIAN ROADS

THE INDIAN CONNECTION Meeting with Mr. Kamal Nath (Minister of Commerce and

Industry) on April 2007

13th April 07 relaxation of emission norms

Quid-pro-Quo with American government

Initial sales target 500 units for 3 years

The Harley-Davidson Corporation has found multiple ways to implement its promotion strategy. HD's primary promotional tool since 1983 has been the HOG. The company's advertisements and commercials are focused around female images. Since 93% of bikers are males, the HOG advertising campaign has been successful for decades5. HD also uses another strong promotional campaign through its cafes, located in most dealerships. HD has also developed an interactive website (www.harley-davidson.com). The website gives the company the chance to expand its operations online. Finally, HD's most important promotional tool is the brand image of a truly American product. Such a tool appeals to the domestic market, and owning a Harley-Davidson bike fits well into supporting the national feelings of pride for America. 

PROMOTION

Although the company generated more than $1.3 billion in revenues in 1995, it spent less than $2 million in advertising. "We're not dependent on advertising or other traditional marketing techniques as automobile companies or even our competitors are," says Schmidt. "They're selling transportation. We're selling dreams and lifestyle. There's a big difference."

EMPLOYEE INVOLVEMENT IN MANAGEMENT

BCG MATRIX

• RELATIVE MARKET SHARE: 48%• GROWTH RATE: 13.029

STRATEGY: MARKET PENETRATION, MARKET DEVELOPMENT, PRODUCT DEVELOPMENT, DIVESTITURE.

S W O T ANALYSIS

Strengths

•American company•Huge fan following •Range of good products

Weakness

•Bad boy image•High cost•Poor emission records

Opportunity

•Large untapped market•Booming tourism sector•Movement of customers towards high end products

Threats

•Competitors•Restrictive government policies•Time

1992 1993 1994Liquidity ratio current ratio (times) 1.57 1.75 1.88 Quick ratio (times) 0.81 0.86 0.94

Leverage ratio Debt ratio (%) 44.30% 68.93% 41.39% Interest coverage (times) -19.79 -84.00 3643.34

Profitability ratio Net Profit Margin (%) 4.87% -0.98% 6.76% Return on asset (%) 10.30% -2.04% 14.11% Return on equity (%) 16.04% -3.66% 24.07%

Activity ratio Account receivable (times) 11.86 14.15 10.75 Average collection period (days) 30.77 25.79 33.95 Inventory turnover (times) 8.57 6.28 6.46 Average sale period (days) 42.61 58.11 56.50 Fixed asset turnover (times) 4.31 4.88 4.62 Total asset turnover (times) 2.12 2.09 2.09

Ratios Analysis

Historical Ratio Analysis

1994 1995F 1996F 1997F 1998F 1999FNet sales (w/o recommendation) 1,541,796 1,805,023 2,160,800 2,434,060 2,702,121 3,004,958 Net sales (with recommendation) 1,541,796 1,805,023 2,143,024 2,014,925 2,368,204 2,787,186 Net sales (with pricing effect) 1,541,796 1,805,023 2,357,326 2,216,418 2,605,025 3,065,905 Net income (loss) (w/o recommendation) 104,272 119,463 143,009 161,094 178,835 198,878Net income (loss) (with recommendation) 104,272 119,463 164,334 171,638 220,677 268,081Net income (loss) (with pricing effect) 104,272 119,463 378,637 373,131 457,498 546,800

Net Sales and Net Income

Harley-Davidson announces leadership change at Financial Services unitMILWAUKEE (January 8, 2009) - Harley-Davidson, Inc. (NYSE:HOG) announced today that its Chief Financial Officer, Tom Bergmann, will take on the added responsibility of interim President of Harley-Davidson Financial Services (HDFS), effective immediately.The appointment follows HDFS President Sy Naqvi’s personal decision to resign. Naqvi joined HDFS as President in February 2007. Bergmann will serve as interim HDFS President while the Company conducts a comprehensive external search.“In the current economic environment, HDFS is an especially important priority for us and Tom has been highly involved in guiding that business,” said Jim Ziemer, Chief Executive Officer of Harley-Davidson, Inc. “I am confident Tom is the right person to lead HDFS through this transition.”  Before joining Harley-Davidson as CFO in 2006, Bergmann was the CEO of USF Corporation, a $2.5 billion publicly traded transportation and logistics company. Bergmann also served as Corporate Controller and Vice President of Finance for Financial Services at Sears, Roebuck and Co., and in senior level positions at The St. Paul Companies, Inc. and Johnson & Johnson, among other executive positions he has held.“HDFS has a strong leadership team and I am looking forward to working with them even more closely,” said Bergmann. “We wish Sy well in his future endeavors,” he said.Harley-Davidson, Inc. is the parent company for the group of companies doing business as Harley-Davidson Motor Company (HDMC), Buell Motorcycle Company (Buell), MV Agusta and Harley-Davidson Financial Services (HDFS). Harley-Davidson Motor Company produces heavyweight custom, touring and cruiser motorcycles. Buell produces premium sport performance motorcycles. MV Agusta produces premium, high-performance sport motorcycles sold under the MV Agusta® brand and lightweight sport motorcycles sold under the Cagiva® brand. HDFS provides wholesale and retail financing and insurance programs primarily to Harley-Davidson and Buell dealers and customers.

Harley-Davidson creates special program to help riders share their passionMILWAUKEE (January 13, 2009) - The Merriam-Webster dictionary defines mentor as a “trusted counselor or guide.”  Mentors can come from various backgrounds and ages, but all share a common goal of sharing their passion with others.  So as the nation celebrates National Mentoring Month, Harley-Davidson is encouraging riders to share their passion for the open road with others through a special mentoring program called Share Your Spark.Share Your Spark: A Guide to Mentoring is a tool kit the Motor Company developed for current and aspiring riders featuring information on how to be a resource and support system to others during their motorcycling journey. The mentoring kit includes information for both potential mentors and mentees, including a DVD showcasing tips on how to become or find a mentor, stories from successful mentoring experiences, a special Share Your Spark pin and a planning and reflection guide."The mentoring experiences is empowering for both parties involved," said Leslie Prevish, market outreach manager, Harley-Davidson. "For the mentor, they get to share their passion with someone who aspires to live the same dream they do.  For the mentee, they learn through the collective experiences of their guide. Of course, the mentoring relationship also leads to many life-lasting friendships.”  Prevish adds that Share Your Spark is not just for women, but the Motor Company’s research indicates many women have expressed their desire to be – and find – a good riding mentor.

Over the past several years, women have increasingly embraced the sport of motorcycling – seeking the freedom and adventure associated with the open road, polished chrome and a sweet sounding engine. In fact, the number of women who have purchased new Harley-Davidson motorcycles has tripled over the past 20 years, with women now accounting for nearly 12 percent of new Harley-Davidson motorcycle purchases.What Else Harley’s Doing to Inspire Women to RideHarley-Davidson’s We Ride is a comprehensive and inspirational overview on what a new rider or a woman interested in riding needs to know about getting into the sport. It features information on how and where women can learn to ride with details on the Rider’s Edge® New Rider Course, as well as the best way to fit a motorcycle for a woman’s ergonomic and functional needs. It also includes tips on getting involved and staying active with riding groups, including inspirational stories from real women who have answered the call of the open road. For more information, visit www.harley-davidson.com/womenriders.Harley-Davidson dealerships across the country are also hosting women-only Garage Parties to encourage them to get involved in motorcycling. The Harley-Davidson Garage Party event provides a non-intimidating environment for women to learn more about motorcycling and meet others who are interested in riding.For more information about Share Your Spark, visit your local Harley-Davidson dealership or visit www.harley-davidson.com/womenriders. 

Harley-Davidson Motor Company, the only major U.S.- based motorcycle manufacturer, produces heavyweight motorcycles and a complete line of motorcycle parts, accessories and general merchandise. For more information, visit Harley-Davidson's Web site at www.harley-davidson.com.

THE END