HARLEY-DAVIDSON, Inc. 2008:
THRIVING THROUGH RECESSION
I. CASE ABSTRACT
Founded in 1903, Harley-Davidson is a modern success story of a company that turned itself around by emphasizing quality manufacturing and image marketing. After gaining control of the company from AMF in a leveraged buyout in 1981, management introduced “just-in-time” manufacturing. Encouraged by the high market demand for Harley’s motorcycles in the 1980s and 1990s, competitors increasingly challenged Harley’s dominant position in heavyweight motorcycles. To expand its product offerings, the company acquired the Buell Motorcycle Company, a manufacturer of sport/performance motorcycles, in 1993. Its attempt at diversification outside of motorcycles into recreational vehicles with the purchase of Holliday Rambler was reversed in 1996 with the divestment of this business unit. Worrying that the baby boomer target market for its heavyweight cycles was aging, management decided to introduce the V-Rod in 2001. This was a low-slung, high-powered motorcycle meant to appeal to a youth market that was interested in riding “crotch rockets.”
After consistently growing through the 1990s, sales were showing signs of slowing as the baby boomers continued to age. Safety was becoming an issue, given that riders over age 40 accounted for 40% of all fatalities. For the first time in recent history, sales and profits declined in 2008 from 2007. After President James Ziemer reviewed the 2007 financial results, he noted that 2008 would be a challenging year for Harley-Davidson given the pending recession. Analysts wondered how the company would be affected in a deep recession. How does Harley-Davidson continue to grow at its past rate?
Resources Note:
Please refer to the handout for full documentation of this case. The full write up of the case in PDF file format.
CASE OBJECTIVES
1. To illustrate why Harley concentrated almost solely on its heavyweight motorcycles while introducing the new V-Rod, aimed at younger bikers.
2. To illustrate an American company that has competed most effectively against strong Japanese and German competition.
3. To discuss the issues of slowing down of sales in 2007 and possible continuance in 2008.
• Impact of the aging baby boomers.
4. To discuss the roles of the management team involving everyone in quality and product improvements.
5. To discuss what makes Harley-Davidson customers so loyal.
• To discuss the role Harley-Davidson’s management has played in developing and maintaining this loyalty.
6. To discuss the fact that Harley-Davidson’s management rides Harley’s and they attend Harley club meetings.
• To discuss what information management garners from riding Harley’s and attending club meetings.
7. To discuss the problems of selling motorcycles to women.
• In 2005, women made up 11 percent of the motorcycle purchases compared with 1 percent in 1960.
• Ask the students in your class if they are surprised by the number of female students who have driven and owned motorcycles.
8. To discuss the H.O.G.s and why other companies (auto in particular) have not been able to develop such brand loyalty.
9. To discuss the brand name as applied to Harley-Davidson Café’s ad licensing merchandise.
10. To discuss Harley’s core competencies, and how the Transportation Segment played to these core competencies.
11. To discuss Harley’s distinctive competencies, and how the company develops strategies around them.
BELOW MENTIONED DISCUSSION QUESTIONS SHOULD BE ANSWERED IN THE FORMAT AS DETAILED FROM PAGE 7 ONWARDS:
1. In one page can you summarize and assess this case.
2. What Harley-Davidson strategic position in term of Mission, objectives and strategies
3. Elaborate on Harley-Davidson Corporate Governance.
4. What are the strengths and weaknesses of Harley-Davidson?
5. What are the opportunities and threats facing Harley-Davidson?
6. What are the strategic factors facing Harley-Davidson?
7. Does Harley-Davidson have any core competencies? If yes, what are they?
8. Does Harley-Davidson have a distinctive competency? If yes, what is it?
9. What strategy can Harley-Davidson’s develop to increase sales?
10. What is the impact of competitorson Harley-Davidson’s sales?
• How might the V-Rod and Buell bikes affect future prospects?
11. What is the image of a bike rider?
• Does the biker image help or hinder Harley-Davidson’s image?
12. Why are Harley-Davidson customers fiercely loyal?
13. What is the impact of changing demographics of potential client in Harley-Davidson?
14. Choose and apply three the financial analysis ratio of the company and reflect their meaning to the company.
15. What possible recommendation you can suggest for the company to increase their international sales and what possible challenges they could face.

Table of Content
Introduction 1
1. Topic 1 2
1.1 Sub Topic 1 2
1.2 Sub Topic 2 2
1.2.1 Sub Topic 2.1 3
1.2.2 Sub Topc 2.2 4
1.3 Sub Topic 3 4
1.3.1 Sub Topic 3.1 4
1.4 Sub Topic 4 4
1.4.1 Sub Topic 4.1 5
Conclusion 6
References 7
List of Figures
Figure 1 8
Summarization of the Case Study
Answering Questions from 2 to 14
2. What Harley-Davidson strategic position in term of Mission, objectives and strategies
3. Elaborate on Harley-Davidson Corporate Governance.
4. What are the strengths and weaknesses of Harley-Davidson?
5. What are the opportunities and threats facing Harley-Davidson?
6. What are the strategic factors facing Harley-Davidson?
7. Does Harley-Davidson have any core competencies? If yes, what are they?
8. Does Harley-Davidson have a distinctive competency? If yes, what is it?
9. What strategy can Harley-Davidson’s develop to increase sales?
10. What is the impact of competitorson Harley-Davidson’s sales?
• How might the V-Rod and Buell bikes affect future prospects?
11. What is the image of a bike rider?
• Does the biker image help or hinder Harley-Davidson’s image?
12. Why are Harley-Davidson customers fiercely loyal?
13. What is the impact of changing demographics of potential client in Harley-Davidson?
14. Choose and apply three the financial analysis ratio of the company and reflect their meaning to the company.
Recommendation: Question 15
What possible recommendation you can suggest for the company to increase their international sales and what possible challenges they could face.
References of your Case Study
Citation:
Last page of your assignment must include the complete list of the references used during the completion of your assignment with all the details.
Format for referencing from print media like books:
FAMILY/SURNAME, Initials. (Publication year in brackets) Book title - italicised or underlined. Series title and volume if applicable. Edition – if not the first. Place of publication: publisher.
Example:
NEVILLE, C. (2010) The Complete Guide to Referencing and Avoiding Plagiarism. 2nd Ed. Maidenhead: Open University Press.
Format for referencing from electronic sources:
Author of website FAMILY/SURNAME, Initials or WEBSITE name if no author is available. (Year - in brackets) Title of website in italics or underlined. Any numbers if necessary or available if website is part of a series. [Online in square brackets] Available from: URL. [Accessed: followed by date in square brackets].
Example:
BBC NEWS. (2008) Factory gloom worst since 1980. [Online] Available from: http://news.bbc.co.uk/1/hi/business/7681569.st m. [Accessed: 19th June 2012].
Grading Rubric
Part A Excellent Good Average Needs Improv. Marks Allocated Marks Received
Cover Page
Summarizing Case Study
Question 2
Question 3
Question 4
Question 5
Question 6
Question 7
Question 8
Question 9
Question 10
Question 11
Question 12
Question 13
Question 14
Recommendation
Referencing
Report Format
Late Penalty
Final Total