Harley Davidson has long been an American Icon.

Topics: Strategic management, Motorcycle, Marketing Pages: 7 (2057 words) Published: June 22, 2003


Harley-Davidson Background

Harley-Davidson was founded in 1903 by Arthur and Walter Harley and William Davidson. During its first years of existence the company experienced an enormous amount of growth. Harley-Davidson gained its popularity two ways. The reputation of the firm was linked to Davidson riding Harley's motorcycle to victory in a 1908 race. The second reason, even more important, was by providing innovations to marketed products such as the V-twin engine, clutch, internal expanding rear brake, and the three-speed transmission. By 1918 Harley-Davidson became the world's largest motorcycle company by producing 28,000 motorcycles annually.

In the early 1940s (during WWII) Harley-Davidson had another chance to increase production. The company's motorcycles were used by the military as dispatch and scout bikes. In 1943 the firm noticed growth of production to 29,000 units. This promising trend was one of the reasons behind the firm's decision to open a plant in Wauwatosa, Wisconsin. After War World II, for the first time in their history, Harley-Davidson faced competition pressures from Europe. American GIs stationed in the United Kingdom had developed a taste for smaller and more efficient British motorcycles such as the Norton and the Triumph. Despite weak demand and European competition Harley-Davidson stayed the undisputed leader in the American market with over 60% of the market share and $20 million in sales.

Harley-Davidson - Charm

From the beginning, since the company first came into existence up until 1950s, Harley-Davidson had created an image of "raw power". There was a lot of aspects which set Harley-Davidson apart and created the mystique of the bikes. Let's just recognize a couple of them such as: the heavy use of chrome, the low- profile appearance, the style tail fenders and the extension of fork beyond plumb.

Someone who loves motorcycles is able to understand what it means when a Harley-Davidson engine sounds like "bassoprofundo thumb", while at the same time other motorcycles sound like "sewing machines" - the Harley's engine was and still is a masterpiece, a company's reason to be proud.

The U.S. military, highway patrol officers, the Hell's Angels, and Hollywood rebels all using the bikes helped to cultivate an image of Harley motorcycles as "tough". As a continuation of what was just said, the motorcycle was often associated with a kind of person living to break traditional mold or living on the edge. After all these years on the market Harley-Davidson deserved to become a part of American iconography (associated now with the American flag). An association with the American symbols has resulted with amazing brand loyalty.

The last but not the least reason why Harley's motorcycles became so popular and unique was that bikes were mostly handcrafted and this is something that helps to distinguish them from Japanese competitors. Even now some parts of the Harley-Davidson's bikes have been made in this way and. What is very important for riders, customers are able to buy selected parts in stores - it gives them chance to "work on their own Harley" at home.

Towards the end of the 1960's and the beginning of the 1970's Harley-Davidson was facing stiff competition from the Japanese. The company needed to raise capital to compete more effectively and for this reason decided to go public. When this did not produce the desired result. The company allowed themselves to be purchased in a friendly takeover by AMF. Although the case does not mention how much effort went into making the decision whether or not to be acquired by another firm. It seems that with the undesirable consequences that followed, Harley-Davidson should have tried other means of raising their much needed capital. The company could have tried to cut cost in their production, marketing and other operational areas first. Following a cost cutting strategy could have been a sure way to...
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