The Harley-Davidson Motor Company was formed in 1903 by William S. Harley and the Davidson brothers (Walter and Arthur). The company started out slowly but once word got round that the Harley-Davidson was a reliable piece of machinery, more orders flowed in. Early on Harleys were exported to other countries. During World War I (1917-1918), Harley-Davidson produced 20,000 military motorcycles to serve the U.S. Allied forces. Again during World War II (1941-1945), Harley-Davidson produced more than 90,000 motorcycles for the Allied forces. The company had always been family owned but in 1965, with company profits down and a shortage of money, the decision was made to go public. The family run company was careful to keep control, having 7 of the 9 board members being family. This influx of cash was used for new equipment and advertising but within a few years they were back to being in financial difficulties. With shareholder approval, in 1969 Harley-Davidson became a subsidiary of AMF (American Machine and Foundry Company). AMF had a strong engineering background and they promised the existing Harley management would keep control.
AMF had a goal to boost production dramatically and generate new models. The production increase was pushed through too quickly with little regard for quality. As a result the AMF era Harleys soon gained the reputation for poor quality. Also, the top-down management meant that the long-term Harley-Davidson employees were being ignored. AMF was becoming frustrated with the money being spent on the company and the poor returns.
The 1980s was the turning point for Harley-Davidson. In 1981, thirteen members of Harley-Davidson’s senior management purchased the company from AMF in a buyout. The company needed to become more efficient in order to survive. They adapted three Japanese business methods; just-in-time inventory cut-down on money tied up in stocks of parts, employee involvement using the skills of people on the shop floor to affect decision making, and every worker was given the means to monitor his or her own quality and output. All three, known as the Productivity Triad, had a tremendous effect on efficiency, productivity and quality.
In 1982, the new ownership was also successfully in petitions to the U.S. federal government for tariffs on imported motorcycles flooding the U.S. market. This tariff was only for five years but allowed Harley-Davidson to recapture its lost market share.
In 1983, The Harley Owners Group (H.O.G.) was established. A year later, the new Evolution V-Twin engine was released. This new engine was more powerful, more reliable, quieter and didn’t leak oil. The engine was very well received and sales were booming. This was seen as an ideal time to go public, so in 1986 the stock began trading at $11 per share at its initial public offering. The Motor Company also regained its top position in the U.S. super heavyweight market.
During the 90s and 2000s, the company continued growing. The Harley-Davidson Financial Services is founded in 1993. They also acquire Buell Motorcycle Company and opened two new plants in 1998. In 2001, the VRSCA V-Rod is introduced with the first liquid-cooled engine in the Company’s history. The mission of the company is as follows, “We fulfill dreams through the experiences of motorcycling, by providing to motorcyclists and to the general public an expanding line of motorcycles and branded products and services in selected market segments.” They accomplish this mission by not just selling motorcycles but creating a family type atmosphere. As stated previously, in 1983, the Harley Owners Group (H.O.G.) was established. This is an organization sponsored by local dealerships for Harley riders to share their motorcycle experiences with each other though group rides and the H.O.G. magazine. I was a member of the...
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