Group Presentation

Overview
• Brief History of HD • Internal Analysis
• Where we are now
- Value Chain
- Boston Matrix
• New Vision and Mission
• SWOT Analysis
• External Analysis
• Conclusion
- Competitor Analysis
- PESTLIED Analysis • Q&A
- Porter’s Five Forces

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 HISTORY
Foundation
It all started in Milwaukee, Wisconsin in 1903 when William, Walter,
and Arthur Davidson, along with William S. Harley, created the first
Harley-Davidson in their family shed.

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 Continued…
1906, the Harley-Davidson Motor Company was incorporated.
WWI & WWII spurred growth for the company due to the militaries
demand for HD’s economical motorcycles.
After WWII, the improved American economy, and higher demands
for Harley-Davidson bikes encouraged the company to expand its
efforts and purchase additional manufacturing capacity.

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 HD Today
• Manufactures heavyweight Custom & Touring Motorcycles

• Owns Buell Motorcycle & Eagle-mark Financial.

• Has over 1,500 dealers worldwide.

• Foreign business is about 18% of Sales; R&D, 3.2%.

• Has about 8,800 employees.

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 Existing Mission
“ We fulfill dreams thorough the experience of
motorcycling, by providing to motorcyclists and to the
general public an expanding line of motorcycles,
branded products and services in selected market
segments ”
Proposed Vision
“ To be recognized as the best
motorcycle company in the world ”

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 External Analysis
Competitor Analysis

Asia/ Pacific
Market Share
25.8%
Europe
America Market Share
Market Share 8.1%
48.1% Higher Price

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 American Market

Kawasaki, 7.50%
Others,
8.30%
Harley
Yamaha, 9.20% Davidson,
48.10%
Suzuki, 12.70%

Honda, 14.30%

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 PESTLIED ANALYSIS
PESTLIDE ANALYSIS
Political
Low taxation from U.S government could encourage Japanese &
European competition within the US.
Economic
Global recession is effecting economies world wide therefore HD has
to sustain its position in the market.
Social
More diverse lifestyles, Creating many Harley Clubs and academies
around the globe like Rider’s Edge.
Technological
New materials and other technologies are giving potential for
innovative / customized motorbikes.

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 Continued…
Legal
Different taxation method in different countries especially southeast Asia
where HD is facing legal issues due to excessive excise duty.
International
Volatile international market situation is restricting HD to capture new
markets.
Environmental
Noise and some emissions standards of HD bike is not up to the level of
some countries across the globe.
Demographic
Average purchaser of HD is mid forties married man with household
incomes averaging $78600 while only 9% of consumers are women.

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Porter’s 5
Forces New Entrant
• High Entry Barrier

•Economies of scale

•High tech Involvement

•Small scale Producers minimum

threat

Power of Buyer
•Low power of customer as they
are individual
•Less no. of Dealers also rely on
individual customers
Internal Rivalry
•Honda, Yamaha, Suzuki ( All POWER OF SUPPLIER
Japanese)
•Out source Steel, Basic
•Honda mainly competing in U.S
Electronics
•Strategic Alliance between Suzuki •Assembly within the Company
and Kawasaki
•Ease of switching suppliers

Substitute Product
•Very few substitute as luxury
bike.

•Cars, scooter and sports car.

•NO subs when looking for

luxury bike.

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 Internal Analysis
Value Chain
VALUE CHAIN
Firm Infrastructure
Good Senior Management Has Transformed The Firm But It
Remains Small Compared To Global Competitors.
HRM
Excellent But No Skills or Abilities Outside US.
Procurement
Very Good Relationship With Streamlined Supplier Base, and New
Brazil Operations Can Reduce Cost Further.

Inbound Operations Outbound Marketing & Services

Logistics Logistics Sales

Good Advance Excellent Very Good Excellent Excellent In US

JIT Procedure Highest Level Because of Relations & But Weak
Operations Good Shipment Brand Strength Outside

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 Internal Analysis
BOSTON MATRIX

HD

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 SWOT ANALYSIS
Strengths
• Financially sound position, net income in 2008 was $1357.4 m .
• Only major manufacture in US but now set up a huge plant in Brazil.
• Financial services purchased in 1995 ( Eagle Mark ).
• Dealers in 67 countries.
• Very strong brand image in the U.S as an American Icon.
• Extremely loyal and valuable workforce in U.S strengthening the brand
themselves.
Weakness
• Still small compared to the competition, limiting their ability to invest in new areas
• Probably less efficient then their competitors as they own very few assets outside
U.S.
• Brand image is HD’s strength but is limited outside the U.S.
• Customer loyalty outside US is low due to lack of after sale services.
• No or very few Human resources outside the U.S in marketing and other fields.

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 Continued…
Opportunities
• Asian economy is booming, China is the only place not effected by global recession.
• Increasing demand for the bikes in US.
• New dealers can be found in South East Asia and Middle East.
• Interest rates are at historical lows.
• Globalizations gives the opportunity to reduce cost and gives the potential to form
useful relations with firms across the globe.
• Alliances with Ford Motor Company or other automobile manufacturers are possible.

Threats
• The European Union’s motorcycles noise standards.
• Risk of small custom bikes manufacturers joining the big companies.
• Competitors are all from Japan & have more affordable and diversify range of bikes
• Decreasing brand loyalty means the buying decisions are increasingly based on
PRICE & PERFORMANCE.
• Harleys average buying age is 42 years old and increasing.

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 Conclusion
• Increase diversity programming
• Explore opportunities for physical plant expansion into other
geographic areas to increase labor pool
• Bring HD heritage to the rest of the world.

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 Questions

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