Harley Davidson :: Business Management Essays

Overview Harley-Davidsons management had frequently to be proud of as the guild wrapped up its Open Road Tour centennial exultation that began in July 2002 in Atlanta, Georgia, and ended on the 2003 Memorial Day weekend in Harleys hometown of Milwaukee, Wisconsin. The 14-month Open Road Tour drew stupendous crowds of Harley owners in each of its five stops in North the States and additional stops in Australia, Japan, Spain, and Germany. Also during its 2003 centennial year, Harley-Davidson was named to Fortunes list of 100 Best Companies to Work For and was judged third in self-propelled quality behind Rolls-Royce and Mercedes-Benz by Harris Interactive, a worldwide market question and consulting firm best known for the Harris Poll. The communitys revenues had grown at a compounded annual rate of 16.6% since 1994 to reach $4.6 billion in 2003marking its 18th consecutive year of record revenues and requital. In 2003, the political party sold more than 290,000 motorcycles, givi ng it a commanding share of the 651+cc motorcycle market in the U.S. and the leading share of the market in the Asia/Pacific region. The consistent growth had allowed Harley-Davidsons share price to instruct by more than 15,000% since the federations initial public fling in 1986. In January 2004 the companys CEO, Jeffrey Bleustein, stated that Harley-Davidsons earnings growth rate should fall in the mid-teens for the foreseeable further and the company expected to increase unit sales to 400,000 units by 2007. However, not everyone was as bullish *This teaching note reflects the thinking, insight, and analysis of case authors, Professor conjuration E. Gamble and Diplom-Betriebswirt Roger Schfer, both of the University of South Alabama. on Harley-Davidsons future, with analysts pointing out that the companys plans for growth were too dependent on aging nipper boomers. The company had achieved its record growth during the 1990s and early-2000s primarily through the appealingness o f its image with baby boomers in the U.S. There was some question how much longer boomers would choose to spend recreational time touring the country by motorcycle and attending motorcycle rallies. The company had yet to develop a motorcycle that appealed in large numbers to motorcycle riders in their 20s or cyclists in Europe who both preferred performance oriented bikes earlier than cruisers or touring motorcycles. Another concern of analysts watching the company was Harley-Davidsons short-term oversupply of certain models brought about by the 14-month production run for its centesimal anniversary models.