Harlley Davidson, Hyderabad

2. • Harley-Davidson, often abbreviated H-D or
Harley, is an American motorcycle
manufacturer.
• From 1977 to 2014 the only motorcycles sold
to the public under the Harley-Davidson
brand have been heavyweight motorcycles
designed for highway cruising, with engine
displacements greater than 700 cc.
• Harley-Davidson motorcycles, or "Harleys",
are noted for the tradition of heavy
customization that gave rise to the chopper
style of motorcycle.

3.  On the verge of bankruptcy in the early 1980's,
Harley-Davidson found itself facing severe market
conditions and heavy foreign competition.
 Through applying unique strategies, clever
positioning, hard work and passion turn their last
remaining American motorcycle manufacturer from
the rust bowl of the Midwest into a Fortune 500
company success story.
 Harley-Davidson accomplished this through not
only focusing on the four basic "P's" of marketing,
but by adding a fifth "P" -PEOPLE, the most
important ingredient in any business turnaround.

4.  Harley-Davidson was found in 1903 by Arthur
and Walter Davidson and William Harley. By
1918 Harley-Davidson became the worlds
largest motorcycle company by producing
28000 motorcycles.
 The first downtown in the firms fortunes
occurred in the early 1920s when the
production dropped to 10,000.
 Despite the decline it invested in R&D and a
new four cylinder engine.Hence minor
increase of reliability was seen till 1930s.

5. With the advent of the second world war
and military use of Harley Motorcycles
production soared to 29000 in 1943.
During the post war period, Harley-
Davidson experienced pressure from
foreign imports, mostly from Europe.
By 1952, weak demand for motorcycles and
Harley-Davidson’s continuied market share
losses to European imports placed a heavy
burden on firms financial resources.

6.  In the mid 1950s registrations in the US
amounted to 550,000 units, Harley –
Davidson remaining the undisputed leader
with over 60% market share and $20 million
sales.
 in the late 1940s and earl 1950s Harley-
Davidson established a image of ran power
which became its major selling point.
 The growl of the Harley engine is described
as “a bassaprofundo thump that makes other
motorcycles sound like sewing machines.

7.  In 1959 Honda uncovered a large untapped
customer base of older males and younger
women.
 By 1965 Honda made a substantial inroads in
to US industry one out of every two
motorcycles sold in US were of Honda.
 Other Japanese firms such as
Suzuki,Yamaha and Kawasaki soon followed.
 Between 1963 and 1973 motorcycles sales
increased at an annual rate of 33%
 Soon japanese manufacturers accounted for
about 85% of the US motorcycle sales.

8.  Harley-Davidson was aquired in a friendly takeover
by AMF.
 The influx of new capital allowed it to expand
production from 15,475 units in 1969 to 70,000 in
1973.
 In order to increase production less skilled workers
were added and quality decreased to all time low.
 To challenge Japanese manufacturers in smaller
and faster growing segment it entered a joint
vencture with Ameracchi of italy.
 With the little interest in smaller Harley bikes the
firm terminated its Italian joint vencture in 1978.

9. In 1975, to target Harley Davidsons market
segment Honda introduced Goldwing , a
1000cc motorcycle.
Soon Kawaski followed.
The falling prices resulted in economic
downturn and declining overall market in
US.
Between 1970 and 1980 Harley –
Davidsons share declined over by 80%.

22.  To address the challenge, the team met for four
days of strategic planning and went through a
process of analyzing the strengths and
weaknesses of not only Harley-Davidson but the
competition.
 What came out of the meeting was a strategy "turn
left when the competition turns right", and
application of that strategy to the basic four P's of
marketing. That is: product, price, place and
promotion.
 In other words, Harley decided it was almost
impossible to compete against the competition on a
heads-on basis. So they decided to be the
alternative and do things that the competition
couldn't do. For an example, Mr. Honda cannot ride
from LA to Milwaukee and raise $100,000 for
muscular dystrophy. Willie G. Davidson does!

23.  Applying this strategy to product, a team of
manufacturing and engineering personnel
traveled to Japan to study how they made
motorcycles.
 What they came back with, compelled Harley
to introduce just-in-time inventory, statistical
operators control, and employee involvement.
 Applying the strategy of "turning left when the
competition turns right", focused the Styling
Department to implement a classical,
evolutionary design for motorcycles, rather
than the revolutionary design of something
new every year from the competition.

24.  Applying the strategy to price, Harley-Davidson promoted the
fact that their motorcycles retain the residual value.
 Harley-Davidson drove a wedge between Harley and the
competition by communicating a comparison of the fact that the
competition's motorcycles depreciated 25% - 50% in the first
two years.
 Over the last 30 years, the factory, the dealers and the riders
have raised over $70,000,000 for this association.
 Applying the strategy to place, Harley initiated a store redesign
program with its dealer network to create an atmosphere where
the customers would feel not only comfortable in coming to a
Harley dealer, but use it as a meeting place, a destination that
attracts not only Harley riders, but other potential customers.
 The program has generated tripling revenues with the majority
of the dealer network and is an award winning program that has
been recognized by leading retail consultants.