Harley-Davidson 3-Year Plan

Last Tuesday Harley-Davidson held an analyst meeting in Milwaukee to update investors on the first 18 months of its three-to-five year restructuring plan. Harley-Davidson stated that restructuring plans are firmly in place and that the company is on its way to saving money, being quicker to market with new products and expanding abroad. Management confirmed that the company’s turnaround plan calls for achieving $300 million in cost savings by 2013 and driving efficiencies at production plants and in the way products are brought to market. Harley plans to continue expanding internationally and to add between 100 and 150 new dealers through 2014 in more than 30 countries.

Harley-Davidson is ready to have a different strategy from one country to the other, to ship complete bikes abroad or to send kits only to be assembled locally. In the US Harley-Davidson intends to shorten the time it takes to bring a new model to market from 5 to 3 years. A new program let dealers order custom bikes directly to the factory, lowering costs for the customer and increasing dealer profitability.  

Plans to restructure to save money by being more efficient didn’t stop after the plants reorganization in Wisconsin. On Wednesday, Harley-Davidson officials informed Kansas City employees that recent internal studies have shown “significant cost, efficiency and production flexibility gaps” in local operations. Employees were told that if ways can’t be found to address the gaps, the company will consolidate the Kansas City operations into the vehicle final assembly operations at its York, Pa., facility. A big warning before Harley takes a decision during the 1st quarter of 2011. Harley-Davidson.

Did you know? By 1920, Harley-Davidson was the largest motorcycle manufacturer in the world. New Harley-Davidson® motorcycles could be purchased from over 2,000 dealers in 67 countries worldwide

Zipper's

18 Responses to “Harley-Davidson 3-Year Plan”


  1. 1 fuji Nov 4th, 2010 at 8:01 pm

    Damn. Everyone should just be dumbfounded. LOL. The new era is here. Slowly fading away is our hero Harley Davidson. We have become worldly, took all your money and looking for new.

  2. 2 Coby Nov 4th, 2010 at 8:36 pm

    It’s ONE world. All companies will go to produce where it is the most profitable for them. An Anerican company is American because it was created in America. Nobody is upset because Apple, an American company, is assemblig all its products in Asia. It’s still an American success story. Young people don’t care where a product is produced. When all Harley old farts will be dead (soon) nobody will object Harley producing all over the world. Harley-Davidson is pursuing the correct business strategy. The problem is not Harley but it’s ex core customers.

  3. 3 fuji Nov 4th, 2010 at 9:13 pm

    Coby

    So right you are. Survival regardless but to many this digs into the bone of who they want the company to be.

  4. 4 cwglide Nov 5th, 2010 at 11:17 am

    I’m glad to see that HD restructuring. They need it. After periods of growth they experienced their operations grew and now its the lean times so they have to adjust to it. I like the fact they will lower the development cycle from 5 – 3 yrs. It was 5 yrs??, not wonder they were late to market! I wonder how true they said about lowering their cost so they can lower the selling price. Or will they increase their profit margin to improve their balance sheet? I wonder how the resale value will hold up from the impact of a lower selling price on future models. Time will tell. The only problem i have is outsourcing manufacturing overseas, taking our jobs. Its one thing manufacturing overseas like in India to support that market but its another thing when they outsource manufacturing for U.S. market taking our jobs.

  5. 5 Pepe Nov 5th, 2010 at 12:07 pm

    Harley-Davidson bikes must be manufactured in the US.

  6. 6 gravey158 Nov 5th, 2010 at 7:29 pm

    am going to piss of alot of people. they can do what ever they want. and people will still buy their product. thats how they look at it.its us who sees it differently. its a way of life. the newbie does not understand.

  7. 7 David Nov 6th, 2010 at 12:10 am

    Do you think that Harley reps are part of the corporate contingent thats on the plane with Obama and his trip to India this week all at Taxpayer expense?

    SSDD; David

  8. 8 Bryan Nov 6th, 2010 at 6:13 am

    David. Yes, American companies trying or already doing business with India have reps traveling with Obama.

  9. 9 Leif Nov 7th, 2010 at 5:52 am

    New models? You mean it’s only going to take 3 years instead of 5 to pick a different color of paint?

  10. 10 Brett Nov 7th, 2010 at 10:33 am

    HD’s MUST be manufactured in the U.S.????? Until our government figures things out & starts to understand having the highest tax in the world on companies, that they will continue to leave & take jobs with them, not just stay here. Companies are taxed 35% here. In the Europe it’s 15%. It is even less when you get around Asia & India. It’s why we keep seeing our jobs go to places like India.

    Our Government’s greed is bankrupting all of us.

  11. 11 Bradford Nov 7th, 2010 at 10:40 am

    Brett. You should void your comment. European corporations & individuals are taxed at 50%. As a matter of facts, corporations there can’t amortize investments as much as here and individuals can’t deduct real estate taxes and mortgage interest from their taxable income. I know, I lived in Europe during the last 9 years.

  12. 12 Geez... Nov 7th, 2010 at 10:42 am

    Brett must listen and believe Republican bullshit.

  13. 13 Cyril Huze Nov 7th, 2010 at 10:55 am

    Brett. For example in France. The tax is payable upon the net profits of the corporation and the rate is currently fixed at 33.33%, plus a surtax of 3%, which brings the effective tax rates to 34.33. In addition, Social security contributions are levied on each gross salary at 35 to 45% for the employer, and 14 to 20% for the employee. Don’t forget that you can’t compare tax brackets without knowing how taxable income is calculated. European corporations & individuals have many less available tax deductions than their US counterparts. The US has overall a much lower level of taxation than any European country.

  14. 14 just my opinion Nov 8th, 2010 at 11:44 am

    The comments on taxes being too high do not work but I can tell you that the labor rates are a major factor in US companies leaving. Here in the US an average worker will earn 15-20 per hour minimum but in some countries the employees earn as little as 5- 10 dollars per day. In most parts of Mexico employees earn as little as 5 dollars per day and they work 12 hour shifts not 8 hours as we do here in the states. If a company has 20 hours labor in a product and they pay 20 dollars per hour they must ad 400 dollars to the price of their product to break even but if that same company can build that product in Mexico and pay 10 dollars in labor the differences in price ads up rather quickly. I do think that our government should tax products coming in from these countries that have such cheap labor.
    Another problem for Americans is that some countries such as China will limit the amount of products we can sell in their markets but our government allows them to flood our markets with their products. I believe that if we are to have free trade it should truely be free trade, we should be allowed to sell as much as we can in their country and they in ours. And if countries want to limit our access then we should do the same to them. The United States is the largest consumer of goods in the world and as such we need to keep things fair. Fair for Americans as well as keeping things fair for the rest of the world as well. And as I have stated many times before the easiest way to keep our country ahead of the rest of the world is for Americans to buy our own products over products from other countries when ever possible. I read just last week that foriegn car sales in the US has fallen and now the younger drivers are buying Ford ,Dodge and Chevy more than in the past so maybe Americans are starting to wake up.

  15. 15 David Nov 9th, 2010 at 11:51 pm

    I wonder why the govt doesn’t want to keep jobs here…Maytag just shut down and went to Mexico..I believe Donald Trump has the right answer…Tax everything coming in here at 25% and let’s quit rebuilding and arming other countries with our money.. especially China….we need to rebuild America not print money and then give it away…..Watch Glenn Beck this week and his info on George Soros !!!!

    SSDD;David

  16. 16 live2rideaglide Nov 11th, 2010 at 5:06 pm

    Harley Davidson ‘s first priority , as any other American company , is to survive. If the company continues to drop sales and incur higher operating expense it will fail. What they do to remain viable is the issue with most people , especially bikers. Our patriotism behooves us to detest the idea of an American icon like Harley Davidson being put together by any other people than Americans. The irony and almost hypocrisy is that many who dont want there products made somewhere else are the same ones who whine about the price. Recently I priced a product to a customer and the first thing he said was , was it made in America? I told him it was made in Japan and immediately he replied , Won’t buy nothin not made in America. So then I priced him an American made alternative, which was almost twice as much. He then decided that the foreign made one would be alright. In that instance it seems his patriotism had a price. It aint an easy problem and it aint all the goverment. I am guilty as anyone of buying the cheaper foreign made WalMart brand than the good ol USA version and I probably will continue . I may not beat my chest as much. I love America even if I don’t always buy American.

  17. 17 Ben Nov 19th, 2010 at 3:16 pm

    If only that were true….companies aren’t just interested or motivated by viability anymore….max profit is the name of the game now….the bottom line above ALL else. Hello global economy….the sooner it settles in the less pain in the wallet we have to endure.

  18. 18 James May 2nd, 2011 at 2:49 pm

    Harley now looks like GM, having too many models, some models are not attracted to customers at all. Harley need to remodel its models and get rid of some models, thus Harley will be able to lower its costs and selling prices.

    Thanks, James

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