Harley-Davidson is the first half 2019 has lost 6.8% in the global sales projecting the year to the fourth lost in a row. Sales are declining in all global regions, with the significant exception of the ASEAN region, up 44% thanks to the boom in Thailand. Europe reported down 9.6% despite positive market trend.
2019 Global Registrations
During the first half 2019, Harley-Davidson global registrations deteriorated, projecting the year to be the fourth declining in a row.
Sales in the 80 countries actually tracked by our team have been 125.154 (so over 4k more than those officially announced by the Company as “retail”), losing 6.8% from the correspondent period last year.
North America still represents 61% of total sales, losing 6.1%, with Canada up 2.9%, US down 6.5% and Mexico down 12%. Sales are declining in the Indian Region (India, Pakistan, Sri Lanka) by 26.2% despite the launch of the 750 engine. Bad news from West Europe, with sales losing 9.6% and by Asia (China, Japan, Korea and Taiwan) which has lost 13.6%.
Positive is the ASEAN region, due to the boom in Thailand, with total sales up 44.4%.
Harley Davidson was founded in 1903 in Milwaukee, by 22 year-old man, William S. Harley and by his childhood friend Arthur Davidson. By 1920, Harley-Davidson was the largest motorcycle manufacturer in the world, with 28.189 machines produced and dealers in 67 countries.
In the long life of the company a dark period was between the 1969 and the 1981 when it was under the control of American Machine and Foundry (AMF). The re-launch started in the 1981 when AMF sold the company to a group of 13 investors led by Vaughn Beals and Willie G. Davidson for $80 million and the production was transformed using the just-in-time system, while the company was helped in the domestic market by high tariff raised against Japanese brands.
In the following years the company was transformed from an old fashion slow motorcycles producer to the American icon and the use of old style engines and traditional components changed from a weakness – compared to Japanese top of art technologies – to the strength, becoming a real business case in the global marketing. More than a bike, Harley-Davidson become a seller of a life style and become one of the most powerful icon of American freedom concept all around the World.
The first stone of this global brand strategy was based in 1983, creating the Harley Owners Group (HOG) to build on the loyalty of Harley-Davidson enthusiasts as a means to promote a lifestyle alongside its products. The HOG also opened new revenue streams for the company, with the production of tie-in merchandise offered to club members, numbering more than one million.
The iper customization and the sales of an entire world of accessories helped to develop revenues and margin around each single Harley bike travelling on the road and the traditional sound of the pot-pot old Harley engines was registered as a trademark, rather than be considered – as it was – an old style and obsolete technology.
The triumph of the myth was on June 1, 2008 when the Harley-Davidson Museum was inaugurated in a 12.000 m2 space and after over US$ 75 million investment.
However, in that day the crisis was already like a ghost behind the lights of the success. Indeed, the progressive aging of Harley customers did not find a solution while the new generation bikers grew up more under the myth of speed and technology and the American company started to lose terrain in the domestic market, while the grew of middle-high class people in new countries, helped to partially balance the domestic sales lost with export.
Production & Distribution
Harley-Davidson manufactures its motorcycles at three US factories in York, Pennsylvania, Milwaukee, Wisconsin and Kansas City.
Since 1998 the first Harley-Davidson factory outside the US was opened in Manaus, Brazil, taking advantage of the free economic zone there. The location was positioned to sell motorcycles in the Latin America market, which actually represents the 4.5% of global Harley-Davidson sales (including Mexico, supplied from US).
In August 2009, Harley-Davidson announced plans to enter the market in India, and started selling motorcycles there in 2010. The company established a subsidiary, Harley-Davidson India, in Gurgaon, near Delhi, in 2011, and created an Indian dealer network. Actually India represents only 0.9% of global company sales. FRom India vehicles are exported in China and in the large ASEAN region.
A key success of the development of Harley-Davidson brand strategy was the creation of Stores. Actually in the World there are 1.498 Harley-Davidson stores across the world, 698 are in the United States, followed by Europe’s with over 500 and then Asia with 276.