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MACRO – Socio-Cultural. Europe The population growth in Europe has been increasing since 1999 through 2002. MACRO – Socio-Cultural. The market for motorcycles or two-wheeled vehicles has stabilized just under 25,000 after a spike in 1997. MACRO – Socio-Cultural.

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macro socio cultural
MACRO – Socio-Cultural
  • Europe
    • The population growth in Europe has been increasing since 1999 through 2002
macro socio cultural2
MACRO – Socio-Cultural
  • The market for motorcycles or two-wheeled vehicles has stabilized just under 25,000 after a spike in 1997.
macro socio cultural3
MACRO – Socio-Cultural
  • Registration of vehicles increased for passenger vehicles, but a decrease for two wheelers.
macro socio cultural4
MACRO – Socio-Cultural
  • Japan
    • The population has been steadily increasing for the past 10 years, along with the density and also the mean age of the population.
    • Currently the mean age of the population is 41.43 years
macro socio cultural5
MACRO – Socio-Cultural
  • The population aged 20-24 has been steadily decreasing since 1996
  • The population aged 35-39 has been steadily increasing since 1997
macro socio cultural6
MACRO – Socio-Cultural
  • High population density in Japan of 349.62 people per square km
  • A huge surge of car ownership of 64% in just over twenty years
  • Japan has an extremely strained road network.
macro socio cultural7
MACRO – Socio-Cultural
  • United States
    • There was significant population growth in the warmer climate states such as California, Florida, Texas and Nevada.
macro socio cultural8
MACRO – Socio-Cultural
  • Currently there are 5.5 million motorcycle owners in the U.S. but only 3.9 million are registered
macro political legal
MACRO – Political-Legal
  • Europe
    • Transportation regulations are set out by governments and agencies of the individual countries within the European Union
    • Legislation has been set forth to control emissions and braking systems.
    • Other laws regulate the use of motorcycles such as licensing, safety regulations, and equipment requirements.
macro political legal10
MACRO – Political / Legal
  • Japan
    • There is currently a new proposal for emission standards for Japan
    • The legal minimum age to drive a lightweight is 16 and 18 for heavyweights
    • Japan has responded to many American requests regarding laws for motorcycles and motorcycle riders.
macro political legal11
MACRO – Political/Legal
  • United States
    • All 50 states require motorcycle riders to obtain a special license to operate a motorcycle
    • Currently under the Motorcycle Helmet Act, states have different stipulations regarding mandatory use of helmets
industry overview
Industry Overview
  • The primary NAICS code is 336991
    • Motorcycle & arts Manufacturing.
  • The annual industry sales were reportedly worth $19.2 Billion in 2003
    • 12.7% increase from 2002 revenue totals.
  • The annual growth rate of the motorcycle industry over the span of three years is 4.11%.
industry overview13
Industry Overview
  • The 2003 industry return rates are above average when compared to other industries and are listed as follows:
    • Return on Assets (ROA) is 10.2%,
    • Return on Equity (ROE) is 22.7%
    • Return on Investment (ROI) is 37.9%.
industry overview14
Industry Overview
  • There are 17,151 people employed in the U.S. motorcycle industry alone.
  • Currently under the NAICS code 336991 there are 22 firms that operate solely in the motorcycle and parts manufacturing industry.
  • Some examples include BMW, Suzuki, Honda and Polaris Industries.
industry strategic group map
INDUSTRY – Strategic Group Map







Rough & Tough

Perceived Image




Quality of Product

value chain analysis
Value Chain Analysis

Corporate HQ/ Executive

3 Year sales increase

  • 28 % U.S,15 % Europe, 17% Japan.
corporate hq executive
Corporate HQ/ Executive
  • The return ratio’s are significantly higher than the competition’s
market capitalization
Market Capitalization
  • The market is confident that Harley-Davidson is going to remain a long term market leader.
corporate strategy vertical integration
Corporate StrategyVertical Integration
  • Harley-Davidson is a mid-stream company with its main focus on manufacturing motorcycles.
  • It would not be beneficial for Harley-Davidson to backwards integrate.
  • It would not be beneficial for Harley-Davidson to forward integrate
vertical integration
Vertical Integration

Potential Problems and Recommendations

  • The dealer/Supplier relationships is the foundation of its successful supply chain management
  • Harley-Davidson should continue to build positive relationships to retain the competitive advantage
corporate strategy horizontal diversification
Corporate Strategy Horizontal Diversification
  • Harley-Davidson is not horizontally diversified
  • Harley only has one NAICS code 336991
  • The industry of manufacturing motorcycles, bicycles and parts.
horizontal diversification
Horizontal Diversification
  • Harley-Davidson products and services include:
    • Harley Gear –clothing
    • Harley accessories
    • Harley-Davidson Financial Services
  • The merchandise and financial services act as catalysts to the sale of Harley-Davidson motorcycles and to the image of the Harley way of life.
horizontal diversification23
Horizontal Diversification
  • Potential Problems and Recommendations
    • Harley-Davidson is dominating the motorcycle manufacturing industry.
    • Harley-Davidson has such a loyal customer base, strong brand name and image
    • it would be detrimental if they diversify into markets unrelated to motorcycles.
corporate strategy geographic diversification
Corporate StrategyGeographic Diversification
  • Harley-Davidson currently operates in three main global regions:
    • North America,
    • Europe
    • Asia.
  • Harley-Davidson operates under a global strategy
  • It offers standardized products across global markets
  • Competitive strategy is centralized
geographic diversification
Geographic Diversification
  • International revenue accounted for approximately 18%, of net revenue
  • Harley-Davidson 2003 Market Share
    • 50% United States
    • 8% Europe
    • 26% Asia
  • Harley-Davidson outpaced the industry in sales in each region in 2003
  • It is recommended that Harley-Davidson remains in the European, Japanese markets
geographic diversification26
Geographic Diversification

Potential Problems and Recommendations

  • The company has expressed interest in other markets
    • South America, Africa and Southeast Asia.
  • Recommend that Harley-Davidson enters the Chinese market through a strategic alliance with Zongshen Motorcycle Group.
  • Not recommended entry into South American or African markets at this time