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HARLEY-DAVIDSON COMPETITIVE RIVALITY Major competitive peculiarity of Harley-Davidson's company is creating a low volume of motorcycles and selling them through a low number of distributors. This way creating a high demand for the product. As a result of the low volume and low distribution, they sell out all items they manufactured, thereby maintaining a waiting list to purchase a new Harley. Let us try to research other competitive advantages that company has in domestic and international markets, industry dynamics and company strategic steps. Motorcycle industry consisting of five major manufacturers: one American (Harley Davidson), and four Japanese (Honda, Yamaha, Kawasaki, Suzuki) and some European companies (mainly BMW of Germany and some other Italian companies) (Vance). Most companies sell their motorcycles and accessories through distributing networks, which consist of foreign distributors and domestic outlets.
Because of the recession, industry sales of motorcycles were decreasing in 90 s, but later level has reinstated. Unlike Harley-Davidson, other competitors have wide range of resources and products and this allows them to be more sensible to demand. Honda, for example, had more options for the budget-minded entry-level customer. Once entered into Hondas product line they felt that they would be able to get repeat business for their more profitable motorcycles due to customer loyalty (Vance).
It was very hard for Harley-Davidson to get new customers due to their limited ability to provide a new product and the high price of used Harleys. Harley-Davidson is unique when compared to its competition. There are no other major motorcycle manufactures in the United States. However, Some competition also came from domestic competitors in Polaris, Excelsior, and Indian. Polaris has had experience in the snow mobile market and was a leader in that market. The main threats for Harley-Davidson came from Japanese companies such as Honda, Kawasaki, Suzuki, and Yamaha.
In Japan all of Harley-Davidson's competitors are much larger and more diversified than they are. There are no Harley cars or lawnmowers, just motorcycles and motorcycle financing. The international motorbike market is very competitive. With only a 15 % market share of international business compared to 48. 1 % in the United States there is opportunity for Harley-Davidson to expand (2003 Annual Report 39). In order to enter the international market more effectively, company marketing should look wider. Consumers outside United States preferred less heavier bikes.
Thereby, to meet demand on motorbike market, Harley should diverse its manufacturing range. Although an image and brand of company may be injured this way. But if production can be increased, the possibility for more options can be realized. Worldwide retail registrations of Harley-Davidson motorcycles grew 8, 7 percent and exceeded the worldwide market growth rate for heavyweight motorcycles for the sixth year in a row. In North America, 2003 retail registrations of Harley-Davidson motorcycles increased 8, 2 percent over 2002. In Europe, registrations of Harley-Davidson motorcycles increased 11, 8 percent, and in the Asia/Pacific region, where the major markets are Japan and Australia, retail registrations of Harley-Davidson motorcycles increased 11, 7 percent over 2002 (2003 Annual Report 37).
In conclusion, we should state that Harley-Davidson had a strong domestic market share in the American motorcycle industry. Built on tradition and brand recognition, Harleys are a part of American culture. Unique products and loyal customers are the foundation of Harley-Davidson Inc. The only major obstacle the company faces is greater demand for their product than availability. Production has increased in the 90 s up to 2003 and profits are very high. Harley-Davidson has many Japanese competitors that have yet to hurt the sales of the core super heavyweight motorcycles.
Harley-Davidson should focus on increasing production, but not try to compete with Japanese competitors (Vance). They can keep their profits high by building less super heavyweights than there is demand while using increased production on more entry level, high quality motorcycles. Bibliography: 2003 ANNUAL REPORT. HARLEYDAVIDSON, INC. 2003. Homepage. < web > Chris Vance. ANALYSIS OF HALEY-DAVIDSON 1998.
Prepared by Chris Vance. EXECUTIVE SUMMARY. < web >
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Research essay sample on Harley Davidson Motorcycle Industry
