Saturday, September 23, 2006

Harley Davidson Almost Closes

Back in 1981 H-D, after losing sales and having quality concerns with their motorcycles under AMF, gathers the signatures of 13 top executives for a buy back. In 1982 they visit a Honda plant to learn how to update the manufacturing process to meet quality concerns to bring the company back to the top. It's funny how things come back around when you understand that Harley Davidson was the one who gave Japan's motorcycle industry the know how about clean and reliable manufacturing processes in the first place after WWI. That is if you know that it was H-D who went to Japan, set up a state of the art factory back then and then gave them blueprints as well as the blessing to manufacture Japanese Harley's under the name of Rikku. These were motorcycles that are carbon copies of the American company. These same Japanese Harleys would also be used during WWII by Japans army.

1983 brings H-D in with the motor company still reeling from backlash and lost customer loyalty from the AMF years. They asked for tariffs relief from Japans motorcycle industry dumping motorcycles here in the states which flooded the market making H-D lose even more market share.

In 1984 Harley ended the ShovelHead era and brought out the Evolution power plants that were more reliable and tighter engines. These new engines also ran cooler and produced more power than their predecessors after seven years of development. But even with the addition of the HOG club the company is still struggling to survive and grow. The company has to try and over come years of consumer confidence from the AMF ownership which began in 1969.

1985 brings the company to it's knees which almost leads them into bankruptcy. The CEO uses marketing plans adopted from the Japanese to sway lenders to accept a new plan in which better production quality and marketing lead to the road to recovery. The company strives and excels in beginning it's long needed climb back to the forefront.

Only a year later,1986, they become publicly traded on the stock exchange. Part of the marketing is to target the main stream population while trying to distance itself from the loyal customers who kept HD afloat for so many years. It is an image that HD wishes to put behind them in order to move forward. The move angers the long loyal customers who believed in the company even with it's decline. These are the people who kept the company afloat for so long but also did not help the company to move forward. Prices on the new models continue to grow from what was once an affordable option from expensive automobiles to what is today the same or even higher a price. This was one way to distance itself from the hardcore biker and the steretype.
The other side of the coin is that the company relied on these customers and continued to live off of it's legacy and did little to address the manufacturing concerns until it was almost to late.

You have to understand though that HD is an American icon and has fought many uphill battles, supplied and helped military war efforts, the knowledge and willingness to look outside itself for new and better technologies and processes. They helped other country's excel in manufacturing processes and have done what no other American motorcycle manufacture has ever been able to do- survive in an ever changing world.

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