Harley-Davidson Turning their Sights International

In search of greener pastures

Amid waning domestic popularity, Harley-Davidson has refocused their efforts on growing markets abroad. The potential rewards cannot be overstated, but between strong foreign competition and an ongoing trade war, HD definitely have their work cut out for them. A 2017 fiscal report noted that 61% of the company's sales from that year came from within the US. Harley has relied on their American customers to an even greater extent in the past but slowed interest in bikes in the years post-recession has given them cause to reconsider. The domestic market's not kaput by any means, but that's beside the point; the truth is that Harley-Davidson's aggressive, ambitious behavior as of late would not make sense if they didn't have aims to make a comeback.

The North American problem

As a "recreational vehicle" manufacturer, Harley-Davidson was dealt a rough hand with the 2008 Recession-- as rough a hand as any that made it through. Things have since gotten better (and continue to improve) but the current North American market finds itself dominated by practical all-in-one vehicles. Motorcycles simply haven't retained their popularity. Younger riders are outnumbered by a Baby Boomer majority. The millennial-aged Harley rider experience is not complete without having cringed at least once hearing someone dismissively refer to them as "dad bikes". At the same time, it's a hard point to argue. The older riders are not being replaced in sufficient numbers by new customers. At least not in North America, that is.

>>Join the conversation about HD's plans of worldwide expansion right here in HDForums.

An undeserving victim of the trade war?

Much ado has been made over the world of the Trump-orchestrated trade war. While there are valid concerns behind this surge of American protectionism (some would argue it's long overdue) the natural retaliation from foreign governments have put Harley-Davidson in a rough position. A 31% tariff on US-produced motorcycles in the European Union has forced HD's hand in having to move their production out of the country. Harley interest in Western Europe has shown healthy signs of growth, but tariffs like that negate the benefits. While President Trump first praised Harley-Davidson, he was vocally critical of their decision to move shop. Harley-Davidson is as American as apple pie, but in this instance, they've been pushed into a spot where it might make more sense to pick the other side.

>>Join the conversation about HD's plans of worldwide expansion right here in HDForums.

Asia-Pacific: promising potential

Of anywhere in the world, the most notable growth in motorcycle demand is Asia. Growing middle classes in China and India offer logical opportunities to expand HD's business in the region. Their recent plans to set up a plant in Thailand confirm that they're looking Eastward. Although Harley's reputation extends worldwide, the Asian market holds them at a disadvantage in many respects, namely from the established Asian bike manufacturers. While they plan on developing plants of their own, they're also establishing ties with regional companies. One such partnership has already been announced creating lightweight models in South Asia. Though the local company's identity is not yet known, when last checked, this multi-faceted expansion strategy goes to show they're not messing around.

>>Join the conversation about HD's plans of worldwide expansion right here in HDForums.

Different bikes for a different market

Harley-Davidson's announcement that their foreign market bikes will emphasize their smaller, lightweight variants is part of a broader strategy to branch out their model lineup. Historically, the Japanese bikes were sleeker and cheaper, and often cited as a source of their sales frustrations. Harley's lightweight Street models are their way of biting back. Coincidentally, they're a perfect match for an increasingly urbanized Asia. It's also worth noting that this lineup diversification (including the debut of EV bikes in 2019) will have a significant impact domestically as well.

>>Join the conversation about HD's plans of worldwide expansion right here in HDForums.

There's company history yet in the making

There are more reasons to feel optimistic for Harley-Davidson as a business than we ever might have guessed a couple of years back. They're being fierce and taking initiative wherever the opportunity beckons. Still, there's a lot that remains unclear. It's difficult to say how and when the trade dispute will end, and that's not all; Harley-Davidson's Street models are still relatively new and unproven to customers. While they benefit from the brand association, there's enough distinction from the heavyweights that they'll need to justify their own merit. It may still be too early to reasonably comment on where all of this is headed. If one thing escapes all doubt, however, it's that this is a very historic time for Harley-Davidson as a company. Things may be up in the air, but judging from their assertive readjustment, it may well be that the cards ultimately work in their favor.

>>Join the conversation about HD's plans of worldwide expansion right here in HDForums.

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