In 1988, the Harley-Davidson Motor Company loaned me a brand new red Harley Electra Glide and invited me along on a ride from Maine to Milwaukee to celebrate Harley’s 85th birthday. I wrote several stories about the ride and about the company’s resurgence from the road. I also had a blast! This story was one that I wrote once I returned to Maine. This clip was published in the Chicago Sun-Times, but the story was also published in papers around the country, as well as in Europe and Australia.
Harley roars back to lead the cycle pack
By ARTHUR FREDERICK
MILWAUKEE (UPI) – Harley –Davidson Motor Co., careening toward extinction just five years ago, has roared back to lead the pack, scooping up an increased market share from the best of the Japanese motorcycle builders while placing itself solidly in the black.
It was a different story in 1983, when Honda and other Japanese motorcycle makers pushed Harley, America’s only surviving motorcycle manufacturer, to the edge of bankruptcy. But Harley searched its past and re-discovered a formula that seems to be redefining the company’s future.
The quality of the big V-twin engines Harleys had declined seriously over the years, and antiquated manufacturing techniques kept costs high and production low.
When Japanese builders such as Honda and Yamaha began building low-cost, high-tech super-heavyweight touring bikes, once the sole domain of Harley-Davidson, a number of former Harley riders jumped ship.
“We simply weren’t building a product that the customer wanted from a quality point of view, “ said Richard Teerlink, Harley’s president. “The customer needs quality, especially when he is paying a premium price for the product.”
Harley had once dominated the large-displacement motorcycle market, but by 1983 Harley’s market share for motorcycles of 851cc or more had faded to just 23.3 percent, while Honda’s share of the market had swelled to 44.3 percent. And there seemed to be no end to the downward trend.
“They used to call me Dr. Doom around here – my reports were always that the sky was falling,“ said Frank Cimermancic, Harley’s director of business planning.
With its back to the wall, Harley began fighting back.
The company claimed Honda and other Japanese manufacturers were dumping big-displacement motorcycles in the united States in order to harm Harley, and asked the Reagan administration for stiff tariffs on the biggest Japanese bikes,. The administration responded with a five-year tariff plan.
With the tariff providing some breathing room, Harley went to work and began devising a strategy for getting back on solid ground. Harley’s strategy worked so well that by the end of 1987, its market share had zoomed to 40 percent, and was still climbing steadily.
In the first quarter of 1988, Harley’s share climbed to 50 percent, while Honda slipped to 22 percent.
“We are really smoking,” Cimermancic said. “It is hard to believe, if you had told me five years ago we would be doing this kind of volume now, I would have asked you where you got your drugs from.”