External Analysis of Harley Davidson



External Analysis of Harley Davidson

Introduction

Harley-Davidson is one of the few leading automotive companies, which manufactures heavy motorcycles accessories, spare parts, general merchandise and apparel. The company is also known for providing services pertaining to finance such as retail, wholesale insurance and financing related programs. Harley operates in the USA, primarily. It has its headquarters at Milwaukee, Wisconsin and as on December 31, 2011it has employed about 6,600 people.

HD products are widely used by the American and the Canadians. However, HD has its presence in all the major and important parts of the world, (Campbell, 2002). The immense popularity of these bikes and the products that are manufactured by the HD, have created both opportunities and challenges for the company. These challenges force the company to reconsider their strategies and plan out their resources carefully.

In our discussion we will be focusing on the external analysis of this company. We will be talking about the Porter's five forces and the impact they have on the HD Company. We will also be talking about the PEST (Political, Economical, Social and Technological) analysis for the HD Company.

Discussion

Porter five forces

Porter five forces play a major role in determining various business related activities for any organization. Since HD is in a business that involves usage of heavy technology and also requires unique marketing tactics to be adopted, it is essential for HD to carefully study the forces in action, and come up with a strategy that can best meet the opportunities and challenges.

The market related to motor cycles contains all classes of off road and on road and motorcycles, which also include scooters and mopeds, which are those vehicles that are powered two-wheeler having an engine capacity which is less than 50 cc. They are also generally equipped for propulsion that is non -motorized with limited maximum speed. For this profile purposes, all two-wheelers other than the mopeds are classified as 'motorcycles'. The motorcycle industry of the USA is declining.

Later Market Decline will have a tendency to dampen new Entrants to the Market, however strengthen Rivalry between the occupants, a large portion of which are vast Multinationals. Purchaser Power is debilitated by large amount of item separation and Customer Loyalty regarding overwhelming Brands. Around the Suppliers there are suppliers of Commodity things for example metals, and their energy is helped because of their vast size, combining of the Industry and the way that Motorcycle Producers elucidate just a modest portion of their incomes, (Wayman,2001). For New Entrants to the business, setting up a Production Facility includes extensive Capital expense subsequently constituting noteworthy Entry Barrier and elevated Settled Cost. Moreover the Global tightening of outflow measures is increase Costs further as Cruiser re-plans are needed.

This pattern can trigger the interest for more current, more Economical Motors, including higher Costs of R&D using. Different methods of Transportation constitute the essential substitutes inside the business sector, and the danger of Substitution is expansively indigent upon the need of Cruiser use ...