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Riding High

Wait Two Years for a New Harley-Davidson? That's How Long It Can Take to Get Delivery on America's Motorcycle Wait Two Years for a New Harley-Davidson? That's How Long It Can Take to Get Delivery on America's Motorcycle
Mark Vaughan
From the Print Edition:
Ron Perelman, Spring 95

(continued from page 1)

By 1987, in an unprecedented move, Harley's new masters were confident enough to petition the ITC again--this time to ask that the 1983 tariffs be lifted a year ahead of schedule. "It might seem like a strange thing to do," admits Teerlink. "But it really gets down to values. We'd upgraded and refined our designs, revamped the entire production process, and sales and customer satisfaction were high. We just didn't believe it was right to continue operating in a protected market because we'd accomplished what we'd set out to do."

Mike Lombardi agrees that Harley made a spectacular recovery. "The situation completely reversed," says the Staten Island motorcycle dealer. "Now when you sell a unit to a customer and you see him the next day, you don't have to hide. He comes back in, and he's got a gigantic smile on his face. Harley-Davidson really got tuned in to what the customer wants in design and quality."

Another measure of Harley's renewed success lies in the difficulty that many new customers have in purchasing their first Harley bike. Virtually all the motorcycles rolling off the line that day at the York plant had been presold, as is the company's entire 1995 production run. Because factory shipments are now on an allotment-only basis, most motorcycle dealers will give preferential treatment to established customers, with new buyers having to wait as long as two years or more to take delivery on a bike.

"Our '95 and '96 allotments are completely sold out," says Mike Laugerman, co-owner of Laugerman's Harley-Davidson in York. "We won't start taking orders for the '97 models until August 1, 1995." At Brunswick Harley-Davidson in Brunswick, New York, manager Adam Ginsburg notes that there are still some 1995 Sportster models available. "But if you want one of the heavier bikes, you are going to have to wait at least a year to get it, if not longer," he says.

To keep up with growing demand, Harley has steadily increased production to about 100,000 units a year. But with memories of the disastrous '70s still fresh, the company is determined to take a conservative approach to expansion. "We don't ever want to get into an excess production situation again," insists Teerlink.

The lack of new machines has fueled a boom market for older Harleys, with used bikes often selling for as much as or more than new models. "The only way we can stock our showroom is by paying premium prices for used motorcycles," says Ginsburg. "We in turn price them high, but they continue to move. It's definitely a seller's market."

The excitement surrounding Harley-Davidson is reflected in the ultimate measure of any U.S. corporation's success, the value of its stock. To get out from beneath the staggering leveraged-buyout debts, Harley's directors took the company public in 1986, a move that not only raised enough cash to buy out its loans but also generated a $50 million surplus. Harley stock, which initially opened at $11 and has recently been split, currently sells in the $27 range. "Are we pleased with the way Harley's stock has performed?" Teerlink asks rhetorically. "We're ecstatic."

* * *

Throughout Harley-Davidson's history, hog fever has struck many illustrious personalities, including such well-known figures as Clark Gable, Lee Marvin and Elvis Presley. It was the bike of choice for Peter Fonda and Dennis Hopper on their long ride south in the 1969 counterculture film Easy Rider. More recently, Jackson Browne, Don Johnson, Jay Leno, Rourke, Arnold Schwarzenegger, Bruce Springsteen, Elizabeth Taylor and Tina Turner have become big Harley fans. Even Bill Clinton was pictured astride a Harley during a 1992 presidential-campaign stop in Milwaukee. One of the wealthiest men to own a hog was the late billionaire Malcolm Forbes, who didn't become a rider until he was 50 years old. He reportedly owned as many as 50 Harleys at one time. Forbes, a regular on the Harley rally circuit, was said to be just one of the boys when he was on his hog.

Though the Harley hog has often been the bike of choice for such bad-boy biker groups as the Hell's Angels, Teerlink bristles at the widespread notion that Harley-Davidson machines are only for the macho hard core. "The Harley customer cuts across social and economic lines," says Teerlink. "To say that Harley riders are this or that type of person is ridiculous. If you go to our rallies you see all sorts of people, and the common thread is that they all have a passion for Harley-Davidson."

In fact, according to company data, the Harley customer is male, married, in his mid-30s and has a household income well above the national average. More than 40 percent of Harley owners are college educated, and almost as many are occupied in white-collar jobs. To boost customer relations, Harley formed the company-sponsored Harley Owners Group (HOG for short) in 1983, which now has more than 250,000 members in 800 chapters worldwide. For its ninetieth anniversary, in 1993, the company threw a bash in Milwaukee that drew more than 75,000 bike owners, including riders from as far afield as New Zealand and Japan.

"If you want to put a bandanna on your head and ride a motorcycle on Sunday, then on Monday put on a three-piece suit and go to Wall Street, God bless you," adds Teerlink. "Everyone is welcome into the Harley family."

Catching Harley fever is something of an occupational hazard at the company itself, with nearly every member of the management team and a majority of the factory workers sooner or later getting the bug. Both Bleustein and company chairman Beals never even sat on a motorcycle before coming to Harley. Now each has a collection of hogs, and Beals, who is often pictured on a Road King, prefers full black leathers for bike duds. "They are the most protective garb for motorcycle riding," he says. One of the most spectacular transformations from mild-mannered executive to raving bike freak happened to William G. Davidson. When Davidson first came to Harley in 1969, he was the epitome of the conservative, clean-shaven, gray-suited businessman. But within months he metamorphosed into Willie G., the bearded, jeans-and-leather-vested soul of Harley-Davidson, an almost mythical figure in the motorcycling community.

"People come to work here and get swept up in the passion of motorcycling," says Lynn Sweet, who, after four years with the company, is about to purchase her first bike, a Sportster Deluxe. "Over 60 percent of Harley employees ride motorcycles, and most of them ride Harleys."

"More than half of my customers are Harley-Davidson employees," adds Mike Laugerman, whose York dealership is just down the street from the Harley plant. "These guys build bikes all day, and then after work and on the weekends, what do they want to do with their spare time? Ride hogs."

Teerlink, whose motorcycle experience was nonexistent before coming to the company and who now owns three bikes (the 1988 and 1993 Classic Electra Glide Anniversary Editions and an FLHT Electra Glide Standard), cites an obvious reason why being close to the source heightens the Harley mystique. "When you're involved in making a product of the quality and appeal of Harley-Davidson motorcycles, you naturally want to own one."

In recent years, Harley also has been very successful in marketing its lifestyle image. The company's 600-item Motorclothes and Collectibles catalogue features everything from top-of-the-line leather riding clothes and sexy lace bodysuits to jeans, T-shirts, watches, belt buckles, knives, cigarette lighters and other nonbiking goods. The look is tough, racy and cool. According to Teerlink, the catalogue fits into the Harley philosophy that "we are more than a machine, we're an experience."

Despite his upbeat attitude and general tone of optimism, Teerlink strikes a note of caution when speaking of the company's future. "I don't want to get into flag waving. Harley-Davidson is an American institution, and all of us here feel a responsibility to keep that institution alive. If there is one thing we have to fear now, it's arrogance. It would be very easy to rest on our laurels and take the position that we've got it made. But the law of nature operates in the marketplace, just as it does anywhere else, and the name of the game is survival of the fittest."

Maybe so, but from the outside looking in, Harley-Davidson certainly seems fit for the road. And whatever the future brings, it should be open highways for the hogs that made Milwaukee famous.


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