Harley Davidson Goes to China
August 17, 2009
MBA6001 – Business Analysis
The recreational vehicle industry can be challenging and fragile in difficult economic times, but Harley-Davidson has proven to be resilient under these circumstances. The decision to enter the market in a foreign country provides even bigger challenges for the company. Even though Chinese consumers purchase more motorcycles than any other country in the world, the biggest challenge for Harley is that China already has hundreds of motorcycle companies and the consumers of motorcycles in China make their purchases for utilitarian purposes. Therefore the majority of purchases are for small cycles, less than 250cc. Organizational Purpose
Harley-Davidson has the competitive advantage of its powerful brand image. According to the website, www.motorcyclecruiser.com, many motorcycle enthusiasts describe the pride of owning a Harley-Davidson motorcycle as owing an American Icon. The strategy to widen the brand image globally will expand the market share of the company. American businesses in China have contributed to the country’s huge economic development over the last thirty years. The Chinese economy has grown at an average annual rate of about 9%, compared to 2% to 3% for the leading developed economies like the United States (www.knowledgeatwharton.com). With China’s population of over one billion people, targeting the Chinese market is a way of increasing Harley-Davidson’s share of the recreational vehicle industry. Organizational Goals
Harley-Davidson is known around the world for its outstanding reputation and has a strong appeal to enthusiasts. However in China, where there are many motorcycle companies and the cycles are for utility purposes and not sport, Harley-Davidson would have to provide reasons for the consumer to choose its more expensive motorcycle over the utilitarian ones. Since Harley-Davidson’s motorcycles are...
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