Harley-Davidson strives for overseas appeal

The motorcycle company wants to take its brand to foreign markets. Executives are optimistic that sales will grow with disposable income in other countries.

By Jonathan Berr Jan 29, 2013 5:24PM
Credit: Saarthak Aurora/ Hindustan Times via Getty Images
Harley-Davidson (HD), which is as American as baseball and apple pie, is keen to expand outside the U.S. So far, its plans seem to be working.

The Milwaukee company saw 2012 retail sales gains of 39.2% in Latin America and 14.3% in Asia Pacific, far greater than the 6.2% increase seen in North America. Sales in Europe, the Middle East and Africa fell 3%.

The company vowed three years ago to open as many as 150 dealerships outside the U.S. and is on track to do just that, though overseas sales remain a small part of overall revenue. 
"And so we think that as disposable personal income in those regions continue to grow and we provide the right kind of products. . . there's upside there for us," CEO Keith Wandell said during Tuesday's earnings conference call. "Then there's other emerging markets, which we just sort of have begun to touch, so we think the future is very bright in terms of our international expansion."

Given the economic turmoil in Europe, the company no longer expects that international sales will exceed 40% of total retail sales by 2014. Nonetheless, they are still doing well. Fourth-quarter sales of new motorcycles rose by 7.5% worldwide from a year earlier. U.S. sales jumped 8.4% and international revenue rose 6.3%.

Shares of Harley-Davidson were up 2.6% in afternoon trading, after initially falling after the company reported disappointing earnings. (Click here for a complete report.) Investors, though, took a closer look at the numbers and found plenty to like.

As Reuters notes, the company expects profit margins to rise as Harley-Davidson benefits from an overhaul in its manufacturing processes to make it more efficient. The stock has gained more than 23% this year.

--Jonathan Berr does not own shares of the listed stocks. Follow him on Twitter @jdberr.

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Tags: Earnings
Jan 29, 2013 11:19PM

They should open a dealership in the Philippines, there is a big market here for real motorcycles (not the ones here they call MC's lol).  I would rather buy a new one here than ship mine from the US when I retire with my wife here in 2017!


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