Harley-Davidson

In 1901, 20-year-old William S. Harley drew up plans for a small engine with a displacement of 7.07 cubic inches and four-inch flywheels designed for use in a regular pedal-bicycle frame. Over the next two years, he and his childhood friend Arthur Davidson worked on their motor-bicycle using the northside Milwaukee machine shop at the home of their friend Henry Melk. It was finished in 1903 with the help of Arthur's brother Walter Davidson. Upon testing their power-cycle, Harley and the Davidson brothers found it unable to climb the hills around Milwaukee without pedal assistance, and they wrote off their first motor-bicycle as a valuable learning experiment.The three began work on a new and improved machine with an engine of 24.74 cubic inches with 9.75 in flywheels weighing 28 lb . Its advanced loop-frame pattern was similar to the 1903 Milwaukee Merkel motorcycle designed by Joseph Merkel, later of Flying Merkel fame. The bigger engine and loop-frame design took it out of the motorized bicycle category and marked the path to future motorcycle designs. They also received help with their bigger engine from outboard motor pioneer Ole Evinrude, who was then building gas engines of his own design for automotive use on Milwaukee's Lake Street.

The prototype of the new loop-frame Harley-Davidson was assembled in a 10 ft × 15 ft shed in the Davidson family backyard. Most of the major parts, however, were made elsewhere, including some probably fabricated at the West Milwaukee railshops where oldest brother William A. Davidson was toolroom foreman. This prototype machine was functional by September 8, 1904, when it competed in a Milwaukee motorcycle race held at State Fair Park. Edward Hildebrand rode it and placed fourth in the race.In January 1905, the company placed small advertisements in the Automobile and Cycle Trade Journal offering bare Harley-Davidson engines to the do-it-yourself trade. By April, they were producing complete motorcycles on a very limited basis. That year, Harley-Davidson dealer Carl H. Lang of Chicago sold three bikes from the five built in the Davidson backyard shed. Years later, the company moved the original shed to the Juneau Avenue factory where it stood for many decades as a tribute.

In 1906, Harley and the Davidson brothers built their first factory on Chestnut Street , at the current location of Harley-Davidson's corporate headquarters. The first Juneau Avenue plant was a 40 ft × 60 ft single-story wooden structure. The company produced about 50 motorcycles that year.

In 1907, William S. Harley graduated from the University of Wisconsin–Madison with a degree in mechanical engineering. That year, they expanded the factory with a second floor and later with facings and additions of Milwaukee pale yellow brick. With the new facilities, production increased to 150 motorcycles in 1907. The company was officially incorporated that September. They also began selling their motorcycles to police departments around this time, a market that has been important to them ever since. In 1907, William A. Davidson quit his job as tool foreman for the Milwaukee Road railroad and joined the Motor Company.

Production in 1905 and 1906 were all single-cylinder models with 26.84-cubic-inch engines. In February 1907, they displayed a prototype model at the Chicago Automobile Show with a 45-degree V-Twin engine. Very few V-Twin models were built between 1907 and 1910. These first V-Twins displaced 53.68 cubic inches and produced about 7 horsepower . This gave about double the power of the first singles, and top speed was about 60 mph . Production jumped from 450 motorcycles in 1908 to 1,149 machines in 1909.

In 1911, the company introduced an improved V-Twin model with a displacement of 49.48 cubic inches and mechanically operated intake valves, as opposed to the "automatic" intake valves used on earlier V-Twins that opened by engine vacuum. It was smaller than earlier twins but gave better performance. After 1913, the majority of bikes produced by Harley-Davidson were V-Twin models.

In 1912, Harley-Davidson introduced their patented "Ful-Floteing Seat", which was suspended by a coil spring inside the seat tube. The spring tension could be adjusted to suit the rider's weight, and more than 3 inches of travel was available. Harley-Davidson used seats of this type until 1958.By 1913, the yellow brick factory had been demolished and a new five-story structure had been built on the site which took up two blocks along Juneau Avenue and around the corner on 38th Street. Despite the competition, Harley-Davidson was already pulling ahead of Indian and dominated motorcycle racing after 1914. Production that year swelled to 16,284 machines.

World War I

In 1917, the United States entered World War I and the military demanded motorcycles for the war effort. Harleys had already been used by the military in the Pancho Villa Expedition but World War I was the first time that it was adopted for military issue, first with the British Model H produced by Triumph Motorcycles Ltd in 1915. The U.S. military purchased over 20,000 motorcycles from Harley-Davidson.Harley-Davidson launched a line of bicycles in 1917 in hopes of recruiting more domestic customers for its motorcycles. Models included the traditional diamond frame men's bicycle, a step-through frame 3–18 "Ladies Standard", and a 5–17 "Boy Scout" for youth. The effort was discontinued in 1923 because of disappointing sales. The bicycles were built for Harley-Davidson in Dayton, Ohio by the Davis Machine Company from 1917 to 1921, when Davis stopped manufacturing bicycles.

1920s

By 1920 Harley-Davidson was the largest motorcycle manufacturer in the world, with 28,189 machines produced and dealers in 67 countries. In 1921, Otto Walker set a record on a Harley-Davidson as the first motorcycle to win a race at an average speed greater than 100 mph .Harley-Davidson put several improvements in place during the 1920s, such as a new 74 cubic inch V-Twin introduced in 1921, and the "teardrop" gas tank in 1925. They added a front brake in 1928, although only on the J/JD models. In the late summer of 1929, Harley-Davidson introduced its 45-cubic-inch flathead V-Twin to compete with the Indian 101 Scout and the Excelsior Super X. This was the "D" model produced from 1929 to 1931. Riders of Indian motorcycles derisively referred to it as the "three cylinder Harley" because the generator was upright and parallel to the front cylinder.

Great Depression

The Great Depression began a few months after the introduction of their 45 cu in model. Harley-Davidson's sales fell from 21,000 in 1929 to 3,703 in 1933. Despite this, Harley-Davidson unveiled a new lineup for 1934, which included a flathead engine and Art Deco styling.In order to survive the remainder of the Depression, the company manufactured industrial powerplants based on their motorcycle engines. They also designed and built a three-wheeled delivery vehicle called the Servi-Car, which remained in production until 1973.

Alfred Rich Child opened a production line in Japan in the mid-1930s with the 74 cu in VL. The Japanese license-holder, Sankyo Seiyaku Corporation, severed its business relations with Harley-Davidson in 1936 and continued manufacturing the VL under the Rikuo name.

An 80 cubic inches flathead engine was added to the line in 1935, by which time the single-cylinder motorcycles had been discontinued.In 1936, the 61E and 61EL models with the "Knucklehead" OHV engines were introduced. Valvetrain problems in early Knucklehead engines required a redesign halfway through its first year of production and retrofitting of the new valvetrain on earlier engines.By 1937, all Harley-Davidson flathead engines were equipped with dry-sump oil recirculation systems similar to the one introduced in the "Knucklehead" OHV engine. The revised 74 cubic inches V and VL models were renamed U and UL, the 80 cu in VH and VLH to be renamed UH and ULH, and the 45 cu in R to be renamed W.In 1941, the 74-cubic-inch "Knucklehead" was introduced as the F and the FL. The 80 cu in flathead UH and ULH models were discontinued after 1941, while the 74-cubic-inchU & UL flathead models were produced up to 1948.

World War II

One of only two American cycle manufacturers to survive the Great Depression, Harley-Davidson again produced large numbers of motorcycles for the US Army in World War II and resumed civilian production afterwards, producing a range of large V-twin motorcycles that were successful both on racetracks and for private buyers.

Harley-Davidson, on the eve of World War II, was already supplying the Army with a military-specific version of its 45 cubic inches WL line, called the WLA. The A in this case stood for "Army". Upon the outbreak of war, the company, along with most other manufacturing enterprises, shifted to war work. More than 90,000 military motorcycles, mostly WLAs and WLCs were produced, many to be provided to allies. Harley-Davidson received two Army-Navy "E" Awards, one in 1943 and the other in 1945, which were awarded for Excellence in Production.

Shipments to the Soviet Union under the Lend-Lease program numbered at least 30,000. The WLAs produced during all four years of war production generally have 1942 serial numbers. Production of the WLA stopped at the end of World War II, but was resumed from 1950 to 1952 for use in the Korean War.

The U.S. Army also asked Harley-Davidson to produce a new motorcycle with many of the features of BMW's side-valve and shaft-driven R71. Harley-Davidson largely copied the BMW engine and drive train and produced the shaft-driven 750 cc 1942 Harley-Davidson XA. This shared no dimensions, no parts or no design concepts with any prior Harley-Davidson engine. Due to the superior cooling of the flat-twin engine with the cylinders across the frame, Harley's XA cylinder heads ran 100 °F cooler than its V-twins. The XA never entered full production: the motorcycle by that time had been eclipsed by the Jeep as the Army's general-purpose vehicle, and the WLA – already in production – was sufficient for its limited police, escort, and courier roles. Only 1,000 were made and the XA never went into full production. It remains the only shaft-driven Harley-Davidson ever made.

Small: Hummer, Sportcycle and Aermacchi

As part of war reparations, Harley-Davidson acquired the design of a small German motorcycle, the DKW RT 125, which they adapted, manufactured, and sold from 1948 to 1966. Various models were made, including the Hummer from 1955 to 1959, but they are all colloquially referred to as "Hummers" at present. BSA in the United Kingdom took the same design as the foundation of their BSA Bantam.

In 1960, Harley-Davidson consolidated the Model 165 and Hummer lines into the Super-10, introduced the Topper scooter, and bought fifty percent of Aermacchi's motorcycle division. Importation of Aermacchi's 250 cc horizontal single began the following year. The bike bore Harley-Davidson badges and was marketed as the Harley-Davidson Sprint. The engine of the Sprint was increased to 350 cc in 1969 and would remain that size until 1974, when the four-stroke Sprint was discontinued.After the Pacer and Scat models were discontinued at the end of 1965, the Bobcat became the last of Harley-Davidson's American-made two-stroke motorcycles. The Bobcat was manufactured only in the 1966 model year.Harley-Davidson replaced their American-made lightweight two-stroke motorcycles with the Italian Aermacchi-built two-stroke powered M-65, M-65S, and Rapido. The M-65 had a semi-step-through frame and tank. The M-65S was a M-65 with a larger tank that eliminated the step-through feature. The Rapido was a larger bike with a 125 cc engine. The Aermacchi-built Harley-Davidsons became entirely two-stroke powered when the 250 cc two-stroke SS-250 replaced the four-stroke 350 cc Sprint in 1974.Harley-Davidson purchased full control of Aermacchi's motorcycle production in 1974 and continued making two-stroke motorcycles there until 1978, when they sold the facility to Cagiva, owned by the Castiglioni family.

Tarnished reputation

In 1952, following their application to the U.S. Tariff Commission for a 40 percent tax on imported motorcycles, Harley-Davidson was charged with restrictive practices.

In 1969, American Machine and Foundry bought the company, streamlined production, and slashed the workforce. This tactic resulted in a labor strike and cost-cutting produced lower-quality bikes. Simultaneously, the Japanese "big four" manufacturers revolutionized the North American market by introducing what the motoring press would call the Universal Japanese Motorcycle. In comparison, Harley-Davidson's bikes were expensive and inferior in performance, handling, and quality. Sales and quality declined, and the company almost went bankrupt. The "Harley-Davidson" name was mocked as "Hardly Ableson", "Hardly Driveable", and "Hogly Ferguson",

and the nickname "Hog" became pejorative.In 1977, following the successful manufacture of the Liberty Edition to commemorate America's bicentennial in 1976, Harley-Davidson produced what has become one of its most controversial models, the Harley-Davidson Confederate Edition. The bike was essentially a stock Harley-Davidson with Confederate-specific paint and details.

Restructuring and revival

In 1981, AMF sold the company to a group of 13 investors led by Vaughn Beals and Willie G. Davidson for $80 million. The new management team improved product quality, introduced new technologies, and adopted just-in-time inventory management. These operational and product improvements were matched with a strategy of seeking tariff protection for large-displacement motorcycles in the face of intense competition with Japanese manufacturers. These protections were granted by the Reagan administration in 1983, giving Harley-Davidson time to implement their new strategies.Revising stagnated product designs was a crucial centerpiece of Harley-Davidson's turnaround strategy. Rather than trying to mimic popular Japanese designs, the new management deliberately exploited the "retro" appeal of Harley motorcycles, building machines that deliberately adopted the look and feel of their earlier bikes and the subsequent customizations of owners of that era. Many components such as brakes, forks, shocks, carburetors, electrics and wheels were outsourced from foreign manufacturers and quality increased, technical improvements were made, and buyers slowly returned.

Harley-Davidson bought the "Sub Shock" cantilever-swingarm rear suspension design from Missouri engineer Bill Davis and developed it into its Softail series of motorcycles, introduced in 1984 with the FXST Softail.In response to possible motorcycle market loss due to the aging of baby-boomers, Harley-Davidson bought luxury motorhome manufacturer Holiday Rambler in 1986. In 1996, the company sold Holiday Rambler to the Monaco Coach Corporation.The "Sturgis" model, boasting a dual belt-drive, was introduced initially in 1980 and was made for three years. This bike was then brought back as a commemorative model in 1991.

Fat Boy, Dyna, and Harley-Davidson museum

By 1990, with the introduction of the "Fat Boy", Harley-Davidson once again became the sales leader in the heavyweight market. At the time of the Fat Boy model introduction, a false etymology spread that "Fat Boy" was a combination of the names of the atomic bombs Fat Man and Little Boy. This has been debunked, as the name "Fat Boy" actually comes from the observation that the motorcycle is somewhat wider than other bikes when viewed head-on.1993 and 1994 saw the replacement of FXR models with the Dyna , which became the sole rubber mount FX Big Twin frame in 1994. The FXR was revived briefly from 1999 to 2000 for special limited editions .Harley-Davidson celebrated their 100th anniversary on September 1, 2003 with a large event and concert featuring performances from Elton John, The Doobie Brothers, Kid Rock, and Tim McGraw.Construction started on the $75 million, 130,000 square-foot Harley-Davidson Museum in the Menomonee Valley of Milwaukee, Wisconsin on June 1, 2006. It opened in 2008 and houses the company's vast collection of historic motorcycles and corporate archives, along with a restaurant, café and meeting space.

Overseas operations

Established in 1918, the oldest continuously operating Harley-Davidson dealership outside of the United States is in Australia. Sales in Japan started in 1912 then in 1929, Harley-Davidsons were produced in Japan under license to the company Rikuo under the name of Harley-Davidson and using the company's tooling, and later under the name Rikuo. Production continued until 1958.In 1998, the first Harley-Davidson factory outside the US opened in Manaus, Brazil, taking advantage of the free economic zone there. The location was positioned to sell motorcycles in the southern hemisphere market.In August 2009, Harley-Davidson launched Harley-Davidson India and started selling motorcycles there in 2010. The company established the subsidiary in Gurgaon, near Delhi, in 2011 and created an Indian dealer network. On September 24, 2020, Harley Davidson announced that it would discontinue its sales and manufacturing operations in India due to weak demand and sales. The move involves $75 million in restructuring costs, 70 layoffs and the closure of its Bawal plant in northern India.

Buell Motorcycle Company

Harley-Davidson's association with sportbike manufacturer Buell Motorcycle Company began in 1987 when they supplied Buell with fifty surplus XR1000 engines. Buell continued to buy engines from Harley-Davidson until 1993, when Harley-Davidson bought 49 percent of the Buell Motorcycle Company. Harley-Davidson increased its share in Buell to ninety-eight percent in 1998, and to complete ownership in 2003.In an attempt to attract newcomers to motorcycling in general and to Harley-Davidson in particular, Buell developed a low-cost, low-maintenance motorcycle. The resulting single-cylinder Buell Blast was introduced in 2000, and was made through 2009, which, according to Buell, was to be the final year of production. The Buell Blast was the training vehicle for the Harley-Davidson Rider's Edge New Rider Course from 2000 until May 2014, when the company re-branded the training academy and started using the Harley-Davidson Street 500 motorcycles. In those 14 years, more than 350,000 participants in the course learned to ride on the Buell Blast.On October 15, 2009, Harley-Davidson Inc. issued an official statement that it would be discontinuing the Buell line and ceasing production immediately. The stated reason was to focus on the Harley-Davidson brand. The company refused to consider selling Buell. Founder Erik Buell subsequently established Erik Buell Racing and continued to manufacture and develop the company's 1125RR racing motorcycle.

Claims of stock price manipulation

During its period of peak demand, during the late 1990s and early first decade of the 21st century, Harley-Davidson embarked on a program of expanding the number of dealerships throughout the country. At the same time, its current dealers typically had waiting lists that extended up to a year for some of the most popular models. Harley-Davidson, like the auto manufacturers, records a sale not when a consumer buys their product, but rather when it is delivered to a dealer. Therefore, it is possible for the manufacturer to inflate sales numbers by requiring dealers to accept more inventory than desired in a practice called channel stuffing. When demand softened following the unique 2003 model year, this news led to a dramatic decline in the stock price. In April 2004 alone, the price of HOG shares dropped from more than $60 to less than $40. Immediately prior to this decline, retiring CEO Jeffrey Bleustein profited $42 million on the exercise of employee stock options. Harley-Davidson was named as a defendant in numerous class action suits filed by investors who claimed they were intentionally defrauded by Harley-Davidson's management and directors. By January 2007, the price of Harley-Davidson shares reached $70.

Problems with Police Touring models

Starting around 2000, several police departments started reporting problems with high-speed instability on the Harley-Davidson Touring motorcycles. A Raleigh, North Carolina police officer, Charles Paul, was killed when his 2002 police touring motorcycle crashed after reportedly experiencing a high-speed wobble. The California Highway Patrol conducted testing of the Police Touring motorcycles in 2006. The CHP test riders reported experiencing wobble or weave instability while operating the motorcycles on the test track.

2007 strike

On February 2, 2007, upon the expiration of their union contract, about 2,700 employees at Harley-Davidson Inc.'s largest manufacturing plant in York, Pennsylvania, went on strike after failing to agree on wages and health benefits. During the pendency of the strike, the company refused to pay for any portion of the striking employees' health care.The day before the strike, after the union voted against the proposed contract and to authorize the strike, the company shut down all production at the plant. The York facility employs more than 3,200 workers, both union and non-union.Harley-Davidson announced on February 16, 2007, that it had reached a labor agreement with union workers at its largest manufacturing plant, a breakthrough in the two-week-old strike. The strike disrupted Harley-Davidson's national production and was felt in Wisconsin, where 440 employees were laid off, and many Harley suppliers also laid off workers because of the strike.

MV Agusta Group

On July 11, 2008, Harley-Davidson announced they had signed a definitive agreement to acquire the MV Agusta Group for US$109 million . MV Agusta Group contains two lines of motorcycles: the high-performance MV Agusta brand and the lightweight Cagiva brand. The acquisition was completed on August 8.On October 15, 2009, Harley-Davidson announced that it would divest its interest in MV Agusta. Harley-Davidson Inc. sold Italian motorcycle maker MV Agusta to Claudio Castiglioni – a member of the family that had purchased Aermacchi from H-D in 1978 – for a reported 3 euros, ending the transaction in the first week of August 2010. Castiglioni was MV Agusta's former owner, and had been MV Agusta's chairman since Harley-Davidson bought it in 2008. As part of the deal, Harley-Davidson put $26M into MV Agusta's accounts, essentially giving Castiglioni $26M to take the brand.

Financial crisis

According to Interbrand, the value of the Harley-Davidson brand fell by 43 percent to $4.34 billion in 2009. The fall in value is believed to be connected to the 66 percent drop in the company profits in two-quarters of the previous year. On April 29, 2010, Harley-Davidson stated that they must cut $54 million in manufacturing costs from its production facilities in Wisconsin, and that they would explore alternative U.S. sites to accomplish this. The announcement came in the wake of a massive company-wide restructuring, which began in early 2009 and involved the closing of two factories, one distribution center, and the planned elimination of nearly 25 percent of its total workforce . The company announced on September 14, 2010, that it would remain in Wisconsin.