2. Should Harley-Davidson alter its price, given that there are strong price pressures from rivals? Harley-Davidson’s mission statement is: ‘We fulfil dreams through the experience of motorcycling’.

History The Harley-Davidson Motorcycle Company (www.harleydavidson.

com) was founded in 1903. Harley-Davidson

(H-D) soon became the world’s leading manufacturer of motorcycles, based on a reputation of quality and reliability. After the Second World War and the demise of the American Indian motorcycle, Harley-Davidson became the sole US manufacturer of motorcycles. In 1969, Harley-Davidson was sold to American Machine and Foundry (AMF).

AMF almost tripled production to 75,000 units annually over a four-year period to meet the increase in demand.

Unfortunately, product quality deteriorated significantly as over half the motorcycles that came off the assembly line had parts missing and dealers had to repair them in order to make sales. Little money was invested in improving design or engineering. The motorcycles leaked oil, vibrated, and could not match the excellent performance of the Japanese products.