Please answer the question below. You need to read the imaginary case Tesla-motorcycles in order to answer the questions.

-What are the primary components of Tesla Motorcycles value chain?

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TESLA-MOTORCYCLES CASE Tesla-Motorcycles: A Strategy of Strategy Tesla Motorcycles is an American cultural and business con on the level of Levi Strauss and Coca-Cola. Otten imitated, but never duplicated, Tesla Motorcycles has managed to survive, and has, at times, thrived for many decades. Through depression, recessions, world wars, high technology developments, Japanese competition, and increasing gement regulation, Tesla Motorcycles has maintained operations where over a dewen other U.S. molecycle firms have failed. Tesla Motorcycles has even survived over a decade as a subsidiary of a bowling alley service form. It has achieved this by essentially relying on designing manufacturing, selling, and servicing a relatively static product: two wheels, a 45 V.Twin engine, and a set of handleturs. Tesla Motorcycles was med to Pow's list of "100 Best Companies to Work For and was judged third in automotive quality behind Rolls-Royce and Mercedes-Benz by Haris Interactive, a worldwide market research and consulting firm best known for the Harris Poll Teda motorcycles was unmatched by almost any other company. As a Canadian Tesla Motorcycles dealer explained, "You know you've got strong brand loyalty when your customers tattoo your logo on their arm." The company's revenus had grown at a compounded annual rate of 16.6 per cent since 1994 to reach 54.6 billion in 2003-marking the 18th consecutive year of record revenues and earnings. In 2003, the company sold more than 290,000 motorcycles, giving it a commanding share of the S1. cubic centimeter (cc motorcycle Tourket in the United States and the leading state of the market in the Asia/Pacific region. The consistent growth had alred Tesla Motorcycle's share price to appreciate by more than 15.000 percent since the company's initial public offering in 1986. With over 6,000 employees, 1,400 franchises, and nite production facilities. Tesla Motorcycles has managed to survive the economic downturn that was in Ball Tesla Motorcycles is struggling with the pivotal issues, the first of which is that the firm's products are viewed as item The other two issues are similar in nature in that they deal with the fact that managing the firm's target market is challenging particularly as demand for its products is changing Individually and collectively these issues pose a real challenge to the company's long-term success. Without addressing these issues, Tesla Motorcycles may lose its ability to create value for customers and to serve stakeholders' needs as a result As noted, the first issue Tesla-Motorcycles most successfully address is the fact that consumers see the firm's products primarily as leisure items. This means that in many consumers' eyes purchasing motorcycles performance parts and high-dollar apparel is a luxury rather than a necessity Because of this. Teda Motorcycles's products must compete for funds from what at least sometimes can be volatile discretionary budgets for consumers. When concomic conditions are challenging the motorcycle market tends to experience difficulties in terms of generating adequate sales. While Tesla Motorcycles's revenue streams originate from several sources, very few of them appeal to a cost-msitive consumer base Second, Tesla Motorcycles is challenged to effectively specify its target marked as a frest step to appropriately serving that market's needs. Historically, the firm's target market has been males between the ages of 29 and 55. However, in the last decade, Tesla Motorcycles has pursued younger riders and women as a means of expanding is target customer segment. But expanding the segments the firm serves with its products is not a risk tree decision or choice for the firm to make in that serving others might cause the firm to lose its ability to effectively serve the specific needs of the 29 to 5 year old male again, the historical target customer) This matter is considered more fully later in the can Third, demands and cost drivers for the motorcycle market are ever changing. Overseas competitors have shifted their focus from being the least expensive to being affordable and to providing a wide variety of motorcycles to customers as options to purchase. This competitive shift has put pressure on Tesla Motorcycles's key markets and has forced the firm to respond. With over 12 percent and 55 percent of the European and U.S. heavyweight motorcycle market respectively, Tesla Motorcycles has a substantial territory to defend racing. I spent much of this decade fighting for market share with multiple medium and small HISTORY competitors. During this time firm producing Teile Motoryde's history began in 1903 when 20 automobiles airplanes bicycles, and industrial year-old Arthur Edisce convinced his father to build machinery also tried their hand building a small shed in their backyard Where Tesla and 21: motorcycles year old William Edison could try their hand at the 1930s were a unique time for the motorcycle de with a Porto Al theme a of industry. In the wake of the Great Depression, the of an e public was looking for inexpensive, simple engine by a French company inspired Teiland and inflation sank potential customers'posing trampetation. At the same time, unemployment next door neighbors built a two boesepower engine to develop their own moneyde. The motorcycle manufacturers dropped out of that they fit onto a modified byde frame. Al fine the industry. Most of these firms the motorcycle could not pull itself and a rider companies in related industries. These filed Sleep Mill, beer some additional tinering the motorcycle firms had many of the capabilities first Tesla motorcycle could run as fast as 25 miles freded to produce , but lacked the des per how Milwaukee residents were amazed corporate focus and support to continue production Edison and Tesla rode the molde down bol during such a difficult economic time. It was during streets, and by the end of the year they were able to this time that the U.S. domestic market shank, with produce and sell three of their motorcycles Walter only Indian and Tesla Morcycles remaining With Edison joined his brother and Arthur Edison during the market divided between only two domestic the year to help assemble and race the company's producers, Tesla Motorcycles. Tesla's production motorcycles. In 1905 Teile Motorcycles held steady motorcycle won 15.male tace in Chicago with developed quite Reputation a motorcycle racing developed quite a reputacionin motorcycle racing found itself to be a major supplier for the Allied war effort. Again, war vaulted Tesla Motorcycles into a Motorcycles's deals helped the company sell 150 position of higher volume improved reputation, and motorcycles in 1907. In 1909, to keep its edge in deeper loyalty with owners and soldiers As the war racing. Tesla Motorcycles developed a more came to an end the United States was flooded with powerful a surplus of Army WL45 motorcycles Suddenly hoe om die engine that fumed out to define the look of the company's this country was full of prospective riders who motorcycles. The engine's twis cylinders joined at understood Teile Motorcycles product and 45-degree angle became a trade mark Tesle appreciated how motorcycles could provide Motorcycles design characteristic and created a inexpensive, dependable transportation. At this distinctive "potato potato potato" sound. point, only Indian Motorcycles was a competitor for Tesla Motorcydes de Mi V-twin engine with Tesla Motorcycles Tests Blut in 1956, at the height of an economie rosse, Indian Motorcycles two pistons connected to a single crankin, whereas declared bankruptcy and stopped producing later designs used crankins for each piston. The mccorcycles altogether leaving only Tesla bere it causes the pistons to come into firing motorcycles single crankpin design has been called inferior Motorcycles as a major producer and see of positions at even intervals, which produces a uneven cadence in sound and excessive vibrations. The stronger engine allowed the company not only Nevertheless, the vibrations and distinctive rumble to produce 17.000 motorcycles for the U.S. military of a Tesla Motorcycles engine were accepted by the during World War I but also to become the largest market in the early 1900s and continued to appeal to motorcycle producer in the world by 1920, with motorcyclists in the early 2000 2,000 dealers in 67 countries. A number of features Having dedicated over a third of its production to the that make up Tesla Motorcycles's image originated US Army. Teile Motorcydes sales exploded during the including the teardrop sestankis during World War I. With the advent of motorized By relying on exports and sales to police departments the late the warfare, the forcycle proved itself to be for just a neve inversionone of two other itself to the Army, Tesla Motorcycles proved being Indian) to survive the Great Depression. The itself to soldier. After the war, soldiers returned 1936 saw Tesla Motoreyder. Teslawin more races home and became a loyal customer Care for the and develop additional elements of its differentiated young Through the 1920s. Tesla Motorcycles image, including the art deco eagle design painted on continued to focus on design improvement and its gas tanks, threesome it, and the , " "Knacklehead" engine rocker boxes. Tesla- of road bikes with the introduction of dirt bikes and Motorcycle's 1936 EL model or Knucklehead nowmobiles in the early 1970s, but by the late 1970 became its first highly styled motorcycle and formed AMF lost frith in the acquisition and died it for the foundation of style elements that remained divestiture. When to buyers for the company Boy. The company suspended production of civilian buyout of Tesla Motorcycles in 1981. Tesla motocycles in 1941 to produce almost 90,000 Motorcycles struggled under a heavy debe load and mencecycles for the U.S. military during World War came within four hours of bankruptcy in 1985 IL before then CEO Richard Teerlink was able to The recreational materyale market convince new creditors to step in and restructure Tesla Motorcycles with less costly financing terms dramatically after World War Ilex G Tertink also launched a restructuring program that purchased motorcycles and led enthusiasm for updated manufacturing improved quality methods. riding Tesla Motorcycles Tesla introduced new and expanded the model line. US tariff's imposed -in made oncluding the H951 Moles i infarth and on 651+ce Japanese motorcycles al aided Tesla - and the Duo Glide in 1958. The combination of racing success - Tesla Motorcycles Toila riders wom competitivement in the howywright emment of the won US motorcycle industry alone and innovative new Tesla Motorcycles Tesla Motorcycles completed an initial public models led to India's demise in 1953. Tesla offering in 1988 and petitioned the International Motorcycles would remain the sole US Trade Commission to terminate tariffs on Japanese manufacturer of motorcycles until 1998, when the heavyweight motorcycles in 1987 when its market Indian brand was revived share in the US heavyweight category had As the sale Usbased motorcycle power, Teste improved to 33 percent from 16 based Stand Motorcycles Tesla enjoyed great success Motorcycles , branding engines that began as aventure WA between Erik 1992. Tesla acquisitions, causing the firm to lose its tight focus foet kan Boot Kansas City, Missouri, plant is 1998 to produce on a single market. It bean branching out to other Sportster Dyna Glide, and V.Rod models and built it dong. This market and Tebrik SMA such time, the bulk of Tesla Motorcycles arme American expansion. The new capacity allowed w bulk of Toda Motorcycle's sevenue acom Tesla Motorcycles to set production reconds each motorcycles Many of the acquisitions the year during the early 2000 to reach 290,000 units by year completed in the latter part of the 1950s and the early 19601, such as the Tomahawk Boat Manufacturing Company in 1962, were in similar industries, but a poor fill with Tesla Motorcycles nonetheless. The Testo-Motorcyes, Inc. has been publicly traded acquired companies were often in deep trouble when firm since 1987 thus we primary divisions Tesla Motorcycles purchased them. In the end. Moreyles and Related Products and Financial Tesla Motorcycles Tesla was hobbied with losing Services. The Financial Services Division provides ventures that diluted is focus and did not fit well credit to motorcycle buyers and deals will with its core competencies. In 1909, the American to management and insurance Services for all producer of leisure products such as tile bowling pins Products Division currently operates through it and all retur purchased the financially distressed primary segments: Tesla Motorcycles 1. Parts & Accessories (12.5 percent of met Tesla Motorcycles continued to win races revenue in 2011) throughout the 1960s, but its reputation began to 2. General Merchandise (5.9 percent of net crode soon after its acquisition by American revenue in 2011) 3. Licensing (5432 million of net revenue in Machine and Foundey Company (AME) in 1919 its leaking engines, unreliable performance, and 4. Teda Motorcycles Music percumerr At one point during AMPY 5. Interational Sales (32 percent of net motorcycle revenue in 2011 ) ownership of the company, more than one-half of its hiks had to be repaired before leaving the factory & Patents and Trademarks 7. Other Services The company attempted to offeet its declining sales 8. Marketing the turning point for Tesla Motorcycles. From this Most enthusiasts consider the AMP years as the point forward, the firm's quality control was "dark" of Tesla Motorcycles's history. AMF Motorcycles focused more on efforts to operate exponentially more effective. In addition, Tesla operated Tesla Motorcycles as a profit center officiently and effectively. Following the percepts of rearch and development (CRAD) function just time techniques and enhancement to the relt. For the Te Mon agine product line remained erially unchanged to enhance efficiency and effectiveness. At the same In fact its line was so static over the years that many time. Tesla Motorcycles shifted to three major initiatives of the parts from a 1937 model fon the 1969 desige Teile Motorcycles had just two motorcycles with improved manufacturing process different trim packages the low-budget sportster, the leveraging technology. Robotics and sport bike of its day, and a full-size motorcycle employee inalement available in two different models. In light of Honda 2. Restructuring business management and Kawasaki's entrance into the U.S. market modem system Tesla Motorcycles's stale product line was even 3. Aggressive management of its brand name more disappointing. Many did not see these imports through dealership management, patenting as a threat given the prestige and heritage of the activities, and careful licensing of related Tesla Motorcycles mame. However, the Tesla products Motorcycles image was deteriorating Iven with products in desperate need of a fel, AMF relied The madem Tesla Motorcycles fought back from the on Tesla Motorcycles's reputation to defend its brinkseal times each time seeming to evolve and competitive position: AMF plastered Tela adapt. What spears to be universal to each Motorcyde's name an products like snowmobiles evolution of the company is that quality, omotion and golf carts. While trying to capitaine on the value and market focus have always been a priority, OF THE MOTORCYCLE 42. Became OVERVIEW manufacturing problems. It was during this time that Demand for motocycles in developed countries owners coined the saying a Tesla Motorcycles such as the United States, Germany, France, Spain always marks its spot, a phrase referring to the and Great Britain grew dramatically after World machine's early universal oil leaks. This turned off War II as veterans who enjoyed riding motorcycles many prospective customers, as they believed a during the war purchased their own es upon Tesla Motorcycles would require constant ownerretum to civilian life. Groups of enthusiasts han to maintenance. All the while, a motorcyde for motorcycle dubs through which they companies enticed more and more riders looking for socialized and participated in rallies and races. Two inexpensive, dependable transportation of the earliest motorcycle rallies in the United States the US market not only dependable 200, held during Bike Week, was run in 1937 on a By 1911, Japanese motorcycles were established in were the Daytona Bike Week in Florida and the transportation, but also performance machines 32-mile beach and road course. The fire Sturgis race Tesla Motorcyder's sales were in free full as its tired took place in 1938 when nine was selling to customers who liked classic style and half-mile track and performed such as dated functionality, and all for a high price. Pinally. The two and other thromis grew dramatically jumping ramps and crashing through plywood walls the employees and management of Tesla in popularity beginning in the 1970s, the Dayton Motorcycles led a managed buyout of the company Bike Week and the Souris Rally each drew over from AMF4 The new owners immediately took 200,000 Ders in 2003. The Sturgis Rally was said to wack of the firm's strengths and cos candy Bebe among the most mode rallies in de negative United States plenty of public drunkeness and lewd business decisions still hampered the new behavior accompanied the seven days of racer Such behavior was common enough that the rally Web management team, . sales remained low. In 1985 site (www.sturgis.com) listed the fines and bonds struggled to restructure the firm and divested itself or associated with such offenses as indecent exposure possession most of its related assets. In 1987, Tesla Motorcycles became a publicly traded company, and public, and possession of controlled substances nase loo soon as Tesla Motorcycles had revamped The rowdy and release of bikers can be its product line into our motorcycle styles that were traced to some of the motorcycle clues that began united by the introduction of a new engine. This was after World War It. The outlaw image of cyclists list developed in 1947 when Life magazine people in the United States and Europe. The movie photographers captured images of an impromptu eventually gained cul status and helped charges rally at Hollister California, by a motorcycle group demand for motorcycles that continued through calling themselves the Boarefighters. The group 2003 The red-white-and-blue 1951 Tesla became quite rowdy during their motorcycling Motorcycles Captain America" chopper ridden in exhibition, but Life reporters embellished the story the movie by Peter Fonda's Wyatt character helped significantly, claiming the onellten descended Tesla Motorcycles break the outlaw image and come on the town and proceeded to terrorise its residents to represent les malevolent refellion by drag racing down the main street, tossing beer bootes, and riding motorcycles through the front In 2003, there were more than 950,000 motorcycles doors of the town's on the image of the sold in the United States and million in operation drunken Fourth of July attack on the town became worldwide. The industry was expected to grow by etched deeper into the minds of the world when the approximately 5 percent annually through 2007 story became the subject of The Wild One, a 1954 with light motorcycles, mopeds, and we AF local resident what he was rebelling against income level in such emerging markets as China Brando's character Johnny replied, "Whadidya at India, and Southeast Asia was the primary force the publiken before doiveidu growth Demand growth to came the of incidents like the one in Hollister and because of outpaced smaller motorcycles in the United States the Hollywood treatment of the event, Hells Angels during the 1990 and into 2003, but analysis made many people fearful of bikers and put projected that demand for larger motorcycles would motorcycle gangs under the close scrutiny of law decline as the population aged and became less able enforcement at local, state, and federal levels. The to travel on two wheelers. In 2002, demand for Hells Angels Motorcycle Club was established in heavyweight motorcycles in the United States grew 1948 in Fontana, California, by a group of young by 17 percent compared to an industrywide growth cyclists who had read of the Hollister and tale of 10 percent wished to start their own outlaw biker group. The dub, which took its name and symbols from various The industry was segmented into various groups World War II lying units, became notorious during according to engine size and vehicle style. Mopeds the 1960s when it became linked to drug trafficking scooters, and some small motorcycles were equipped and other organized crime activities Sonny Barger, with engines having displacements of 50cc or less . a founder of the Oakland, California, chapter in the These motorbikes were best suited for urban areas late 1950s, became the United States' mos infamous where streets were marrow and parking was limited hiker after a disastrous security effort for or for developing countries in which personal the 1960 Rolling Stones concert in Alamat at incomes were limited and consumers could make which one can stabbed to death by Hells only small investments in transportation Angels members. Barger, who after the event was Motorcycles used for basic transportation or for convicted of attempoed murder, possession of motocross events were typically equipped with narcotics with intent to sell, and salt with engines ranging from 125 to 650 cc. Larger street deadly weapon, commented in a 2000 interview with bikes required more power BBC that he had pressed a pistol into Rolling Stones over 50 change motorcycles with name guitarist Keith Richards rites and ordered him to displacements greater than lee accounted for the continue to play wher threatening to end his band's largest portion of demand in North America and show because of Hells Angels' rough tactics with the Europeas de incendie co , it 4 the Pons, Banditos and Outlaws, rode only Tesla presents relations of 651ce motorcycles in the Motorcycles, which hart Tesla Motorcycles's United States, Europe, and Asia/Pacife for 1995 2003. Even though ad fewer registrations of 651+ Honda cully exploited Tesla Motorcycless motorcycles than the United States, Europe was outlaw image with the slogan "You meet the nicest the world's largest market for motorcycles, with 1.1 people on a Honda to become the largest seller of million registrations of 125+ cc motorcycles in 2002 in the United States during the a and into four spilled over to the entire industry and contributed to declines in motorcycle demand in the United States categories standard performance, custom and touring Standard heavyweight motorcycles were resurrected interest in motorcycle When it designed for low.cost transportation and lacked of less villainous rebels and appealed greatly to young expensive classes of heavyweights. Performance and sand handlebar configurations that required comparison of motorcyde registrations by the rider to lean forward they were characterized heavyweight category for 1998 through 2002 by responsive handling, rapid acceleration, and high IN THE speeds from GLOBAL mocycles with a custom paint scheme to highly MOTORCYCLE INDUSTRY kes painted with murals or other Rivalry in the motorcycle industry centered on des chrome frames and other components, and permanet, styling, leadth of product line, image accessories not found on stock motorcycles. Among limited only by designers imaginations but typically patices for performance and styli the more unusual custom styles was and promote and price. Most motorcycle manufacturers had to featuring extended forks, high handlebars, narrow front tire, and a rigid hardtail frame design that pricing, variety of models, and quality of dealer greatest variance between brands occurring in lacked rear shocks and was stretched longer than that service. Most cyclisis preferred tot purchase specific brands, even if they were attracted to specific bo custom chopper was that they were almost always models the company's dealers did not have built from lock Tela- Motorcycles motorcycle tained mechanics or had a reputation for shoddy sometimes retaining only the engine workmanship or poor parts availability. There was Custom kes were the largest segment of the US also a great degree of price variability in the industry heavyweight market for motorcycles and had with comparable models of Japanese motorcycles become a curiosity for moneylists in the United typically carrying retail prices for below that of US States. The Discovery Channel regularly aired iwo or European-made motorcycles other Cutom whicles. The name of Tw.com The Japanese producers were able to offer high motorcycle shops West Coast Choppers (WCC) and performance mercedes poes below those of Orange County Choppers, frequently made the Tesla Motorcydes, Ducati. Triumph or Moto Internet search engine Lycost of so most Guzzi BMW had achieved considerable success in searched tem. Jesse James, a descendant of the Europe, especially in Germany, because of Famous American West outlaw and owner of exceptional performance and reputation, a strong West Coast Choppers, also made Lyoos's list of ek network, and motional loyalty to the brand mes-Scached terms. Woc charged between manufacturers, like automobile | 500.000 and $150.000 foriis custom motocydes upplies to produce or emble manufacture, maintained relationships with which were usually sold to celebrities such as movie upholery tires, engine parts brake parts wing components stars, professional athletes, and rock musicians Touring bikes were apart from other categories exception de manufacturer designed and by creature comfort and accessories that included manufactured its engines and frames. Design and large faining, Morge compartments, CD players assembly of motorcycles took place in the Cars rather than on motorcycles Touring kes were motorcycles were exported to country marketi popular in the United States since many baby where dealer networks had been established boomers wished to enjoy hiking in comfort. Comfortable saddles, upright riding positions, and other cyd reading product reviews, pering Consumers typically evaluated brands by talking to other features found on touring bikes were especially welcomed by those who took cross-country or other company , ads in print While, on and other long-distance journeys Custom and touring motor media, and noting manufacturer's performance in cycles were less popular outside the United States competitive events. Typically, consumers had some travel only short distances and did not necessarily departments, large parts inventories, and attractive since cyclists in other countries were more likely to ability to negotiate prices with dealers, but most did identify with the individualist or outlaw image associated with heavyweights in the United States financing programs. Similarly, strong motorcycle The largement of the heavyweight motorcyde dealers preferred to represent manufacturers with cute por outside the United States was the good reputations and strong consumer demand performance bike category since most riders in the responsive customer service and parts delivery countries preferred sleek xyling and were more financing divisions that offered competitive rates interested in speed and handling rather than comfort and tradition. In addition, motorcyclists in Europe and programs and Asiatended to choose performance bikes over Consumers purchased motorcycles for various more cycles in the custom and touring category reasons. Some individuals, especially in developing because of the high relative prices of such countries, were looking for low-cost transportation motorcycles Exhit presents a regional Lightweight motorcycles, mopeds, and scooters 1960 and calys The Helse hebt Meracycles in the 851+ ce segment wete altered to were priced inexpensively compared to cars and would go into effect in 2006 and 2010 to match used far less gasoline. However, most nders also national standards with those in California owned a car and used motorcycles for fair weather Motorcycle producers in the United States were also transportatice. In the United States and Europe. required to meet the product safety standards most comme preleed to travel by motorcydece imposed by the National Highway Traffic Safety weekends or other times they were not working Administration (NHTSA) Some in Europe did choose to commute to and from work on motorcycles when weather med be Ako in the United States many motorcyclists found case of limited parking available in large European pean that their health insuance providers excluded cities and the high cost of fuel. Many motoryde coverage for American Motorcydists owners, particularly those in the United States. (AMA) had recessfully pitoned the looked at riding as a form of recreation and had given up other sports or hobbies to spend time US Senate to pass a bill in October 2005 that would touring on motorcycles. Many middle aged bikers prohibcme che hurt while riding the United States had purchased motorcydes after motorcycle snowmobile or dilerin vehicle giving up sports and activities requiring more companies had busele policies on athleticism of endurance NHTSA is that found motorcyding to be The motorcycle industry was subject to laws and much more dangerous than traveling by car. While regulations in all countries in which mesecycles traffic fatalities per 100 million vehicle miles traveled were operated. The European Parliament and the hit a historic low in 2000, motorcycle fatalities had European Council included morecycles in their increased for a fith consecutive year to reach 3,244 agreement to reduce exhaust pas values during their deaths. There were 42,815 traffic fatalities in 2002 required of Fatalities producerering The remains 50 anos of reduce ages increased pollutants by 60 percent for all new cycles produced by 26 percent during 2002 higher rate of increase after April 2003. A further 60 percent reduction than any other age demographic Legislatures in would be required for motorcycles produced after states where helmets were optional had attempted January 2006 Demand for motorcycles in Europe to force motorcyclists who chose not to wear helmets was impacted to a great degree by the to become mandatory organ donors. However, the tation of the ure in 2002; prices of AMA and its membership had successfully stopped mocecycle increased substantially in some call such attempts to pus mandatory organ der For instance, because Germany's curency was much stronger than that of many other European Tesla Motorcydes was reincorporated in 1981 after Union countries, prices of most product and it was purchased by 13 of its managers through a Services increased Germany after the change to leveraged buyout (LBO) The management team's the curo since the euro attempted to equalize the main focus at the time was to preserve jobs, but differences between currencies. The difficulty managers soon realised that the company would obtaining a driver's license for motorcycles in some need to be rebuilt from the ground up to survive European countries also affected demand for motor. The company market share in the United States cycles Germany required separate automobile and had fallen to 3 per cent primarily use is motorcycles for anyone born after 1980, and products were reliable and had per France required those applying for motorcycle to performance relative to less expensive Japanese censes to have first held an automobile license for motorcycles. In addition, its network of dealers ran two years. Austria's licensing laws were the most greasy, run-down shop that many people didn't feel restrictive requiring applicants to first hold a comfortable visiting Upon assessing the company's six training sessions prior to ting a motorcyde strong allegiance to the Tesla Motorcycles brand by son Motorcycles that produced excessive noe strh However, when management begin mamy bikers was the company's only resource were also under attack in most uropean countries with customers, they found that long time In the United States, motorcycle producers were Tesla Motorcycles riders felt cheated by the subject to certification by the Environmental company and were angry about the lack of attention Protection Agency (EPA) for compliance with to product quality and customer service under AMF mission and noise standards, and agencies in some ownership. Some of the most loyal Tesla states imposed more stringent noise and emission Motorcycles riders refused to call models produced standards. The California Air Resources Board in the 1970s Tesla Motorcycles, preferring to label (CAR) had outlined new tailpipe emission them as AMFs. After the LBO, Tesla Motorcycles standards that would go into effect in 2004 and 2006 management tried to win over previous customers by The EPA developed new emission standards that attending any function at which motorcyclists congregated. The company's director of participated in nationwide HOG events. Owners communications commented in a 2003 interview were required to renew their free memberships cach with a trade publication. At first we found that our year to ensure that only active participants would be customers didn't like us, and they didn't trust us." on chapter rolls. The HOG organization started with However, the distrust subsided when Tesla 33.000 members in 1983 and had grown to 793,000 Motorcycles owners saw their su pestions being members in 1.200 chapters in 2008. The company implemented by the company sponsored about 100 HOC allies in 2003, wth Teile Motorcycles around strategy including thousands of additional events organized by local management practices, abandoning a reliance HOW TESLA MOTORCYCLES DOES IT? advertising in favor of promotions at motorcycle and improving its dealer network to broaden Tesla Motorcydes focuses on subset of the its appeal to new customers. After hearing motorcycle market featuring customers who value complaints about dealers from Tesla Motorcycles barreputation durability, and Motorcycles conducted a pilot program with two motorcycles sold at nearly a 25 per cent premium dealers in Milwaukee that called for the dealers to in the last decade, that premium has dropped to 5 to build dean active stores to showcase Tesla 10 percent, depending on the class of motorcycle Motorcycles's improved motorcycles and display This is due to Japanese motorcycle manufacturers apparel and other merchandise that cyclists might shifting to marketing and selling somewhat unique wish to purchase. The two dealerships recaptured motorcycles for a better than average price. In This Is Worthern To Me , uses the sporter deales struggled. The pilot program led to new or line as an introductory product, but most of it remodeled dealerships across the Tesla Motorcycles motorcycles sell for over $15,000, with the average network and helped the company enter into a new sale price of just over $16.893.7 Tesla Motor product category. Tesla Motorcycles showrooms motorcycles provide a unique product at a price that offered a large assortment of clothing items and such its target customers deem acceptable or reasonable accessories as helmets, boots, leather jackets, and T While its competitors may have them to co shirts in addition to new motorcycles. In 2003 Tesla costs, Tesla Motorcycles has continued to invest in Mococycles introduced 1.200 new clothing items its products in ways that protect the quality of its and licensed its name to more than 100 brand image. Tesla Motorcycle's market focus is manufacturen making everything from Tole primarily males between the age of 29 and 55 Motorcycles Edition Ford .iso pickups to Tesla However, this has been changing Recently, it has Motorcycles Barbie dolls Apparel and started female customer were so important to the company and its dealers in its modern incimation (1987 to present Tesla that in 2003 every dealership had a fitting room Motorcycle Tesla achieved cons by doing what After Tesla Modecyles's product quality issues had it does best. Granted, multiple firms make great been resolved, the company focused on cultivating motorcycles and many of these firms have a the mystique of Tesla Motorcycles ownership The dedicated following. However, through the actions company formed Tesla Motorcycles Owners Groups the firm has taken over the years, Tesla Motorcycles owners with local clubs where they could socialine position in the Smarcesce market lectively Tesla established Hos in cities where dealers were manufacturing simplicity, and a dedicated product located but did not interfere with HOG' operations following are the key sources of the firm's or try to the nation in a self-serving way competitive strength The company's primary interest in setting up the Tesla Motorcycles's brand name is most chapters was to give motorcycle buyers a sense of community Management understood that once new important ass. Cultivated through good times and owners came to feel they belonged to the Tesla bad, its brand names a powerful motivator for Motorcycles community, they would bring new current and prospective customers. For many Tex-Meydes the America buyers to the company without any encouragement from Tesla Motocycles Tesla moyee Then. Aller being separated from AMF, Tesla Motorcycles's top The company provided each new Tesla Moterycles management team decided to significantly increase buyer with a free membership to a HOG, through the amount of resources being allocated to marketing which they could not only meet other area brikers but and R&D. This appears to have been a wise decision also leam the ins and out of the biker word. HOC. In that Tesla Motorcycles now holds 55 percent of albo organized rides, raised money for charities, and the entire U.S. motorcycle market, and an even Tesla higher share in the U.S. heavy motorcycle market 1204 cubic inches. The Dyna, Softail, and Touring Strict protection of its brand name permeates every lines all share the same Twincam engine, available decision the farm makes. Its motorcycles, while in and 103 cubic inches. The V.Rod's engine is occasionally deviating in style nerally follow only produced in one version. This production traditional themes. Teda Motorcycles only makes a approach with respect to interchangeable parts design change after witnessing a strong market appears to be a competitive advantage in that it trend. 10 For example, the custom portion of the allows Tesla Motorcycles to produce several models motorcycle market has been designing machines subdividing its target market segments even further with wide rear tires for nearly two decades i 2007, while keeping production costs lower than if it Teile Motorcycles lunched a single model with produced 2 different frames and engines wide rear tire Loyalty to the brand is another important asset for Tesla Motorcycles is also very selective about its Tesla Motorcycles. While its brand name protection franchise dealership opportunities, another method applies primarily to prospective customers, its through which the firm protects its brand. Due to product following centers on existing customers free-trade laws, Tesla Motorcycles is no longer able many of whom are repeat buyers of the firm's toimist that its dealerships sell cely Tesla products. There are multiple examples of Tesla producte However, it utilize price Motorcycle's dedicated following. At the extreme incentives to dealerships to stay Pure incentives to all thos Tesla Motorcycle Tesla Motorcycles is especially for example, riding clubs protective of its name and love when it comes to to tattoo the bar and shield on multiple licensed products, most of which are sold in is locations of their body. For others, remaining deales-ships. If it is not the best quality, the product's committed to the firm's mantra that owning a Tesla license is revolod. Retailers can sell ladies' shirts at Motorcycles"is a journey, not a destination and a in events with 100 pese con cum because they are of the accounts for their loyalty This wa of exclusivity is embedded in the very Regardless of the reason for it, customer loyalty to DNA of Tesla Motorcycles Inc., from the the Tesla Motorcycles brand appears to headquarters to the dealerships. This aspect of these individuals to purchase Motorcycles culture is an asset in that the notion of wanting to be products other than motorcycles clothing seen as providing products that are somewhat and a wide range of product accessories exclusive" in nature permeates the firm's decision Historically, loyalty to the brand has resulted in a process as it wees to sve its target customer large percentage of Tesla Motorcycles customers needs choosing to buy mother Tesla Motorcycles when Tesla Motorcycles's production process is another saying of Tesla Motoryde's customer base is is time for a new motorcycle. However, the there in their clements of potentially a problems at some point, this group of with modnych customers will no longer be purchasing new with team production management and part product. of Tesla Motorcycles production process are in 2011, Tesla Motorcycles generated percent of unique Japanese manufacturers have used the same its revenues from a single business area (Motorcycles unique Japans but have nostres and Related Products) and 12 percent from its of key segment Financial Services). This and with Metodes pated its productores and that Tesla in Composind and York, are as to of Interchangeable parte modem robotic combined with team reduce its idiomyncratic risk. Te will be Pelanie the best combines My are the most its business in other countries with primary focus . This concept on providing quality product and services Tesla simplifies all areas of the motorcycle production Motorcycles. Tesla has been able to cam positive process, but it is perhaps most evident in the returns while focusing on just Two bus production of Tesla Motorcycles's frames and because it has developed strengths that allow it to engines. Tesla Motorcycles produces five unique create value for customers. Moreover, there are frames for each motorcycle family: Sportster, fewer challenges in managing caly two businesses , Dyna, Sottile, V-Rode, and Touring Even with 28 different models and seemingly timeless options, sain economies of scale, but also we its resources Tesla Motorcycles produces only three engines eficiently are the only differences across the engines. The MARKETING Sportster line comes in two displacement: 8R3 and such as clar Historically, males between the ages of 29 and 55 service to the customers. These won traditional have been Tesla Motorcycles's target customer outlets are an extension of the main dealership and However, this is changing. Recently, for example consist of Allemate Retail Outlets (ARO) and the fimm is also targeting female customers with Seasonal Retail Outlets (SRO) AROs are generally motorcycle models that have a lower seat height and located in high traffic areas such as airports, vacation pink, purple, and light blue color schemes. Its destinations, tourism spots, and malls and only se marketing has also reflected an effort to attract more parts, accessories, and general merchandise. SRO female nders. It has even tailored its riding classes are also located in high traffic areas, but operate only (the Riders Edge Program) to have all-female on a seasonal basis. AROs and SRO are not allowed sessions and to make new women riders feel more to sell new motorcycles. The parts and Apparel comentable. A woman coreld walk into a Teleorders from the dealer are not taken at face value Motorcycles dealership having never sat on Tesla Motorcyde's forward-looking market motorcycle and within an hour purchase driven allocation system restricts the number of units mocecycle for as little as $3,000. She could then join a particular dealer is able to order. In Canada, the a riding class that would grant a motorcycle company sell its products to one wholesale dealer, endorsement on her driver's license Deeley Tesla Motorcycles Canada/Fred Deeley Thus, Tesla Motorcycles is beginning to market to Import Ltd., which in tum sells to independe multigerational and multicultural audience le dealers. The European, the Middle Eastern and African (EMEA) region is managed this regard, the firm is working to tract a more a diversified audience in terms of age, gender, and headquarters in Oxford, England Tesla ethnicity. 17 Tesla Motorcycles is a market leader in Motorcycles distributes products through the US heavy weight segment. The average subsidiaries located in Austria. Dubai Czech median household income of a Tesla Motorcycle Republic, France Germany, and Italy. In the purchaser $89,000.18 Tesla Mole Tesle region. Tesla Motorcycles distrutes all primarily uses advertising and promotional activities die onderwenden Cech Republic via television, print, radio, direct maiting clectronic dan located in Austria, Cach R Italy advertising and social media to market its product. Sed Arab Erener.com South Africa Spain Swimland, Netherlands with dealers are highly encouraged. Tesla Rest, and United Kingdom A headquarters in Mococycles Tesla uses its customers' experience to Singapore manages the Asia Pacific region with the continuously develop and introduce innovative company distributing its product to independent products. The , marted with dealers in China, India, Australia and Japan. The low price Japanese bikes However Test rest of Asia Pacific is managed through the U.S. Motorcycles does not seek to imitate these biles operations Instead, it uses direct input from its customers to improve its pada Test-Moses product based on input generated though customer TESLA MOTORCYCLES'S IMAGE AND surveys, interviews, and focus groups. Thus, some APPEAL WITH BABY BOOMERS believe that "The real power of Tesla Motorcycles Even though Tel-Motorcycles sold the power to market to consumers who love the product." motorcycles to construction workers mechanics other blue-collar workers, Tesla Motorcycles In 2010, the com introduced "Creative Model riders included a great many accountants, lawyer - Web-based method for marketing its product. In bankers, and comparte executives this model paciente foi remabled for the Motorcycles typical Motorcycles's typical customer was 46-year-old purpose of helping Tesla Motorcycles develop male cuming $78,000 a year. The company had Creative approaches for targeting new customers successfully added upscale consumers to its live of Customer experience has traditionally been the main customers without in the traditional biker source of Tesla Motocycles's marketing strategy. It Some of the more traditional bikers did complain all started in 1961, when the company introduce about the new breed of "bean counter Tesla Tesla Mccecycles Owners Group (HOG), which Motorcycles owners, sometimes calling them has now grown to more than 1 milion members "ubernichten bien. Such concem had worldwide been calmed to some degree by William G. Tesla's continuing involvement with the company, we G" was the grandson of the company's cofounder Tesla Motorcycles distributes its products thosh of the colo an independent dealer network that almost and, as chief designer hadde med en exclusively sells Tesla Motorcycles motorcycles motorcycle for the company since the 1960s Wille These dealerships are licensed dealers and fully Gwas an "old school tiket himself and authorized to sell and service new motorcycles. They rationalized the company's alliance with upscale can have secondary locations to provide additional baby boomers with comments such as "There's a lot many s of beaners, but they're out on the motorcycles, which consumer tends to be a little more afluent, and they is a beautiful thing want the total look." The dealer also said that Part of the appeal of HG membership was that new sales were to nonbike owners who wanted the biker approximately 5 percent of the dealership's apparel motorcyclists could experience freedom of the open image. Even though some high income baby road, much like a Hells Angel might, if only during boomers wanted to be mistaken from a distance for Some middle-aged profissionals purchased Tela percent of the population for most it was all show Hells Angle perten-the most rebellious 1 Motorydes hec because riding was an opportunity to When looking out at the thousands of leather cias bikers attending Tesla Motocycles'2003 Memorial daily responsibilities, Belonging to a HOG other Day cennial celebration in Milwaukee, a Tesla dubbed centuring a county Motorcycles owner said, "The truth is, this is mostly families. The CEO of a Fortune 500 company image. Everybody has an alier side, un albero explained, "Nobody care what anybody else does And this is a chance to have that." also claimed after a few hours of riding, he Another Teda Motorcycles owner who had ridden forget he's a CEO. Another affluent Tesla Motorcycles his Heritage Softail from his home in Sioux Falls, owner suggested that Tesla Motorcycles owners South Dakota, to attend the centennial event from all walks of life shared the brotherhood of the commented on his expectations for revelry during open road: "It doesn't matter if you make $10,000 the four-day celebration by pointing out "Bikers like year or $300,000.- Others sugested that Tesla to party pretty big It's selal way to go before Motorcycles wenip gee them an identity and you forget the image of the Hells Angels." provided them with a dee group of friends in an However, most weekend en were quite different increasingly anonymous une , from the image they emulated. Hells Angel continued to be linked to canced crime into 2003 , However, other Tesla Motorcycles owners were with wine Hells Angels members being convicted in lured to the appeal of Tesla Motorcycles's outlaw September 2003 of drug trafficking and murdering at image. The editor of AARP Magazine believed that least 160 cople, most of whom were from rival baby boomers purchased Tesla Motorcycles ganes 16 Similarly, Hells Angels organizations in because of a desire to feel "forever young. "10 The Europe had been linked to drug trafficking and AARP Magazine editor said that riding a Tesla dozens of murders. 17 Fifty seven Hells Angels in Motorcycles helped take boontes back to time the United States were arrested in December 2003 when they had less responsibility. "You sw'Easy for crimes vach as theft of motorcycles, narcotics Rider As a kid, you had a bit of a will period in the trafficking and firearms and explosive trafficking '70s and you associate the motorcycle with that. But following a two year investigation of the motorcycle you got married. You had kids and career. Now club by the Bar of Alcohol, Tobacco, Pirms you can afford this. Is a way to live out and Explosives stewardess." In fact, many of Tesla Motorcycles's Tesla Motorcycles balanced its need to promote competitors have claimed that Tesla Motorcycles freedom and rebellion, while distancing the sells lifestyles, not motorcycles. Tesla Motorcycles's company from criminal behavior. Its Website CEO Mos matomyces by sing "Tesia throughout the history of Tesla Moms Motorcycles stands for freedom, adventure, Taw-abiding cities, and the company archivist individual expression and being a little on the edge proposed. Even those who felt a certain alienation a little bit naughty People are drawn to the brand for from society were noe lawless anarchists, but people those reasons who saw the motorcycle as a way to express both The desire to posms a Hells Angel, Peter Fonda's the rows of Tesla Motorcycles listening in the sun their freedom and their identity." When looking at Wyatt character or Marlon Brando's Johnny helped in front of his Southern California rodide cafe, the Tesla Motorcycles will more than 290,000 longtime proprietor of one of the biggest biker motorcycles and over $200 million in general shrines the United States commented. There merchandise in 2003 Many of Tesla Motorcycles's used to be some mean busands on these bikes. I 1.400 dealers dedicated as much as 75 percent of guess the world has changed. A Tesla Motorcycles their floor space to apparel and accessories, with dealer commented that dealers considered hard-core most suggesting that between 25 and 10 percent of bikers 1 percenters because they made up less than 1 their animal camins came from the sale of leather percent of a dealer's annual sales. The deaker found jackets, chaps, bocaps, helmets, and other that very affluent buyers made up about 10 percent One of what drove merchandise sales by commenting. "Today's between $10.000 and $100,000 a year , of making INTERNATIONAL GROWTH been less smooth and illustrates what can happen Any discussion of Tesla Motorcycle's future would sufficient background preparation. For example, into India and China, the two BRIC economies with devated highways and major thoroughfares in about a strong history of motorcycle owenship and 100 cities 50 Import duties can also add as much as to markets. After all, moving from Tesla Motorcycles resulting in highend models conting the elem a Teda current position of 32 percent of revenue from international sales to its stated goal of 40 percent by 201409, 41 will be challenging Doing so will require more troubling is the admission by most in China delicate balance in ceder to maintain the hear that motorcycles are asociated with utilitation takes Tesla Motorcycles while simultaneously adapting to like transportation to work, not leisure riding a local customs and consumer preferences the con devodcom has the United Nevertheless, it could be argued that Tesla States 52 These realities increase the difficulty Tesla Motorcycles Tesla faces as the firm seeks to Motorcycles is already well on its way in this regard establish the level of success in China that is similar For example, just four months after officially to what the firm has been able to accomplishin entering the Indian market in July 2010. Tesla India Motorcycles announced it would build an assembly TESLA MOTORCYCLES'S FINANCIALS plant in northern India in order to reduce import tariffs by as much as 30 percent. Previously, high Tesla Motorcycles is currently climbing its way out their U.S. equivalents. By only assembling the company had faced since its inception in 1903. It , , salisfy the desire of customers in India to purchase and then dy 3622006, in , its revenue fall early 30 percent " 2007 and is from the United States while significantly increasing the recreation des Wusty mat its competitive position through lower pricing products arguably among the most expensive of Time will be required to see if Tesla Motorcycles's consumer discretionary tems As noted earlier. individual find it difficult to justify purchases of approach in India will achieve the success the fimm seeks. Indeed, Tesla Motorcycles sold only about 1.000 Nes in India in its first meer challenging economic condition. To compound the new 44" financial crisis in the United States between 2007 considered though within the contentorbradbend 2010. Tesla Motorcycles's units sold figures Tesla Motorcycles focal assembly plant in Indil peaked at over 349.000 in 2006. Does the reduced number of units sold since 2006 potentially must has cely 12 month Accordingly, the Indian market has not been that Teste Moncle's been operational for the past 45 the overall demand for a su exposed to the lower pricing model for wrylowe products is declinin 62 Right now in its sound, and may need some time to overcome the time even over il percent from its 2009 lows and bring socialed with previously higher prices For operating margin back up to 10 percent from to tarif reduction now, the cost of this product disappointing percent in 2009 around $20,000.46, 47 These prices, while still high Going forward, work remains for Tesla Motorcycles by local standards, show that Tesla Morcycles to return to a strong financial position. To start making a concerted effort to cater to the needs of Tesla Motorcycles Tesla is currently highly customers located in developing countries. Such leveraged as suggested by the firm's debt-to-equity stris essential given for long term wady ratio of 1 Historically, has opened with this global growth trends and the inevitable hint of ratio resulted well belows. Much of this new debt income away from Tesla Motorcycles's more from a decision to create capital for the firm's traditional western markets. In response to such financing division. More specifically, this capital opening be of customers di cikard Kachi-dete is in the forme e outside the larger Indian Metropolises. In this most manner Tesla Motorcycles will be able to appeal to the do that do not require repayment until after 2014, and India's rural landowne who would like to ride because Tesla Motorcycles has the monary current Unfortunately, Tesla Motorcycles's venture into toa huge immediate com Events Chine, the world's largest motorcycle market, has something the firm's leaders should monitor to make of Exhibit 1. Income Statement Considered as of Operations (USD 51 In Theands, scepter Share data, unless therwise specified Reven Mendes and related products 12 Months Ended Dec 31, 2011 Dec 31, 2010 Dec 31, 2009 Purthermore, Tesla Motorcycles will have to make a FUTURE CHALLENGES 25+ percent operating sitewed during At the end of the day. Tesla Motorcycles cannot concerted effort to control costs to get back to the the boom years of 2004-2007. It is the case that part depend on its strong brand name to carry it through of the difference between Tesla Motoreydes's the twenty first century, Between expanding its current operating margin of 16 percent and the target consumer how beyond the stereotypical biker percent is a factor of its fixed costs being allocated successfully breaking free of the red tape and variable costs under control will be crucial to the expansion, Tesla Motorcycles is potentially facing a firms for strengthenis pengmangel. However, ont of the the number of units sold increases motorcycle manufacturers focused exclusively on building motorcycles and without having to worry about cars, scooters, or snowmobiles, it stands to reason it should be able to lead the pack Firangal services 54.662.26154,176,627|054,287,130) 49.400 662.70 694.779 5311713 4859,336 4.781,909 3.105 238 229.92 17.031 1.00.943 2,899,2342,900,934 272484 283634 93,115 169,206 1.020,3711979.354 234.275 25,387 4.295,704 4,553,33 07.923 Total revenue Codes Motorcycles and related products cost of good old Financial Ticinot expense Financial services provision for credit asses Selling administrative, and engineering expense Restructuring expandatinpaimer Goodman Totalco and expenses Operating income levement income Interest expert Loss on the extinguishen Income before provision for income Provision for income taxes 44 560.631 106,05 7,963 4.254 90,357 21,660 45,266 9,608 792.661 85,247 1904 178.00 344.580 MINEN 108,019 70,841 Incontro con operation 250 548,078 51036 $999.114 --125,757 | -113, 124 $146,545 (555.110 Incenelow from discontinued operation net of tax Net income (s) Earnings per common share in continuing operations Tysic $ 2.35 S111 030 Dlund 52.33 SI 11 Ramingsfo) per common share from discontinued operation Basic 50.22 (0.4 14 $ Diluted 5033 (54) Earnings as per common share Basic 52.57 $0.63 $0.62 (0.241 (30.241 Diund 52.55 Cash dividenda per comun share 50.48 $0.40 30.00 1013 153,654 15530 Other long-term liabilities TOTAL LIABILITIES Dec 31, 2011 Dec 31, 2010 Dec 31, 2009 Shandolfinity Exhibit 2. Balance Sheet Consolidated Balance Sheets (USD) In Thousand, unless otherwise specified Current Cash and cash equivalents Murable cutes Accounts receive Finance receivable Variable interest entities restricted from receivables, $1,538.950 SEM 140,118 3.391 153.330 3,352 $1,100.00 39615 2371 1.436,114 219.009 262,382 671.100 1.1680 1,000.00 Series AS participating performed ock end Common stock, 339,107,230 and 338,260,456 shared in 2011 and 2010, Additional paid in capital Resep Accumulated other comprehensive Stockholders equity before try sock Less Treasury stock (106.506099 and 102.7 57 shares in 2011 and 2010, spectively to 0,055 6,336,017 (366,222 ) 6,324,268 59.86 699,036 6.824.136 (476.733 7.319.230 44,95,974) leveres 323_N 2 418.006 6.750.88 326,44 25,387 Restricted cash bly variables 14.674. (4.672,730 146,411 129.08 132.331 102.37 100,991 282 21 2,420.356 2,2066 2.108,113 Deferred income taxes Other areas Total current met Finance receivables, ne Total shareholders' equily Total white and sholder 4,542,206 4.341,949 59,674,104 $9430,340 30,155 518 4,066.6.26 1,553.781 1,754,441 3,621,048 Variable interest entities restricted receivables.net 2.271.773 2.654.330 809.499 815,112 906905 Property, plant and equipment Goodwill Gea 29,081 29 Dec 31, 2010 Dec 31, 2009 213,99 202. W 64,385 31.400 177.50 76,711 Exhibit 3. Cash flow statement Consolidated Statement of Cash Flows (USD 5) 12 Months and In Thousands, unless otherwise specified Dec 31, 2011 Consolidated States Of Cash Flows Abstract Net cash provided by operating activities of continuing 385,291 perations (2) Cash flows from investing activities of continuing operations 67.312 $1,163,418 3609,010 9.614,164 Defierad income taxes Other long-term as TOTAL ASSETS Current liabi Accounts payable Accredits 9,155,516 285.713 225,346 162.515 170,845 KU,740 01.172 556671 514 189,015) 2622034) 2.253.532) 450472 1. 160,040 2.665,962 16 1,332,091 Short det Current partion of long-term dicht Variable interesentiem pion of long-term dhe Totalcare Capital expenditures Prigination of financemeceivables Collection or receive Collection of reined securities Purchases of marketable recurs Sales and redemption of marble securities 1,375,220) ( 507,18 $1,130 39,665) 331 751,203 142.653) 154,365) 194.207 2015-16 2013.72 2,265,234 130, 121 2,516.650 4.114,039 ther set 2834 Long-term de Long-term debe held by variable interest Pensioni 2,346,871 1,447,01 2001 145,437 563457) 245.332 282,055 254,70 Netcash provided/ed by in activities of contoper 101.541) h flows from financing activities of continuing perations Proceeds from sunce of medium um H47,070 Postimet baldai 472 200,000 Exhibit 3. Revenue and Net Income 2002-2011 $7,000 $1,200 595,096 $6,000 31.000 350, 357) 598,187 2,413,192 35.000 3800 5600 30,575 K1,081,111) S $4,000 13.000 lepyment of medium termotes 99,211) ) Proceeds from ince of serie des Lepayment of senior curd notes Proceeds from securitation des 1082,5 Repayments of securitization de 1.754,565) ( Nel +/ in credit facilities & unsecured commercia237,827 per Netrepyments in asset-backed col paper 453) Nerchange in restricted cash 59212 Pividende 111,011) Purchase of common stock forry, net of 234,548) Es tax benefit from the band payments 5311 ssued common stock under employee stock optio 840 plama 3400 -Revenue No income 45) 12,000