Environmental Analysis : Harley Davidson

Environmental Analysis Paper

MBA/580

University of Phoenix Online

Executive Summary – Environmental Analysis

The motorcycle industry is a consolidated industry. The U.S. and international heavyweight motorcycle markets are highly competitive. The major players, such as Yamaha, Suzuki, and Honda, generally have financial and marketing resources that are substantially greater than the non-major players. Competitions in the heavyweight motorcycle market are based on several factors; price, quality, reliability, styling, product features, customer preference, and warranties.

Harley’s first segment is the motorcycle and related products business. It included designing, manufacturing, and selling primarily heavyweight touring and custom motorcycles and offering a broad range of related products that included motorcycle parts and accessories and riding apparel. The custom products charge a higher price because of its features, styling, and high resale value. Their target market is mainly in US. By the end of 1997, they have an approximate 48.3% share in the US market, 6.1% share in European, and 16.5% share in Asia/Pacific.

New competitors have entered the marketplace because demand for the motorcycles has exceeded production. The demand is prospected to grow in the future, and the switching cost is low.

The company should continue to build their enterprise. Since the industry does not have significant economies of scale, growth-via-acquisition strategy could be used. Harley-Davidson can merge or acquire weaker rival or smaller players. Taking over the weaker and smaller players will increase the entry barriers (echeat, 2008).

Environmental Analysis

Strategic Imperatives

In creating an effective strategy for the Harley-Davidson Company (HD), the company’s external environment was scanned to identify multiple opportunities for and threats against the company in the next five to ten years. In addition,...