EXPERIENCEBUSINESS - Harley-Davidson

CHAIRMAN’S LETTER
We fulfill dreams through the experiences of
motorcycling – by providing to motorcyclists and
to the general public an expanding line of
motorcycles, branded products and services in
selected market segments.
–HARLEY-DAVIDSON MISSION STATEMENT
DEAR FELLOW SHAREHOLDERS: Riding a Harley-
Davidson ® motorcycle generates an abundance of
physical experiences. For Brenda and me it’s things
like the overwhelming beauty of the Great Salt Lake
at dusk, or the scent of pine as we cruise through
a Carolina forest, or the thunder of five thousand
Harleys parading down Main Street in Durango, or
the surge of power from our Twin Cam 88 TM
motor as
we soak up the highway miles. It’s also experiences
like shivering in wet clothes when the rain clouds
burst before we can reach the next overpass.
But the experiences of Harley-Davidson motorcycling
go well beyond the physical and into the
emotional and the transformational. Like the sensation
of witnessing a child’s excitement when the Biker
Toy Run rumbles up to the local hospital, or the
gratitude of the Muscular Dystrophy Association for
the impact we’ve had on the search for a cure. Or it’s
the affect on our psyche when we share our personal
road tales and dreams with newfound friends at a
H.O.G. ®
rally or discover in ourselves an incredible
sense of accomplishment and well-being at the end
of a long ride.
Ask any Harley ® rider – they’ll gladly share their
experiences. These experiences of motorcycling create
the thoughts, images and emotions of which dreams
are made. So when we say “We fulfill dreams through
the experiences of motorcycling,” we’re talking about
“E” business – Harley style … the Experience Business.
With forces as strong as these at work, perhaps
it’s not surprising that in 2000, Harley-Davidson
achieved its 15th consecutive year of record revenue
and earnings. In 2000, we produced 204,592 Harley-
Davidson motorcycles, a 15.5 percent increase over
the prior year. Our Buell family of motorcycles also
continued to grow with the single-cylinder Buell ® Blast TM
bringing new riders into the sport and convincing
some of those who used to ride to get back into it.
In Europe, our business continued to expand and
we improved our market share for the second year in
a row. We acquired the business activities of our Italian
distributor and now have direct control over Harley-
Davidson and Buell sales in eight countries while we
partner with independent distributors in another
seven. In the Asia/Pacific region, our market share
grew as well. We have dealers in eight countries and
are the No.1 heavyweight motorcycle manufacturer in
each of those markets. Our business in Latin America
also grew significantly as we expanded our presence
in Mexico and Brazil.
Both our Parts & Accessories and General Merchandise
businesses made strong gains in 2000. Parts &
Accessories saw revenues rise to $447.9 million, a 23.5
percent increase over 1999, as our customers continued
to personalize their motorcycles to enrich their motorcycling
experiences. Our Custom Vehicle Operations,
which creates limited edition, highly accessorized
motorcycles, also recorded a banner year with revenue
growth approaching 50 percent over the prior year.
3