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What Do You Think? Manufacturing Quandary

S

savatage1973

Addicted Member
I know--charged topic, and if I am too dangerously close to "that line", please delete immediately--but at least hear me out first.

https://www.yahoo.com/news/harley-davidson-moves-us-due-tariffs-173840156.html

This is not a unique phenomenon--not specific to H-D or the US, for that matter. Due to a multitude of economic considerations in the evolution of the "global market", many "iconic" brands have outsourced parts or wholly moved production of their products outside the borders of the country in which they were established.

In the audio world, we have seen this occur with many brands over the decades, with production being moved to the East or even different parts of the East, or South.

Perhaps the most historically publicized industry in which this has occurred is the automotive industry. "American" vehicles are no longer made in America with American parts. Same is true for German and Japanese vehicles. There are far more "American", "Korean", "Mexican" (and to a lesser extent) "Eastern European", and "Indian" American, Japanese and German vehicles on the road than their counterparts built back in their homeland. Even "Korean" vehicles are now being built in the US.

So what do we think of all of this? Is it a "sign of the times"? Economic necessity? Good idea/bad idea?

Remember--try to think like the CEO or Board of Directors of an international corporation in a global market, rather than your "gut"--or at least like the bulk of your retirement is invested in these companies ;)
 
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I was drifting the edge of this with friends in Facebook.
There was a time when Harley Davidson had a line of smaller displacement bike imported from Italy.
(In the car business, they were called "captive Imports", like the Dodge Colt, Plymouth Arrow, etc).

Harley did not actually BUILD them overseas, they came from another company who branded them for Harley.
Here's an example - 1967-72 Harley Davidson Leggerro - 65cc by Aermacchi.
But they made other ones up to 350cc - mostly 2 stroke (mix gas and oil!)

http://aermacchimotorcycles.com/home/about/

HD-65.jpg
 
Starting my career at Ford Motor i am surprised Harley didnt do this sooner. Running an global business is about profit not human sentiment...
Unless it affects profit.
 
The ultimate global venture ...

iss-saucer.jpg
 
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They were talking about that this morning on the talk radio station I listen to in the AM. Seems Harley Davidson has been planning on moving a lot of it's production overseas for quite some time. The "tariff" may just be a convenient excuse so as to not piss off loyal customers.

They also noted that motorcycle purchases and ridership have been on decline since 2006, which may be part of the problem, too,

Of course, we all know that everything we hear on talk radio is true. Isn't it?
 
There are over 49,000 new and used Harleys for sale on cycle trader..methinks
there is excess inventory...... Sell them overseas, build them overseas.

Just under 6000 Indians for sale on cycle trader.

My neighbor bought a dresser about 10 years ago , now he never rides it.
my be to many wacky car drivers ?

https://www.cycletrader.com
 
The first car sold in China.....ever.....was a Ford model T.

AND, at the time it was brand new.
 
Regardless of current events, it's been harder and harder to do low volume products in the US. Costs are just too high. I've seen this trend for a couple decades. I don't think autos can be looked at in the same way due to economies of scale, but I'm guessing the motorcycle business is harder every year. It would be really interesting (to me, at least) to see how many garage type businesses start up every year that manufacture something. I'm thinking of businesses that will become the Hewlett Packards of the future. https://en.wikipedia.org/wiki/HP_Garage Is the trend up or down?
We have Kickstarter and other interesting avenues, but you still have to sell the stuff and make a profit.
 
Harley has had plants overseas for awhile now as US sales have sagged.


Fair use from a past N Y Times article on May 23,2017 ....

"Harley-Davidson has long cast its eyes abroad amid sluggish growth at home. It hopes to make half its sales international over the next decade, compared with about one-third last year and less than one-quarter 10 years ago. Its international sales last year grew 2.3 percent; by contrast, sales in the United States fell 3.9 percent.

Despite Harley-Davidson’s all-American reputation, the Thai plant will not be its first abroad — or even in Asia. The company opened a similar plant in Bawal, India, in 2011 to help it get around that country’s 100 percent tariff on imported motorcycles. It also assembles motorcycles at a plant in Brazil and has a wheel factory in Australia. The Thailand plant will assemble motorcycles for Asia that were previously imported from India or the United States.

Harley-Davidson’s made-in-Thailand motorcycles will avoid the country’s up to 60 percent tariff on imported motorcycles. They would also get a huge break on tariffs when exported to Thailand’s neighbors, thanks to a trade deal among the 10 members of the Association of Southeast Asian Nations, or Asean.

The Thai plant is also intended to help serve a vast market in mainland China. Asean is pursuing an enlarged free-trade area with Beijing. And Mr. McAllister of Harley-Davidson said the Thai plant would lower the transport and shipping time to the Chinese market to around five to seven days, from 45 to 60 days from the United States.

For big companies, “the economics are increasingly compelling, and Asean is again attracting the lion’s share of foreign direct investment into Asia, after China had been the primary destination for many years,” said Frederic Neumann, a co-head of Asian economic research at HSBC in Hong Kong.

By contrast, many of those nations charge steep tariffs on foreign-made goods like Harley motorcycles."



Bob
 
604man said:
49,000 new and used Harleys for sale
Click to expand...

HD's became fashionable. and like all fads, faded away. There are tons of low mileage bikes on the market for half what they cost new. The chopper craze ended, and $40, 000 customs can be bought for $8,000. Harley has been living off accessories and upgrades for a while and will eventually have to downsize.
 
I remember there was a stiff tariff on Japanese bikes in the 80's. The combination of the new Evolution engine and the tariff's may have kept them from going down the tubes.

"Harley-Davidson, which produces bikes of 1000cc and 1300cc (although new, smaller models are planned), has continually been losing ground to Japanese competitors. In 1972, Harley had 100 percent of the market for motorcycles with engines of 1000cc or more; a decade later it had less than 15 percent."

https://www.nytimes.com/1987/03/18/business/harley-asks-end-to-tariff-aid.html
 
grillebilly said:
I remember there was a stiff tariff on Japanese bikes in the 80's. The combination of the new Evolution engine and the tariff's may have kept them from going down the tubes.

"Harley-Davidson, which produces bikes of 1000cc and 1300cc (although new, smaller models are planned), has continually been losing ground to Japanese competitors. In 1972, Harley had 100 percent of the market for motorcycles with engines of 1000cc or more; a decade later it had less than 15 percent."

https://www.nytimes.com/1987/03/18/business/harley-asks-end-to-tariff-aid.html
Click to expand...

Honda sold a 700cc Shadow in the US back then because there was a stiffer tariff on the 750 version.
 
HD has used Showa suspension components for decades, Mercedes builds SUVs in Alabama, Buick builds for domestic production in China, Honda built Gold Wings and VTX-1800s in Marysville Ohio.
A certain "effing moron" needs to get an effing clue.
 
hjames said:
Harley did not actually BUILD them overseas, they came from another company who branded them for Harley.
Here's an example - 1967-72 Harley Davidson Leggerro - 65cc by Aermacchi.
But they made other ones up to 350cc - mostly 2 stroke (mix gas and oil!)
http://aermacchimotorcycles.com/home/about/ .
Click to expand...

Actually Harley owned a controlling interest in Aermacchi and they did build some 250cc and 350 cc 4 strokes called Sprints. Before Aermacchi they built some 2 strokes as well based on a spoils of war design after WWII the Hummer and it's siblings.
 
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