Harley-Davidson doubles down in the face of cheap competition

Harley-Davidson headquartersScott Olson/Getty ImagesHarley-Davidson corporate headquarters in Milwaukee, Wisconsin.

Quintessential American motorcycle maker Harley-Davidson is facing steep competition from cheaper motorcycles imported from Asia.

These less-expensive alternatives, along with slipping revenues (down by 10% for the second quarter of 2015) and a declining U.S. market share (below 50% for the first time ever) spell trouble for the Milwaukee motorcycle mogul.

Bloomberg News reports that despite these challenges, the company is betting on its name recognition and bike quality to keep consumers on board, rather than producing cheaper bikes:

Harley’s decision not to slash prices in turn, is a bit of swagger, a subtle way of saying: Our bikes are better. It also aligns the company with current Harley owners, as a dip in sticker prices would dent the resale value of used bikes.

Americans are loving motorcycles right now, with new registrations up 7.6% in the last six months. Harley-Davidson sales, however, were down by over 1,000 bikes this year compared to the same time period in 2014, which the company blames on the strength of the U.S. dollar.

“We are confident in the strength of our business and the strategies we have in place to maintain our industry leadership and grow our business over the long term,” said Matt Levatich, President and Chief Executive Officer.

“Our singular focus on the customer through unrivalled products, unique experiences and our expanding dealer network is the bedrock we are building on.”

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