American Motorcycle Dealer AMD 181 August 2014

™ OUR NOW IN 1 At 2YEsR T H E O N LY M A G A Z I N E F O R T H E W O R L D W I D E V- T W I N PA R T S , A C C E S S O RY A N D P E R F O R M A N C E I N D U S T RY AUG 2014 Harley falls "short of expectations" in ISSUE #181 flat second quarter; full-year shipment NEWS growth forecast revised down HARLEY-DAVIDSON dealers worldwide sold 90,218 new Harley-Davidson motorcycles in the second quarter of 2014 compared to 90,193 motorcycles in the year-ago quarter. In the U.S., dealers sold 58,225 new Harley-Davidson motorcycles in the quarter, compared to sales of 58,241 motorcycles in the year-ago period. The Company believes second-quarter U.S. retail sales were adversely affected by prolonged poor weather across parts of the U.S. and soft Sportster motorcycle sales ahead of the highly anticipated arrival of Street motorcycles in dealer showrooms. In international markets, dealers sold 31,993 new Harley-Davidson motorcycles during the second quarter, compared to 31,952 motorcycles in the year-ago period, with sales up 7.0 percent in the EMEA Region and 1.5 percent in the Asia Pacific Region, and down 10.4 percent in the Latin America Region and 18.0 percent in Canada. Harley-Davidson, Inc. Chairman, President and Chief Executive Officer Keith Wandell said that "U.S. retail Harley-Davidson sales fell short of our expectations in the second quarter. "Because we are committed to managing supply in line with demand, we are reducing our full-year shipment plan and now expect shipment growth sales up 7 percent in Europe' of approximately 3.5 to 5.5 percent over last year." The Company previously had forecast full-year shipment growth of approximately 7 to 9 percent. "We believe the underlying demand fundamentals of the business remain intact," said Wandell. "We continue to see a strong response to the new Rushmore models as well as great interest in the Harley-Davidson Street 750 and 500, which began to hit dealer showrooms in late June." Through the first six months of 2014, dealers sold 147,633 new Harley- Davidson motorcycles worldwide, compared to 144,447 motorcycles in the year-ago period, with retail unit sales up 1.1 percent in the U.S., 10.1 percent in the Asia Pacific Region and 7.5 percent in the EMEA Region, and down 2.1 percent in the Latin America Region and 13.5 percent in Canada, compared to the year-ago period. In financial terms net income rose 30.3 percent ($354.2 million) for the quarter on consolidated revenue of $2 billion ($271.7 million on $1.79 billion in second quarter of 2013), with diluted earnings per share growing by $1.62 (33.9 percent) year-over-year Through six months, Harley-Davidson 2014 net income was $620.1 million on consolidated revenue of $3.73 billion, compared to six-month 2013 net income of $495.9 million on consolidated revenue of $3.37 billion. Six-month 2014 diluted earnings per share were $2.82, up 28.2 percent from EPS of $2.20 in the year-ago period. "Harley-Davidson's second-quarter results reflect the financial strength of Continued on page 6 >>> MINIBIKE 74 When it comes to Harley-based builds in the Freestyle class at the World Championship most builders start with a Big Twin. However, Maik Morató Güell is not like other customizers and he used as little as possible around the Sportster engine he used as a starting point PAGES 13-15 >> SHAW HARLEY-DAVIDSON PRODUCTS