William Harley and his partners, the Davidson brothers, took a simple vision and turned it into a company that produced motorcycles for customers worldwide. The Harley-Davidson name became an icon of American culture that has incurred a large and loyal following.
William Harley first began tinkering with the idea of producing a machine that would be easier to ride than a bike while in his early twenties. Along with brothers Arthur, William, and Walter Davidson, the four men designed the first Harley-Davidson motorcycle in a relative's garage. Harley later returned to school in Milwaukee for the technical expertise that would enable him to modify and improve the machines he would build in the future.
The Harley-Davidson motorcycle was conceived in the early 1900s. Harley and a machinist friend, Arthur Davidson, designed the initial "motorized bicycle" in 1901. They were interested in creating an alternative that "took the work out of bicycling." The first Harley-Davidson motorcycle had a single-cylinder engine, went no faster than 25 miles-per-hour, and used an empty tomato can for a carburetor. Davidson's aunt created the later famous black and red logo and painted it on the first bike.
The help of two other Davidson brothers was enlisted to replicate the bike. By 1903, the first three machines were completed and sold by the C.H. Lang dealership of Chicago. The foursome launched the business in a backyard garage.
Building a motorcycle in the early 1900s presented challenges that the partners had to overcome, many similar to what Henry Ford and R.E. Olds were facing with manufacturing the automobile. Parts were not pre-made and had to be created from existing materials. This was an extremely labor-intensive task that took quite a lot of time. Gas stations had not yet been established, so fueling was a problem. Gas could only be purchased by the pint and only at drugstores. Regardless of these difficulties and inconveniences, the business grew quickly and the bikes gained a reputation as a sturdy and reliable machine for getting around. The company built its headquarters in 1906 and incorporated in 1907, the same year that the four partners produced 150 machines. By 1910 the company employed 149 people. The four partners continued to speed production and managed to become one of the largest producers of motorcycles in America by 1915.
Harley-Davidson paid little attention to the promotional benefits of racing until 1908. While the bikes had been entered in races, it was generally assumed that when they won, it was because of their durability, not their speed. Walter Davidson decided to lay that perception to rest and raced the motorcycle in 1908, earning excellent scores in competition and achieving unprecedented gas mileage. Word of his racing success spread quickly and bike sales soared.
Around this time, Harley completed a degree program in Madison, Wisconsin and returned to the company to put his knowledge to use in designing a more powerful bike. By 1911, the new machine was available to the public. At this time, most motorcycles were using a chain drive to provide power to the rear wheel, and Harley-Davidson's chain drive model was completed and on the market by the end of 1912.
As the company grew, so did the factory. The first space (28 feet by 80 feet) was expanded to 297,110 square feet, with 12,904 machines produced in 1913. More and more of the machines were used in racing events. World War I also created a new use for the machines and 20,000 of them were used in the war. In November of 1918 the first American to enter Germany crossed the border on a Harley-Davidson. The use of the machines in the war brought to light a new issue—a lack of people in the military that were able to repair and maintain the machines. To address the problem, Harley-Davidson set up a training class for the military in 1917. After the war, the training school continued its programs and trained Harley-Davidson mechanics into the 1990s.
The 1920s saw continued growth for Harley and the company. Over 28,000 machines were produced in 1920 and dealers worked worldwide. At this point, the company was the largest maker of motorcycles in the world. The company continued to improve on the machine and design new innovations, such as a teardrop shaped gas tank (designed in 1925) and a front brake (1928). The motorcycles continued to race, with one Harley-Davidson competitor in Fresno, California becoming the first person to win a race at speeds averaging 100 miles-per-hour. The 1920s also gave rise to Harley-Davidson jargon such as using the word "HOG" to refer to the bikes. The reference originated after the company factory team bought a mascot pig to each race. Spectators referred to the group as "the Harley Team and their hogs."
When the Depression hit the United States in 1929, Harley-Davidson was impacted much like the rest of the economy. By 1933, only 3,700 bikes were being produced. Harley and his partners, according to factory workers, kept as many of the factory staff as they could afford during the Depression by reducing everyone's working week. When the country started to recover economically, Harley-Davidson was ready with a new innovation—a motorcycle model that used a 61 cubic inch overhead valve engine (referred to as the Knucklehead). By 1936, production had increased to 9,812 bikes. The onset of World War II greatly increased demand for Harley-Davidson motorcycles. At the end of the war, 90,000 bikes had been shipped overseas for the war effort. These bikes were specifically designed for Army use. In 1943 the military recognized the company with an Army-Navy E Award for excellence in wartime production.
After the war, motorcycle consumers were able to turn their attention to pleasure riding again. Harley-Davidson responded to their needs with more innovations, including a new 74 cubic inch engine with hydraulic valve lifters and aluminum heads (nicknamed the Panhead). Well over 30,000 bikes were produced in 1948. The numbers continued to climb into the 1950s, which also saw the demise of Harley-Davidson's biggest competitor—Indian. It was during this decade that Harley-Davidson introduced the Sportster model and successfully added the Duo Glide model, which included hydraulic rear shock suspension.
At the end of the war, riders also created a tradition of customizing the bikes, which continued to become a trademark of the company. Customizing began when previous military Harley-Davidsons were revamped by veterans. Older versions of Harley-Davidsons were later restored, as in the company's Civilian 45 model.
By 1997 the company had annual sales of $1.8 billion, had experienced sales growth of 15 percent, and had employed 6,060 people. In the 1990s it remained the only major U.S. motorcycle manufacturer and offered 23 models of touring and custom bikes. Customers were willing to pay a substantial amount for their Harleys; a typical Harley bike cost $17,000 and took at least a year for delivery. The company captured 56.4 percent of the market for domestic super heavyweight motorcycles.
In 1997, however, it looked as if Harley-Davidson might be slipping in the market. Five years previously, Harley had commanded a market share of 71 percent, a number that it had not been able to achieve since. While Harley built its success on selling attitude, there were signs that traditional Harley customers were tiring of company attempts to sell related Harley merchandise such as golf balls, plates, and baby clothes. While Harley had successfully appealed to wealthy professionals in the 1980s and 1990s and had expanded its customer base beyond the original hard-core bikers, all these customers were aging in the 1990s. Harley produced less expensive machines, such as the $5,000 Sportster to attract younger customers, but sales of the model dropped by 19 percent in 1996. Similarly, Harley sold only 30 percent of its bikes abroad because many Europeans found the bikes too expensive.
Harley's merchandise expansion often caused dealers to take on expensive inventory that they were later forced to sell at discounted prices. Harley owners also spent lots of money paying independent repairmen or customizers to improve their bikes—money that Harley-Davidson never recouped after the sale of the bike.
Social and Economic Impact
When the Harley-Davidson partnership created their first bikes, the time was ripe in America for transportation innovations. That same year, several innovators, including Ford, Olds, Packard, and Cadillac were well into building automobiles, and the Wright brothers were taking flight for the first time. That environment inspired the Harley-Davidson founders to pursue transportation innovations to meet consumer demand.
Harley-Davidson bikes became a cult symbol, made famous by the 1960s movie Easy Rider, which featured Harley-riding characters and a glimpse into the biking culture that had already become a fixture on the West Coast. Another movie, The Wild One, which starred Marlon Brando, fixed the Harley bike culture even more firmly in the minds of Americans. Harley-Davidson bikers throughout the United States formed riding clubs and met in Sturgis, South Dakota for an annual Harley-Davidson get together.
By the 1990s, the company that Harley had cofounded had become a symbol of American culture. People from all walks of life owned and enthused over their Harley-Davidson machines, paying premium dollars for them. Though Harley's dominance may have eased in the late 1990s, the company had created an American legend with thousands of followers.
Sources of Information
Contact at: Harley-Davidson, Inc.
3700 West Juneau Ave.
Milwaukee, WI 53208
Business Phone: (414)342-4680
Bacon, Roy. The Illustrated Motorcycle Legends: Harley Davidson. Whitehorse Press, 1995.
Fucini, Joseph J. and Suzy. Entrepreneurs. Boston: G.K. & Co., 1985.
"Harley-Davidson. Background and History. Available from http://www.harley-davidson.com/company/background.html.
"Harley-Davidson, Inc." Hoover's Company Capsules, 2 June 1998.
The History of the Harley Custom (1945-1969). Available from http://www.harley-exhibition.co.uk/Pages/aboutex2.html.
Johnson, David. Family Affair: Four Men, One Dream. Cycle World, September 1993.
Machan, Dyan. "Is Hog Going Soft?" Forbes Magazine, 10 March 1997.
Neville, Lee. Database. U.S. News and World Report, 1 September 1997.
Statnekov, Daniel K. Pioneers of American Motorcycle Racing, Chapter 6. 1996. Available from http://www.roadrunner.com/maraz/lives6.html.
William S. Harley. Available from: http://www.hog.ch/News/Museum/1903...m%201903-1910/William%20Harley.htm.
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