William Harley and Arthur Davidson: Men Behind the Iconic Motorcycle

New management immediately set out to improve product quality, introduce technological advances, and adopt “just-in-time” management. They started to produce bikes “as needed.”

Additionally, rather than try to compete with popular Japanese designs (flooding the US market), management decided to exploit the “retro” image of Harley-Davidson motorcycles. They started to build machines with the look and feel of earlier, signature bikes, along with customization features common to owners of that era.

By 1990, with the introduction of the so-called “Fat Boy” model, Harley-Davidson was once again the sales leader in the heavyweight (over 750 cc) motorcycle market.

“Channel Stuffing” and Fraud

Beginning in 1990 and extending into the first decade of the 21st century, Harley-Davidson’s reputation again suffered. They were accused of “channel stuffing,” a method of illegally inflating sales figures to manipulate stock prices.

As a result, in April of 2004 alone, the price of HOG (a marketing club owned by Harley-Davidson) shares dropped from $60 to under $40. To add to the deception issue, just prior to this decline, retiring Harley-Davidson CEO Jeffrey Bleustein profited $42 million by “exercising” employee stock options.

Since that time, Harley-Davidson has been named as a defendant in numerous class-action lawsuits (2004, 2007, 2011, 2022). They were filed by investors who claimed that they were intentionally defrauded by Harley-Davidson’s management.