$9.644B in 1996Grown to $18.778B in 2002Transportation specific:

$286M in 1996 Grown to $1.809B in 2002

Reporting Countries Import Statistics (Partner Country: World)

Commodity: 871150, Motorcycles With Reciprocating Piston Engine Displacing More Than 800 Cc

Calendar Year: 2005 - 2007

Reporting Country

United States Dollars % Change

Data Availability

2005 2006 2007 2007/2006

Reporting Total $ 4,917,937,740 $ 5,768,534,699 $ 6,322,601,259 9.6 01/04 - 12/07

United States $ 1,140,116,096 $ 1,484,318,869 $ 1,212,222,793 -18.33 01/95 - 06/08

Mexico $ 30,337,309 $ 30,323,841 $ 38,687,649 27.58 01/95 - 05/08

Brazil $ 19,446,919 $ 38,852,736 $ 51,417,195 32.34 01/97 - 07/08

Chile $ 2,809,515 $ 5,048,510 $ 7,809,718 54.69 01/97 - 06/08

Venezuela $ 3,151,462 $ 5,856,353 $ 9,574,030 63.48 01/99 - 12/07

Argentina $ 3,337,255 $ 5,704,210 $ 16,493,180 189.14 01/97 - 06/08

Reporting Countries Export Statistics (Partner Country: World)

Commodity: 871150, Motorcycles With Reciprocating Piston Engine Displacing More Than 800 Cc

Calendar Year: 2005 - 2007

Reporting Country

United States Dollars % Change

Data Availability

2005 2006 2007 2007/2006

Reporting Total $4,879,084,092.00 $5,757,793,503.00 $6,374,659,082.00 10.71 01/04 - 12/07

United States $ 704,063,188.00 $ 897,043,690.00 $1,125,647,531.00 25.48 01/95 - 06/08

Mexico $ 1,228,377.00 $ 151,711.00 $ 759,006.00 400.3 01/95 - 05/08

Colombia $ 67,754.00 $ - $ 59,734.00   01/95 - 04/08

Argentina $ 71,445.00 $ 23,000.00 $ 58,500.00 154.35 01/97 - 06/08

Brazil $ 34,233.00 $ 35,580.00 $ 37,449.00 5.25 01/97 - 07/08

Chile $ 5,836.00 $ 25,940.00 $ 19,803.00 -23.66 01/97 - 06/08

Venezuela $ 55,323.00 $ 31,728.00 $ 19,312.00 -39.13 01/99 - 12/07

High Inflation Ranks 95th

3.6% for consumer products Global Competitiveness

Ranks 72nd

China (34th), India (48th), and Mexico (52nd) Economic Freedom

Ranks 101st

Ranks 21st of 29 countries in Latin America

Social Disparity/Unrest Risk: Target as North American icon

  Poverty/Crime

Risk: Personnel Security

Corruption Risk: competitive disadvantage

  Presidency

Lula’s Term ends in 2010, after 8 years Stabilizing force

Chaotic Legal System Scholars often shape law; not judges. Many laws ignored or forgotten.

Poor “Ease of Doing Business” Rankings World Bank’s Doing Business 2009 Brazil 125 out of 181 for “Ease of Doing

Business.” Brazil 100 out of 181 for “Enforcing Contracts.” Brazil 111 out of 181 for “Registering

Property.”

Overcoming Challenges Obtain top-quality local legal

representation. Focus on enforcing local supplier

contracts. Vigorously enforce any possible

intellectual property infringement. Work with lobbyists to ensure passage of

pro-business laws.

Founded in 1903 in Milwaukee, WI Since beginning focused on speed and

performance James Ziemer CEO

Expert in trade relations International focus

Revenue $5.7 Billion Profit $933 Million

Global Area Corporation

Harley opens production plant in Brazil-1999 Lower import costs▪ Brazil protected domestic sales▪ Clinton Administration intervened for H-D

Export base for Latin America▪ Bikes and Merchandise

$2 million invested in Joint Venture – Izzo Motors▪ Limit risks and get local knowledge

Small Scale- 5 bikes a day

Small, affluent, macho target marketMaintain healthy joint venture

relationshipResponding to changing consumer

tastes without massive market research V-Rod

Three broad functional circles

Assists in making a collaborative and coordinated decision making

Create Demand – marketing and sales, HOG group, motorcycle styling

Produce Products – engineering, Manufacturing, cost and quality control

Provide Support – finance, HR,

Information systems, strategic planning

Combination of these three – Leadership and Strategy Council (LSC)

Organizational structure aids in increasing clarity, stimulates dialogue and trust

Eliminated an entire layer of management hierarchy – Executive VP’s

Salaried and unionized employees are involved in key business decisions

Continuous improvement involving team based efforts

Power Distance Open Door Management Policy

Long-Term Index Steady Long-Term Growth vs. “NOW” Results