Econ365 HW5 - 1 Harley Case Harley-Davidson has been losing...

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1. Harley Case Harley-Davidson has been losing its market in the U.S. due to tough competition from Japanese competitors in the 1980s. Analysts argued that Harley had inefficient production methods, poor management, and higher per-unit cost than Japanese motorcycles built in U.S. plants. In addition, Japanese motorcycles had heavy price cuts and intense product promotion due competition between Honda and Yamaha to dominate the market. In 1982, Harley faced a financial difficulty because of a recession and reduced demand, operating inefficiencies, and a massive debt problem. This translates to declines in profits, wages, and employment. Harley seek for protection from importation of heavyweight motorcycles from the U.S. government. The government implemented five-year tariff program for heavyweight motorcycles (700 cc enginges and larger) to allow Harley to eliminate its excess inventories and increase sales and production. The tariff was raised to 49.4% during the first year, then reduced to 39.4% during
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This note was uploaded on 04/20/2008 for the course ECON 365 taught by Professor Hofer during the Spring '07 term at Wisc Stevens Point.

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Econ365 HW5 - 1 Harley Case Harley-Davidson has been losing...

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