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Why Is Harley Davidson So Expensive? (Top 10 Reasons)

Harley Davidson

 

Motorcycle enthusiasts know that one of the top brands of quality bikes is Harley-Davidson.

The company has been making top-tier motorcycles since 1903.

Besides motorcycles, Harley-Davidson also sells merchandise and other products.

With the average price of a motorcycle costing anywhere between $11,000 and $50,000, it’s clear that buying a Harley-Davidson is quite expensive.

Here are 10 reasons Harley-Davidson motorcycles are so expensive.

 

Why Is Harley Davidson So Expensive? (Top 10 Reasons)

 

1. Brand Name

Harley Davidson logo

 

There’s no question that the brand name of Harley-Davidson adds a bit of expense to their bikes.

That’s because the company has been producing high-quality motorcycles for more than 100 years.

The company was founded in 1903 by three brothers named Davidson and a longtime friend named Harley.

It was William Harley and Arthur Davidson who first started tinkering on a new motorcycle together.

Arthur eventually brought his brothers onto the project when they realized they needed a bit more mechanical expertise.

By 1904, they had a completed bike which they entered into a race.

Their motorcycle didn’t win, but they took their lessons and moved forward with opening an official business.

By 1907, the business was officially formed and given the name Harley-Davidson.

Despite there being more Davidson brothers, they believed that Harley’s name deserved to be first since the idea for the motorcycle was originally his.

Harley was also the chief engineer of the bike.

Over time, they would produce incredible bikes that would take the world by storm.

Not only did Harley-Davidson make a name for itself in producing top-tier motorcycles, but these were bikes that looked great and performed well for a long time.

The brand tied its quality with its own culture, too.

This would become a culture of tough work and a life spent touring the roads of America.

When people buy a Harley-Davidson, they’re not just buying a motorcycle.

They’re also buying into that culture and history.

They’re joining the brand’s family.

Harley-Davidson is expensive because it made a name for itself as an expensive, top-tier, brand.

 

2. Company Growth

Harley Davidson customized

 

Harley-Davidson has slowly been redefining itself over the past few years.

To ensure the company continues to grow and expand over the next 100+ years, it has refocused itself on better defining its goals.

One of those goals is to grow the company in markets where it’s performing well.

In particular, Harley-Davidson is looking to expand in the United States, Germany, Austria, Switzerland, Japan, China, Canada, France, UK, Italy, Australia, and New Zealand.

With that sort of growth comes more operating costs.

First, Harley-Davidson has to conduct research to determine if it makes sense to build factories or stores in those countries.

It needs to determine tax laws and interest in its products.

Then it needs to establish a site for its shop or factory.

Then comes the actual building of the shop or factory.

Since they’ll be using construction resources from that specific country, construction costs could be high.

European countries especially have standards and laws in place to ensure businesses run with a focus on energy efficiency and a reduction of CO2 emissions.

That comes with added costs.

Once those factories and shops are ready, then Harley-Davidson needs to start sourcing talent.

Not only do they need blue-collar workers in the factories, but they also need those who know how to handle finances and customer service.

They need leaders.

Since they’re adding more people to their overall workforce, that adds operational costs to the company as a whole.

Because Harley-Davidson is taking on more costs, they need to have high prices on their products to cover them.

 

3. Electric Motorcycle Research

Hipster repairing wheel of motorcycle

 

While Harley-Davidson may look to its past to produce high-quality motorcycles, that isn’t keeping them from innovating for the future.

One of the ways they’re innovating is by investing in electric motorcycles.

The company understands that, one day, gas-fueled cars will be a relic of the past.

Instead of waiting for their profits to tumble, they’re spearheading the problem now by focusing on producing electric motorcycles.

In particular, they released a line of motorcycles called LiveWire.

The bikes run on electricity and help motorcyclists who want to reduce their carbon footprints live their best green lives.

There are a few reasons that this electric motorcycle research makes Harley-Davidson expensive.

For one, that sort of research doesn’t come cheap.

Not only do they need to pay top-talent engineers to design an electric motorcycle, but they also need to build prototypes.

Not all of those prototypes are going to move forward to production.

As such, the company always invests, and thus wastes, some money on their efforts.

To ensure they’re able to fund more research projects in the future, they need a high revenue stream.

Hence, the higher prices on their products.

You’ll also find that electric motorcycles are a bit more expensive than some other Harley-Davidson motorcycles because they’re limited.

The company doesn’t produce them on a large scale just yet.

That makes finding them a bit more difficult since the demand for electric vehicles is only growing.

Like any economic market, if there’s high demand and low supply, then the price of the product is going to be high.

Add all of the other factors that make Harley-Davidson expensive, and you have expensive electric bikes.

 

4. Financial Services

Insurance

 

Harley-Davidson doesn’t only sell motorcycles.

Although it started as a motorcycle company, they’ve since grown into a titan in several industries.

Merchandise, parts, and even financial services are all things that the company now offers.

It’s the company’s financial services, however, that tend to make the rest of the company a bit more expensive.

Harley-Davidson offers a few different financial services.

One of the most popular is insurance.

When you buy a bike from the company, you can also get insurance through them.

Like many other insurance companies, you’re able to pick the kind of coverage that you want.

That means you can go for a bare-bones policy that makes it legal for you to drive on the road.

You can also go for full coverage which means no matter what kind of accident happens, you’re likely going to get some help from your insurance company.

That said, insurance from Harley-Davidson isn’t the cheapest.

In one report comparing Harley-Davidson with other top insurance companies, Harley-Davidson had one of the most expensive policies.

The report showed that the sample quote they got from Progressive for motorcycle insurance was $224.

Harley-Davidson’s quote was $313.

The most expensive they found was Dairyland at $345.

While there are always factors that might make your quote more expensive or less expensive, it’s clear that Harley-Davidson charges a bit more for its insurance.

One of the reasons it’s more expensive is that Harley-Davidson isn’t an insurance company.

The bulk of its revenue comes from its motorcycle sales.

To offer insurance services to its customer, it needs to make a good amount of money on the premiums that its users pay.

This allows them to build up a pool of money that they can use to pay for medical services or other expenses when someone gets into an accident.

This also means that they need high enough profits to support their insurance business.

That translates to higher prices on their products.

 

5. Marketing Costs

marketing on laptop

 

While Harley-Davidson doesn’t need to do much marketing since word-of-mouth serves it well, it does spend a good amount of money on its marketing.

In 2019, the company spent $171.4 million on marketing.

They shaved it down a little in 2020 to $134.6 million.

Regardless, that’s a lot of money on advertising.

Harley-Davidson wants to ensure that its customers know who the best motorcycle manufacturer in the United States is.

You’ll find them sponsoring various sports and organizations.

You’ll also find them making luxury-focused commercials.

Sometimes they even include celebrity endorsements.

These ad campaigns don’t come cheap.

However, if a brand wants to stay at the top, then it has to spend a good amount of time and money to remind people why it’s the best.

Since Harley-Davidson spends a lot of money on advertising, they need to get that funding somewhere.

Their revenue likely determines how much they can spend on marketing each year.

If the company knows it wants to spend a lot of money on advertising for a particular year, it might increase prices slightly on its products.

This allows them to get a good pool of funding to spend on marketing.

Even Harley-Davidson’s existing price point affords the company plenty of revenue to spend on advertising.

 

6. Customization

Men ride Harley-Davidson motorcycle

 

While Harley-Davidson sells several different types of bikes, you can also customize certain bikes.

The company has a few models that it allows its customers to customize to their preferences.

Whether it’s changing out the seat, adding or removing accessories, or even changing the shape of the motorcycle, they give their customers a lot of power and choices.

If you choose to own a custom motorcycle, then you should expect an expensive price.

You’ll often find that a custom Harley-Davidson is more expensive than a factory-made one.

That’s because you’re essentially telling the factory how to make one specific motorcycle for yourself.

All their other bikes are produced on an assembly line.

This makes manufacturing them cost-friendly and efficient.

When you customize a motorcycle, it gets pulled off of the assembly line and has to undergo specific changes.

It’s no longer cost-friendly or efficient to make.

In fact, it costs Harley-Davidson more money to make a custom motorcycle.

That’s because they usually have to pay their workers a bit more money since it takes longer to make a custom bike.

It might also require them to buy more parts or materials to give the customer what they want.

Since it costs them more money to produce a custom motorcycle, it’s also going to cost the customer a bit more money to buy it.

While designing a custom motorcycle from Harley-Davidson can land you with the bike of your dreams, you should expect to pay an expensive price for it.

 

7. Long-Lasting

The Harley Davidson booth

 

Harley-Davidson motorcycles last a long time.

That’s why many motorcycle enthusiasts love them.

The average life expectancy of a Harley-Davidson motorcycle is 75,000 miles, according to one report.

With proper care and regular maintenance, motorcycle owners can likely make their bikes last even longer.

In fact, some Harley-Davidson motorcycles are still on the road with 100,000 miles under their belt.

Depending on how often you drive them, that can also extend how long they last.

For example, if you only drive 5,000 miles on your Harley-Davidson every year, then you’re going to get a lot of time out of it.

Harley-Davidson motorcycles have engineering and high-quality parts to thank for their longevity.

The company invests a lot of money into ensuring that its bikes come off the line at peak quality.

They use high-quality materials to ensure their bikes last a long time, too.

This adds more costs to their operations which means the price tag on that bike is going to be high, too.

It has to cover the costs and also give the company a sizable profit for its efforts.

The other reason their ability to last a long time makes Harley-Davidson motorcycles expensive is that fewer people need to buy a new motorcycle.

Since their motorcycle is still performing great, they don’t feel as much pressure to buy a new one.

Harley-Davidson ends up losing out on sales because of how great their motorcycles last.

To cover for this lack of repeat purchases, they need the initial purchase to cover their expenses for as long as possible.

The only way to do that is a more expensive price tag.

While motorcycle lovers can always buy more Harley-Davidson motorcycles to add to their collections, in most cases, they’re not buying them because their old ones broke down beyond repair.

 

8. Collector’s Item

Harley Davidson motorcycles lined up

 

Perhaps one of the biggest reasons why Harley-Davidson motorcycles are expensive is the fact that they’re collector’s items.

In most cases, someone is going to want to buy your motorcycle down the road because it fits in their collection.

Harley-Davidson releases motorcycles according to certain collections.

They give a collection a name, and then they produce a few different motorcycles that fit into the collection.

Some collections might feature the use of real leather or wood in certain parts of the bike.

Others may focus on performance.

Whatever the selling point is, Harley-Davidson will make a collection out of it.

Motorcycle enthusiasts who love to collect motorcycles for memorabilia or even to ride want to get their hands on specific bikes.

This makes motorcycles from Harley-Davidson more expensive because the company knows that collectors will one day sell their collections for even more money.

The high price point ensures that the company gets some of that money in the first place.

It also knows that, over time, some people will be selling their motorcycles to collectors.

There’s a chance that the sellers might end up selling their motorcycle for more money than they originally paid for it.

That makes buying Harley-Davidson motorcycles a good investment if you know what to look for.

Since it can make the right motorcycle owner a good amount of money, there’s a lot of demand for Harley-Davidson motorcycles.

That demand means higher prices on Harley-Davidson motorcycles.

 

9. High Resale Value

Black Harley Davidson motorcycle

 

Even if your bike isn’t technically collectible, you’re still going to sell it at a pretty high value.

It may not be quite the same as what you bought it at, but you can get back a good amount of money.

That’s because Harley-Davidson motorcycles have a high resale value.

Part of the reason they sell so high is because of their ability to last and run a long time.

As long as you take care of it, you can sell your Harley-Davidson for almost new.

This makes Harley-Davidson motorcycles expensive for a few reasons.

The first is that you don’t really get any savings when it comes to buying a Harley-Davidson motorcycle.

A used Harley-Davidson is only going to be a bit cheaper than a brand new one.

In most cases, it’s still going to be expensive.

Secondly, Harley-Davidson also knows that people are going to be reselling their motorcycles at high values.

To get the most out of the original sale, they put their prices rather high.

 

10. Made In America

Harley Davidson custom on display

 

A final reason Harley-Davidson is expensive has to do with the fact that they’re made in America.

According to CNN, Harley-Davidson has a few plants in the United States.

These factories put together the various parts and assemble the motorcycle.

While those parts often come from other countries, which help shave down costs, it’s still American citizens putting the motorcycle together.

American workers get paid more than workers in some other countries.

They also get benefits like health insurance coverage.

Harley-Davidson has to pay higher operating costs to pay their workers and the various benefits that they offer.

Since their operating costs are higher by employing American workers, they have to sell at higher prices to generate a profit.

 

Conclusion

Harley-Davidson motorcycles are a premium brand of motorcycles.

With prices sometimes surpassing the cost of a car, it’s clear that the brand is expensive.

Everything from its operating costs to its collectibility makes Harley-Davidson motorcycles expensive.


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