Business Segments And Geographic Information

12 Months Ended

Dec. 31, 2014

Segment Reporting [Abstract]

Business Segments And Foreign Operations

 Reportable Segments and Geographic Information

Reportable Segments:

Harley-Davidson, Inc. is the parent company for the groups of companies doing business as Harley-Davidson Motor Company (HDMC) and Harley-Davidson Financial Services (HDFS). The Company operates in two segments: the Motorcycles & Related Products (Motorcycles) segment and the Financial Services segment. The Company’s reportable segments are strategic business units that offer different products and services and are managed separately based on the fundamental differences in their operations.

The Motorcycle reportable segment consists of HDMC which designs, manufactures and sells at wholesale street-legal Harley-Davidson motorcycles as well as a line of motorcycle parts, accessories, general merchandise and related services. The Company's products are sold to retail customers through a network of independent dealers. The Company conducts business on a global basis, with sales in North America, Europe/Middle East/Africa (EMEA), Asia-Pacific and Latin America.

The Financial Services reportable segment consists of HDFS which provides wholesale and retail financing and provides insurance and insurance-related programs primarily to Harley-Davidson dealers and their retail customers. HDFS conducts business principally in the United States and Canada.

Information by segment is set forth below for the years ended December 31 (in thousands):

	2014		2013			2012
Motorcycles net revenue	$	5,567,681	$	5,258,290		$	4,942,582
Gross profit	2,025,080		1,862,372			1,720,188
Selling, administrative and engineering expense	1,021,933		993,894			976,224
Restructuring (benefit) expense and other impairments	—		(2,131		)	28,475
Operating income from Motorcycles	$	1,003,147	$	870,609		$	715,489
Financial Services revenue	$	660,827	$	641,582		$	637,924
Financial Services expense	382,991		358,489			353,237
Operating income from Financial Services	$	277,836	$	283,093		$	284,687

Financial Services revenue includes $8.1 million, $10.4 million and $11.5 million of interest that HDMC paid to HDFS on wholesale finance receivables in 2014, 2013 and 2012, respectively. The offsetting cost of these interest incentives was recorded as a reduction to Motorcycles revenue.

Information by segment is set forth below as of December 31 (in thousands):

	Motorcycles		Financial Services		Consolidated
2014
Total assets	$	2,502,190	$	7,025,907	$	9,528,097
Depreciation	$	171,187	$	8,113	$	179,300
Capital expenditures	$	224,262	$	8,057	$	232,319
2013
Total assets	$	2,793,497	$	6,611,543	$	9,405,040
Depreciation	$	160,181	$	6,891	$	167,072
Capital expenditures	$	199,354	$	8,967	$	208,321
2012
Total assets	$	2,751,018	$	6,419,755	$	9,170,773
Depreciation	$	162,659	$	6,319	$	168,978
Capital expenditures	$	180,416	$	8,586	$	189,002

Geographic Information:

Included in the consolidated financial statements are the following amounts relating to geographic locations for the years ended December 31 (in thousands):

	2014		2013		2012
Revenue from Motorcycles(a):
United States	$	3,773,087	$	3,562,847	$	3,363,640
EMEA region	869,690		769,864		710,861
Japan	197,792		217,700		244,907
Canada	194,422		204,315		186,550
Australia	190,029		193,081		186,674
Other foreign countries	342,661		310,483		249,950
Total revenue from Motorcycles	$	5,567,681	$	5,258,290	$	4,942,582
Revenue from Financial Services(a):
United States	$	627,317	$	609,574	$	607,909
Europe	5,684		4,274		3,661
Canada	23,707		24,486		24,532
Other foreign countries	4,119		3,248		1,822
Total revenue from Financial Services	$	660,827	$	641,582	$	637,924
Long-lived assets(b):
United States	$	865,617	$	874,833	$	825,509
International	34,328		36,860		56,143
Total long-lived assets	$	899,945	$	911,693	$	881,652

(a) Revenue is attributed to geographic regions based on location of customer.

(b) Long-lived assets include all long-term assets except those specifically excluded under ASC Topic 280, “Segment Reporting,” such as deferred income taxes and finance receivables.