10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D. C. 20549

FORM 10-Q

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 28, 2015

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                     to                    

Commission file number 1-9183

Harley-Davidson, Inc.

(Exact name of registrant as specified in its charter)

Wisconsin	39-1382325
(State of organization)	(I.R.S. Employer Identification No.)
3700 West Juneau Avenue Milwaukee, Wisconsin	53208
(Address of principal executive offices)	(Zip code)

Registrants telephone number: (414) 342-4680

None

(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such requirements for the past 90 days.    Yes  x    No  ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  x   No   ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	x	Accelerated filer	¨
Non-accelerated filer	¨	Smaller reporting company	¨

Indicate by check mark whether the registrant is a shell company as defined in Rule 12b-2 of the Exchange Act.    Yes  ¨    No  x

Number of shares of the registrant’s common stock outstanding at July 31, 2015: 205,966,792 shares

Harley-Davidson, Inc.

Form 10-Q

For The Quarter Ended June 28, 2015

Part I	Financial Information	3
Item 1.	Financial Statements	3
	Condensed Consolidated Statements of Income	3
	Condensed Consolidated Statements of Comprehensive Income	4
	Condensed Consolidated Balance Sheets	5
	Condensed Consolidated Statements of Cash Flows	7
	Notes to Condensed Consolidated Financial Statements	8
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	38
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	57
Item 4.	Controls and Procedures	58
Part II	Other Information	59
Item 1.	Legal Proceedings	59
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	59
Item 6.	Exhibits	60
Signatures		61

PART I – FINANCIAL INFORMATION

Item 1. Financial Statements

HARLEY-DAVIDSON, INC.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(In thousands, except per share amounts)

(Unaudited)

	Three months ended				Six months ended
	June 28, 2015		June 29, 2014		June 28, 2015		June 29, 2014
Revenue:
Motorcycles and Related Products	$	1,650,783	$	1,834,285	$	3,161,353	$	3,405,973
Financial Services	173,609		166,414		335,984		320,774
Total revenue	1,824,392		2,000,699		3,497,337		3,726,747
Costs and expenses:
Motorcycles and Related Products cost of goods sold	1,003,569		1,110,146		1,923,864		2,089,703
Financial Services interest expense	41,188		40,741		79,724		79,598
Financial Services provision for credit losses	15,175		15,961		41,422		36,292
Selling, administrative and engineering expense	301,944		286,156		579,693		562,577
Total costs and expenses	1,361,876		1,453,004		2,624,703		2,768,170
Operating income	462,516		547,695		872,634		958,577
Investment income	1,450		1,772		2,772		3,431
Interest expense	9		393		18		4,070
Income before provision for income taxes	463,957		549,074		875,388		957,938
Provision for income taxes	164,147		194,921		305,724		337,868
Net income	$	299,810	$	354,153	$	569,664	$	620,070
Earnings per common share:
Basic	$	1.44	$	1.63	$	2.72	$	2.84
Diluted	$	1.44	$	1.62	$	2.71	$	2.82
Cash dividends per common share	$	0.310	$	0.275	$	0.620	$	0.550

The accompanying notes are an integral part of the consolidated financial statements.

3

HARLEY-DAVIDSON, INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(In thousands)

(Unaudited)

	Three months ended						Six months ended
	June 28, 2015			June 29, 2014			June 28, 2015			June 29, 2014
Net income	$	299,810		$	354,153		$	569,664		$	620,070
Other comprehensive (loss) income, net of tax
Foreign currency translation adjustments	4,251			5,733			(22,770		)	8,681
Derivative financial instruments	(13,286		)	3,150			(2,214		)	2,923
Marketable securities	(128		)	(74		)	(195		)	(116		)
Pension and postretirement benefit plans	8,798			6,069			17,596			12,137
Total other comprehensive (loss) income, net of tax	$	(365	)	$	14,878		$	(7,583	)	$	23,625
Comprehensive income	$	299,445		$	369,031		$	562,081		$	643,695

The accompanying notes are an integral part of the consolidated financial statements.

4

HARLEY-DAVIDSON, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands)

	(Unaudited)						(Unaudited)
	June 28, 2015			December 31, 2014			June 29, 2014
ASSETS
Current assets:
Cash and cash equivalents	$	1,247,579		$	906,680		$	999,346
Marketable securities	52,516			57,325			57,814
Accounts receivable, net	277,569			247,621			289,940
Finance receivables, net	2,331,723			1,916,635			2,281,512
Inventories	395,044			448,871			371,597
Restricted cash	136,760			98,627			154,681
Deferred income taxes	94,778			89,916			90,348
Other current assets	160,421			182,420			128,460
Total current assets	4,696,390			3,948,095			4,373,698
Finance receivables, net	4,816,772			4,516,246			4,537,405
Property, plant and equipment, net	873,007			883,077			826,467
Prepaid pension costs	—			—			256,279
Goodwill	26,105			27,752			30,252
Deferred income taxes	66,755			77,835			2,915
Other long-term assets	85,843			75,092			49,280
	$	10,564,872		$	9,528,097		$	10,076,296
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	407,636		$	196,868		$	388,342
Accrued liabilities	448,737			449,317			500,769
Short-term debt	114,983			731,786			619,622
Current portion of long-term debt	1,551,368			1,011,315			944,915
Total current liabilities	2,522,724			2,389,286			2,453,648
Long-term debt	4,560,349			3,761,528			3,794,396
Pension liability	66,786			76,186			38,174
Postretirement healthcare liability	196,369			203,006			209,312
Deferred income taxes	—			—			38,919
Other long-term liabilities	195,017			188,805			175,587
Commitments and contingencies (Note 16)
Shareholders’ equity:
Preferred stock, none issued	—			—			—
Common stock	3,448			3,442			3,439
Additional paid-in-capital	1,304,855			1,265,257			1,231,913
Retained earnings	8,898,959			8,459,040			8,352,168
Accumulated other comprehensive loss	(522,526		)	(514,943		)	(309,051		)
Treasury stock, at cost	(6,661,109		)	(6,303,510		)	(5,912,209		)
Total shareholders' equity	3,023,627			2,909,286			3,366,260
	$	10,564,872		$	9,528,097		$	10,076,296

5

HARLEY-DAVIDSON, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS (continued)

(In thousands)

	(Unaudited)				(Unaudited)
	June 28, 2015		December 31, 2014		June 29, 2014
Balances held by consolidated variable interest entities (Note 5)
Current finance receivables, net	$	409,198	$	312,645	$	359,085
Other assets	$	3,067	$	3,409	$	2,521
Non-current finance receivables, net	$	1,740,420	$	1,113,801	$	1,495,171
Restricted cash - current and non-current	$	149,418	$	110,017	$	141,146
Current portion of long-term debt	$	462,008	$	366,889	$	403,891
Long-term debt	$	1,555,071	$	904,644	$	1,308,964

The accompanying notes are an integral part of the consolidated financial statements.

6

HARLEY-DAVIDSON, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

	Six months ended
	June 28, 2015			June 29, 2014
Net cash provided by operating activities (Note 3)	$	613,944		$	570,592
Cash flows from investing activities:
Capital expenditures	(85,180		)	(74,523		)
Origination of finance receivables	(1,976,563		)	(1,904,577		)
Collections on finance receivables	1,570,431			1,518,186
Sales and redemptions of marketable securities	4,500			41,010
Other	5,111			145
Net cash used by investing activities	(481,701		)	(419,759		)
Cash flows from financing activities:
Repayments of senior unsecured notes	—			(303,000		)
Proceeds from issuance of medium-term notes	595,386			—
Repayments of medium-term notes	—			(7,220		)
Proceeds from securitization debt	1,195,668			847,126
Repayments of securitization debt	(454,332		)	(393,655		)
Net decrease in credit facilities and unsecured commercial paper	(616,586		)	(48,134		)
Borrowings of asset-backed commercial paper	40,209			36,800
Repayments of asset-backed commercial paper	(35,730		)	(37,317		)
Net change in restricted cash	(40,159		)	(9,874		)
Dividends paid	(129,745		)	(120,631		)
Purchase of common stock for treasury	(358,425		)	(223,736		)
Excess tax benefits from share-based payments	2,401			8,652
Issuance of common stock under employee stock option plans	15,664			27,907
Net cash provided by (used by) financing activities	214,351			(223,082		)
Effect of exchange rate changes on cash and cash equivalents	(5,695		)	4,983
Net increase (decrease) in cash and cash equivalents	$	340,899		$	(67,266	)
Cash and cash equivalents:
Cash and cash equivalents—beginning of period	$	906,680		$	1,066,612
Net increase (decrease) in cash and cash equivalents	340,899			(67,266		)
Cash and cash equivalents—end of period	$	1,247,579		$	999,346

The accompanying notes are an integral part of the consolidated financial statements.

7

HARLEY-DAVIDSON, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

1. Basis of Presentation and Use of Estimates

The condensed consolidated financial statements include the accounts of Harley-Davidson, Inc. and its wholly-owned subsidiaries (the Company), including the accounts of the groups of companies doing business as Harley-Davidson Motor Company (HDMC) and Harley-Davidson Financial Services (HDFS). In addition, certain variable interest entities (VIEs) related to secured financing are consolidated as the Company is the primary beneficiary. All intercompany accounts and material intercompany transactions are eliminated.

In the opinion of management, the accompanying unaudited condensed consolidated financial statements contain all adjustments (consisting only of normal recurring adjustments) necessary to present fairly the condensed consolidated balance sheets as of June 28, 2015 and June 29, 2014, the condensed consolidated statements of income for the three and six month periods then ended, the condensed consolidated statements of comprehensive income for the three and six month periods then ended and the condensed consolidated statements of cash flows for the six month periods then ended.

Certain information and footnote disclosures normally included in complete financial statements have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission (SEC) and U.S. generally accepted accounting principles (U.S. GAAP) for interim financial reporting. These condensed consolidated financial statements should be read in conjunction with the audited financial statements and notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2014.

The Company operates in two principal reportable segments: Motorcycles & Related Products (Motorcycles) and Financial Services.

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and the accompanying notes. Actual results could differ from those estimates.

2. New Accounting Standards

Accounting Standards Not Yet Adopted

In May 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2014-09 Revenue from Contracts with Customers (ASU No. 2014-09). ASU No. 2014-09 is a comprehensive new revenue recognition model that requires a company to recognize revenue to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. In July 2015, the FASB decided to defer the effective date of the new revenue recognition standard by one year to fiscal years beginning after December 15, 2017 and for interim periods therein. The Company is currently evaluating the impact of adoption.

In February 2015, the FASB issued ASU No. 2015-02 Amendments to the Consolidation Analysis (ASU 2015-02). ASU No. 2015-02 amends the guidance within Accounting Standards Codification (ASC) Topic 810, "Consolidation,” to change the analysis that a reporting entity must perform to determine whether it should consolidate certain legal entities. The Company is required to adopt ASU No, 2015-02 for fiscal years, and for interim periods within those fiscal years, beginning after December 15, 2015. The Company believes the adoption of ASU No. 2015-02 will not have an impact on its financial results and will only impact the content of the current disclosure.

In April 2015, the FASB issued ASU No. 2015-03 Simplifying the Presentation of Debt Issuance Costs (ASU 2015-03). ASU No. 2015-03 amends the guidance within ASC Topic 835, "Interest", to require that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt premiums and discounts. The Company is required to adopt ASU No, 2015-03 for fiscal years, and for interim periods within those fiscal years, beginning after December 15, 2015 on a retrospective basis. Upon adoption, the Company will reclassify its debt issuance costs from other assets to debt on the balance sheet. At June 28, 2015, the Company had $18.4 million of debt issuance costs recorded as assets on the balance sheet.

8

3. Additional Balance Sheet and Cash Flow Information

Marketable Securities

The Company’s marketable securities consisted of the following (in thousands):

	June 28, 2015		December 31, 2014		June 29, 2014
Available-for-sale: Corporate bonds	$	52,516	$	57,325	$	57,814
Trading securities: Mutual funds	37,698		33,815		33,567
	$	90,214	$	91,140	$	91,381

The Company’s available-for-sale securities are carried at fair value with any unrealized gains or losses reported in other comprehensive income. During the first half of 2015 and 2014, the Company recognized gross unrealized losses of approximately $310,000 and $184,000, respectively, or $195,000 and $116,000 net of taxes, respectively, to adjust amortized cost to fair value. The marketable securities have contractual maturities that generally come due over the next 3 to 22 months.

The Company's trading securities relate to investments held by the Company to fund certain deferred compensation obligations. The trading securities are carried at fair value with gains and losses recorded in net income and investments are included in other long-term assets on the consolidated balance sheets.

Inventories

Inventories are valued at the lower of cost or market. Substantially all inventories located in the United States are valued using the last-in, first-out (LIFO) method. Other inventories are valued at the lower of cost or market using the first-in, first-out (FIFO) method. Inventories consist of the following (in thousands):

	June 28, 2015			December 31, 2014			June 29, 2014
Components at the lower of FIFO cost or market
Raw materials and work in process	$	137,151		$	151,254		$	118,720
Motorcycle finished goods	186,326			230,309			179,314
Parts and accessories and general merchandise	121,469			117,210			122,289
Inventory at lower of FIFO cost or market	444,946			498,773			420,323
Excess of FIFO over LIFO cost	(49,902		)	(49,902		)	(48,726		)
	$	395,044		$	448,871		$	371,597

9

Operating Cash Flow

The reconciliation of net income to net cash provided by operating activities is as follows (in thousands):

	Six months ended
	June 28, 2015			June 29, 2014
Cash flows from operating activities:
Net income	$	569,664		$	620,070
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation	93,640			87,123
Amortization of deferred loan origination costs	47,524			45,713
Amortization of financing origination fees	4,820			4,284
Provision for employee long-term benefits	24,635			16,854
Contributions to pension and postretirement plans	(12,725		)	(14,035		)
Stock compensation expense	16,734			20,768
Net change in wholesale finance receivables related to sales	(418,969		)	(510,200		)
Provision for credit losses	41,422			36,292
Loss on debt extinguishment	—			1,145
Deferred income taxes	(1,195		)	(3,894		)
Foreign currency adjustments	11,041			(5,084		)
Other, net	(1,964		)	9,332
Changes in current assets and liabilities:
Accounts receivable, net	(43,309		)	(25,643		)
Finance receivables—accrued interest and other	(270		)	(993		)
Inventories	38,012			58,741
Accounts payable and accrued liabilities	232,357			226,233
Derivative instruments	1,185			968
Other	11,342			2,918
Total adjustments	44,280			(49,478		)
Net cash provided by operating activities	$	613,944		$	570,592

4. Finance Receivables

The Company provides retail financial services to customers of the Company’s independent dealers in the United States and Canada. The origination of retail loans is a separate and distinct transaction between the Company and the retail customer, unrelated to the Company’s sale of product to its dealers. Retail finance receivables consist of secured promissory notes and secured installment sales contracts. The Company holds either titles or liens on titles to vehicles financed by promissory notes and installment sales contracts.

The Company offers wholesale financing to the Company’s independent dealers. Wholesale loans to dealers are generally secured by financed inventory or property and are originated in the U.S. and Canada.

Finance receivables, net, consisted of the following (in thousands):

	June 28, 2015			December 31, 2014			June 29, 2014
Retail	$	5,962,685		$	5,607,924		$	5,603,187
Wholesale	1,325,041			952,321			1,338,085
	7,287,726			6,560,245			6,941,272
Allowance for credit losses	(139,231		)	(127,364		)	(122,355		)
	$	7,148,495		$	6,432,881		$	6,818,917

10

A provision for credit losses on finance receivables is charged or credited to earnings in amounts that the Company believes are sufficient to maintain the allowance for credit losses at a level that is adequate to cover losses of principal inherent in the existing portfolio. The allowance for credit losses represents management’s estimate of probable losses inherent in the finance receivable portfolio as of the balance sheet date. However, due to the use of projections and assumptions in estimating the losses, the amount of losses actually incurred by the Company could differ from the amounts estimated.

Changes in the allowance for credit losses on finance receivables by portfolio were as follows (in thousands):

	Three months ended June 28, 2015
	Retail			Wholesale			Total
Balance, beginning of period	$	123,777		$	9,043		$	132,820
Provision for credit losses	16,890			(1,715		)	15,175
Charge-offs	(21,003		)	—			(21,003		)
Recoveries	12,239			—			12,239
Balance, end of period	$	131,903		$	7,328		$	139,231
	Three months ended June 29, 2014
	Retail			Wholesale			Total
Balance, beginning of period	$	106,776		$	7,753		$	114,529
Provision for credit losses	16,258			(297		)	15,961
Charge-offs	(19,018		)	—			(19,018		)
Recoveries	10,883			—			10,883
Balance, end of period	$	114,899		$	7,456		$	122,355
	Six months ended June 28, 2015
	Retail			Wholesale			Total
Balance, beginning of period	$	122,025		$	5,339		$	127,364
Provision for credit losses	39,433			1,989			41,422
Charge-offs	(53,736		)	—			(53,736		)
Recoveries	24,181			—			24,181
Balance, end of period	$	131,903		$	7,328		$	139,231
	Six months ended June 29, 2014
	Retail			Wholesale			Total
Balance, beginning of period	$	106,063		$	4,630		$	110,693
Provision for credit losses	33,466			2,826			36,292
Charge-offs	(46,361		)	—			(46,361		)
Recoveries	21,731			—			21,731
Balance, end of period	$	114,899		$	7,456		$	122,355

Finance receivables are considered impaired when management determines it is probable that the Company will be unable to collect all amounts due according to the terms of the loan agreement. Portions of the allowance for credit losses are established to cover estimated losses on finance receivables specifically identified for impairment. The unspecified portion of the allowance for credit losses covers estimated losses on finance receivables which are collectively reviewed for impairment.

The retail portfolio primarily consists of a large number of small balance, homogeneous finance receivables. The Company performs a periodic and systematic collective evaluation of the adequacy of the retail allowance for credit losses. The Company utilizes loss forecast models which consider a variety of factors including, but not limited to, historical loss trends, origination or vintage analysis, known and inherent risks in the portfolio, the value of the underlying collateral, recovery rates, and current economic conditions including items such as unemployment rates. Retail finance receivables are not evaluated individually for impairment prior to charge-off and therefore are not reported as impaired loans.

The wholesale portfolio is primarily composed of large balance, non-homogeneous loans. The Company’s evaluation for the wholesale allowance for credit losses is first based on a loan-by-loan review. A specific allowance for credit losses is established for wholesale finance receivables determined to be individually impaired when management concludes that the

11

borrower will not be able to make full payment of the contractual amounts due based on the original terms of the loan agreement. The impairment is determined based on the cash that the Company expects to receive discounted at the loan’s original interest rate or the fair value of the collateral, if the loan is collateral-dependent. Finance receivables in the wholesale portfolio that are not considered impaired on an individual basis are segregated, based on similar risk characteristics, according to the Company’s internal risk rating system and collectively evaluated for impairment. The related allowance for credit losses is based on factors such as the specific borrower’s financial performance and ability to repay, the Company’s past loan loss experience, current economic conditions, and the value of the underlying collateral.

Generally, it is the Company’s policy not to change the terms and conditions of finance receivables. However, to minimize the economic loss, the Company may modify certain finance receivables in troubled debt restructurings. Total restructured finance receivables are not significant.

The allowance for credit losses and finance receivables by portfolio, segregated by those amounts that are individually evaluated for impairment and those that are collectively evaluated for impairment, was as follows (in thousands):

	June 28, 2015
	Retail		Wholesale		Total
Allowance for credit losses, ending balance:
Individually evaluated for impairment	$	—	$	—	$	—
Collectively evaluated for impairment	131,903		7,328		139,231
Total allowance for credit losses	$	131,903	$	7,328	$	139,231
Finance receivables, ending balance:
Individually evaluated for impairment	$	—	$	—	$	—
Collectively evaluated for impairment	5,962,685		1,325,041		7,287,726
Total finance receivables	$	5,962,685	$	1,325,041	$	7,287,726
	December 31, 2014
	Retail		Wholesale		Total
Allowance for credit losses, ending balance:
Individually evaluated for impairment	$	—	$	—	$	—
Collectively evaluated for impairment	122,025		5,339		127,364
Total allowance for credit losses	$	122,025	$	5,339	$	127,364
Finance receivables, ending balance:
Individually evaluated for impairment	$	—	$	—	$	—
Collectively evaluated for impairment	5,607,924		952,321		6,560,245
Total finance receivables	$	5,607,924	$	952,321	$	6,560,245
	June 29, 2014
	Retail		Wholesale		Total
Allowance for credit losses, ending balance:
Individually evaluated for impairment	$	—	$	—	$	—
Collectively evaluated for impairment	114,899		7,456		122,355
Total allowance for credit losses	$	114,899	$	7,456	$	122,355
Finance receivables, ending balance:
Individually evaluated for impairment	$	—	$	—	$	—
Collectively evaluated for impairment	5,603,187		1,338,085		6,941,272
Total finance receivables	$	5,603,187	$	1,338,085	$	6,941,272

There were no wholesale finance receivables at June 28, 2015, December 31, 2014, or June 29, 2014 that were individually deemed to be impaired under ASC Topic 310, “Receivables.”

Retail finance receivables are contractually delinquent if the minimum payment is not received by the specified due date. Retail finance receivables are generally charged-off when the receivable is 120 days or more delinquent, the related asset is repossessed or the receivable is otherwise deemed uncollectible. All retail finance receivables accrue interest until either

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collected or charged-off. Accordingly, as of June 28, 2015, December 31, 2014 and June 29, 2014, all retail finance receivables were accounted for as interest-earning receivables, of which $18.3 million, $28.7 million and $14.7 million, respectively, were 90 days or more past due.

Wholesale finance receivables are delinquent if the minimum payment is not received by the contractual due date. Interest continues to accrue on past due finance receivables until the date the finance receivable becomes uncollectible and the finance receivable is placed on non-accrual status. The Company will resume accruing interest on these accounts when payments are current according to the terms of the loans and future payments are reasonably assured. While on non-accrual status, all cash received is applied to principal or interest as appropriate. Wholesale finance receivables are written down once management determines that the specific borrower does not have the ability to repay the loan in full. There were no wholesale receivables on non-accrual status at June 28, 2015, December 31, 2014 or June 29, 2014. At June 28, 2015, December 31, 2014 and June 29, 2014, $0.2 million, $0.2 million, and $0.03 million of wholesale finance receivables were 90 days or more past due and accruing interest, respectively.

An analysis of the aging of past due finance receivables was as follows (in thousands):

	June 28, 2015
	Current		31-60 Days Past Due		61-90 Days Past Due		Greater than 90 Days Past Due		Total Past Due		Total Finance Receivables
Retail	$	5,819,279	$	96,982	$	28,150	$	18,274	$	143,406	$	5,962,685
Wholesale	1,324,174		513		181		173		867		1,325,041
Total	$	7,143,453	$	97,495	$	28,331	$	18,447	$	144,273	$	7,287,726
	December 31, 2014
	Current		31-60 Days Past Due		61-90 Days Past Due		Greater than 90 Days Past Due		Total Past Due		Total Finance Receivables
Retail	$	5,427,719	$	113,007	$	38,486	$	28,712	$	180,205	$	5,607,924
Wholesale	951,660		383		72		206		661		952,321
Total	$	6,379,379	$	113,390	$	38,558	$	28,918	$	180,866	$	6,560,245
	June 29, 2014
	Current		31-60 Days Past Due		61-90 Days Past Due		Greater than 90 Days Past Due		Total Past Due		Total Finance Receivables
Retail	$	5,469,796	$	90,617	$	28,088	$	14,686	$	133,391	$	5,603,187
Wholesale	1,337,437		501		113		34		648		1,338,085
Total	$	6,807,233	$	91,118	$	28,201	$	14,720	$	134,039	$	6,941,272

A significant part of managing the Company's finance receivable portfolios includes the assessment of credit risk associated with each borrower. As the credit risk varies between the retail and wholesale portfolios, the Company utilizes different credit risk indicators for each portfolio.

The Company manages retail credit risk through its credit approval policy and ongoing collection efforts. The Company uses FICO scores, a standard credit rating measurement, to differentiate the expected default rates of retail credit applicants enabling the Company to better evaluate credit applicants for approval and to tailor pricing according to this assessment. Retail loans with a FICO score of 640 or above at origination are considered prime, and loans with a FICO score below 640 are considered sub-prime. These credit quality indicators are determined at the time of loan origination and are not updated subsequent to the loan origination date.

The recorded investment of retail finance receivables, by credit quality indicator, was as follows (in thousands):

	June 28, 2015		December 31, 2014		June 29, 2014
Prime	$	4,718,363	$	4,435,352	$	4,407,364
Sub-prime	1,244,322		1,172,572		1,195,823
Total	$	5,962,685	$	5,607,924	$	5,603,187

The Company's credit risk on the wholesale portfolio is different from that of the retail portfolio. Whereas the retail portfolio represents a relatively homogeneous pool of retail finance receivables that exhibit more consistent loss patterns, the

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wholesale portfolio exposures are less consistent. The Company utilizes an internal credit risk rating system to manage credit risk exposure consistently across wholesale borrowers and individually evaluates credit risk factors for each borrower.

The Company uses the following internal credit quality indicators, based on an internal risk rating system, listed from highest level of risk to lowest level of risk for the wholesale portfolio: Doubtful, Substandard, Special Mention, Medium Risk and Low Risk. Based upon management’s review, the dealers classified in the Doubtful category are the dealers with the greatest likelihood of being charged off, while the dealers classified as Low Risk are least likely to be charged off. The internal rating system considers factors such as the specific borrowers’ ability to repay and the estimated value of any collateral. Dealer risk rating classifications are reviewed and updated on a quarterly basis.

The recorded investment of wholesale finance receivables, by internal credit quality indicator, was as follows (in thousands):

	June 28, 2015		December 31, 2014		June 29, 2014
Doubtful	$	—	$	954	$	4,916
Substandard	7,739		7,025		4,192
Special Mention	15,343		—		—
Medium Risk	3,245		11,557		16,202
Low Risk	1,298,714		932,785		1,312,775
Total	$	1,325,041	$	952,321	$	1,338,085

5. Asset-Backed Financing

The Company participates in asset-backed financing through both term asset-backed securitization transactions and through asset-backed commercial paper conduit facilities. The Company treats these transactions as secured borrowings because either they are transferred to consolidated variable interest entities (VIEs) or the Company maintains effective control over the assets and does not meet the accounting sale requirements under ASC Topic 860, "Transfers and Servicing" (ASC Topic 860). In the Company's asset-backed financing programs, the Company transfers retail motorcycle finance receivables to special purpose entities (SPE), which are considered VIEs under U.S. GAAP. Each SPE then converts those assets into cash, through the issuance of debt.

The Company is required to consolidate any VIE in which it is deemed to be the primary beneficiary through having power over the significant activities of the entity and having an obligation to absorb losses or the right to receive benefits from the VIE which are potentially significant to the VIE. The Company is considered to have the power over the significant activities of its term asset-backed securitization and asset-backed U.S. commercial paper conduit facility VIEs due to its role as servicer. Servicing fees are typically not considered potentially significant variable interests in a VIE. However, the Company retains a residual interest in the VIEs in the form of a debt security, which gives the Company the right to receive benefits that could be potentially significant to the VIE. Therefore, the Company is the primary beneficiary and consolidates all of these VIEs within its consolidated financial statements.

The Company is not the primary beneficiary of the asset-backed Canadian commercial paper conduit facility VIE; therefore, the Company does not consolidate this VIE. However, the Company treats the conduit facility as a secured borrowing as it maintains effective control over the assets transferred to the VIE and therefore does not meet the requirements for sale accounting under ASC Topic 860. As such, the Company retains the transferred assets and the related debt within its Consolidated Balance Sheet.

Servicing fees paid by VIEs to the Company are eliminated in consolidation and therefore are not recorded on a consolidated basis. The Company is not required, and does not currently intend, to provide any additional financial support to its VIEs. Investors and creditors only have recourse to the assets held by the VIEs.

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The following table shows the assets and liabilities related to the asset-backed financings that were included in the financial statements (in thousands):

	June 28, 2015
	Finance receivables		Allowance for credit losses			Restricted cash		Other assets		Total assets		Asset-backed debt
On-balance sheet assets and liabilities
Consolidated VIEs
Term asset-backed securitizations	$	2,199,018	$	(49,400	)	$	149,418	$	2,857	$	2,301,893	$	2,017,079
Asset-backed U.S. commercial paper conduit facility	—		—			—		210		210		—
Unconsolidated VIEs
Asset-backed Canadian commercial paper conduit facility	176,730		(2,657		)	12,793		340		187,206		160,940
Total on-balance sheet assets and liabilities	$	2,375,748	$	(52,057	)	$	162,211	$	3,407	$	2,489,309	$	2,178,019
	December 31, 2014
	Finance receivables		Allowance for credit losses			Restricted cash		Other assets		Total assets		Asset-backed debt
On-balance sheet assets and liabilities
Consolidated VIEs
Term asset-backed securitizations	$	1,458,602	$	(32,156	)	$	110,017	$	2,987	$	1,539,450	$	1,271,533
Asset-backed U.S. commercial paper conduit facility	—		—			—		422		422		—
Unconsolidated VIEs
Asset-backed Canadian commercial paper conduit facility	185,099		(2,965		)	12,035		262		194,431		166,912
Total on-balance sheet assets and liabilities	$	1,643,701	$	(35,121	)	$	122,052	$	3,671	$	1,734,303	$	1,438,445
	June 29, 2014
	Finance receivables		Allowance for credit losses			Restricted cash		Other assets		Total assets		Asset-backed debt
On-balance sheet assets and liabilities
Consolidated VIEs
Term asset-backed securitizations	$	1,893,585	$	(39,329	)	$	141,146	$	2,342	$	1,997,744	$	1,712,855
Asset-backed U.S. commercial paper conduit facility	—		—			—		179		179		—
Unconsolidated VIEs
Asset-backed Canadian commercial paper conduit facility	203,800		(3,235		)	13,535		240		214,340		173,224
Total on-balance sheet assets and liabilities	$	2,097,385	$	(42,564	)	$	154,681	$	2,761	$	2,212,263	$	1,886,079

Term Asset-Backed Securitization VIEs

The Company transfers U.S. retail motorcycle finance receivables to SPEs which in turn issue secured notes to investors, with various maturities and interest rates, secured by future collections of the purchased U.S. retail motorcycle finance receivables. Each term asset-backed securitization SPE is a separate legal entity and the U.S. retail motorcycle finance receivables included in the term asset-backed securitizations are only available for payment of the secured debt and other obligations arising from the term asset-backed securitization transaction and are not available to pay other obligations or claims of the Company’s creditors until the associated secured debt and other obligations are satisfied. Restricted cash balances held by the SPEs are used only to support the securitizations. There are no amortization schedules for the secured notes; however, the debt is reduced monthly as available collections on the related U.S. retail motorcycle finance receivables are applied to outstanding principal. The secured notes’ contractual lives have various maturities ranging from 2015 to 2022.

During the second quarter of 2015, the Company issued $500.0 million of secured notes through one term asset-backed securitization transaction. The Company also issued $700.0 million of secured notes through one term asset-backed securitization transaction during the first quarter of 2015. During the second quarter of 2014, the Company issued $850.0

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million of secured notes through one term asset-backed securitization transaction. There were no other term asset-backed securitization transactions during the six months ended June 29, 2014.

Asset-Backed U.S. Commercial Paper Conduit Facility VIE

In September 2014, the Company amended and restated its facility (U.S. Conduit) with a third-party bank sponsored asset-backed commercial paper conduit, which provides for a total aggregate commitment of $600.0 million based on, among other things, the amount of eligible U.S. retail motorcycle loans held by a SPE as collateral. Under the facility, the Company may transfer U.S. retail motorcycle finance receivables to a SPE, which in turn may issue debt to third-party bank-sponsored asset-backed commercial paper conduits.

The assets of the SPE are restricted as collateral for the payment of the debt or other obligations arising in the transaction and are not available to pay other obligations or claims of the Company’s creditors. The terms for this debt provide for interest on the outstanding principal generally based on prevailing commercial paper rates plus a program fee based on outstanding principal, or LIBOR plus a specified margin to the extent the advance is not funded by a conduit lender through the issuance of commercial paper. The U.S. Conduit also provides for an unused commitment fee based on the unused portion of the total aggregate commitment of $600.0 million. There is no amortization schedule; however, the debt is reduced monthly as available collections on the related finance receivables are applied to outstanding principal. Upon expiration of the U.S. Conduit, any outstanding principal will continue to be reduced monthly through available collections. Unless earlier terminated or extended by mutual agreement of the Company and the lenders, the U.S. Conduit has an expiration date of October 30, 2015.

The SPE had no borrowings outstanding under the U.S. Conduit at June 28, 2015, December 31, 2014 or June 29, 2014; therefore, U.S. Conduit assets are restricted as collateral for the payment of fees associated with the unused portion of the total aggregate commitment.

Asset-Backed Canadian Commercial Paper Conduit Facility

In June 2014, the Company amended its facility agreement (Canadian Conduit) with a Canadian bank-sponsored asset-backed commercial paper conduit. Under the agreement, the Canadian Conduit is contractually committed, at the Company's option, to purchase eligible Canadian retail motorcycle finance receivables for proceeds up to C$200.0 million. The transferred assets are restricted as collateral for the payment of the debt. The terms for this debt provide for interest on the outstanding principal based on prevailing market interest rates plus a specified margin. The Canadian Conduit also provides for a program fee and an unused commitment fee based on the unused portion of the total aggregate commitment of C$200.0 million. There is no amortization schedule; however, the debt is reduced monthly as available collections on the related finance receivables are applied to outstanding principal. Upon expiration of the Canadian Conduit, any outstanding principal will continue to be reduced monthly through available collections. Unless earlier terminated or extended by mutual agreement of the Company and the lenders, as of June 28, 2015, the Canadian Conduit had an expiration date of June 30, 2015. The Canadian Conduit was renewed on June 30, 2015 with similar terms and a borrowing amount of up to C$240.0 million with an expiration date of June 30, 2016. The contractual maturity of the debt is approximately 5 years.

As the Company participates in and does not consolidate the Canadian bank-sponsored, multi-seller conduit VIE, the maximum exposure to loss associated with this VIE, which would only be incurred in the unlikely event that all the finance receivables and underlying collateral have no residual value, was $26.3 million at June 28, 2015. The maximum exposure is not an indication of the Company's expected loss exposure.

During the second and first quarters of 2015, the Company transferred $26.8 million and $19.2 million of Canadian retail motorcycle finance receivables to the Canadian Conduit for proceeds of $23.4 million and $16.8 million, respectively. During the second and first quarters of 2014, HDFS transferred $26.4 million and $15.7 million of Canadian retail motorcycle finance receivables to the Canadian Conduit for proceeds of $23.1 million and $13.8 million, respectively. The transferred assets are restricted as collateral for the payment of the debt.

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6. Fair Value Measurements

Certain assets and liabilities are recorded at fair value in the financial statements; some of these are measured on a recurring basis while others are measured on a non-recurring basis. Assets and liabilities measured on a recurring basis are those that are adjusted to fair value each time a financial statement is prepared. Assets and liabilities measured on a non-recurring basis are those that are adjusted to fair value when required by particular events or circumstances. In determining the fair value of assets and liabilities, the Company uses various valuation techniques. The availability of inputs observable in the market varies from instrument to instrument and depends on a variety of factors including the type of instrument, whether the instrument is actively traded, and other characteristics particular to the transaction. For many financial instruments, pricing inputs are readily observable in the market, the valuation methodology used is widely accepted by market participants, and the valuation does not require significant management discretion. For other financial instruments, pricing inputs are less observable in the market and may require management judgment.

The Company assesses the inputs used to measure fair value using a three-tier hierarchy. The hierarchy indicates the extent to which inputs used in measuring fair value are observable in the market. Level 1 inputs include quoted prices for identical instruments and are the most observable.

Level 2 inputs include quoted prices for similar assets and observable inputs such as interest rates, foreign currency exchange rates and commodity prices. The Company uses the market approach to derive the fair value for its level 2 fair value measurements. Forward contracts for foreign currency, commodities and interest rates are valued using current quoted forward rates and prices; and investments in marketable securities and cash equivalents are valued using publicly quoted prices.

Level 3 inputs are not observable in the market and include management’s judgments about the assumptions market participants would use in pricing the asset or liability. The use of observable and unobservable inputs is reflected in the hierarchy assessment disclosed in the following tables.

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Recurring Fair Value Measurements

The following tables present information about the Company’s assets and liabilities measured at fair value on a recurring basis (in thousands):

	June 28, 2015
	Balance		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets:
Cash equivalents	$	1,030,928	$	558,660	$	472,268	$	—
Marketable securities	90,214		37,698		52,516		—
Derivatives	26,501		—		26,501		—
	$	1,147,643	$	596,358	$	551,285	$	—
Liabilities:
Derivatives	$	986	$	—	$	986	$	—
	December 31, 2014
	Balance		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets:
Cash equivalents	$	737,024	$	482,686	$	254,338	$	—
Marketable securities	91,140		33,815		57,325		—
Derivatives	32,244		—		32,244		—
	$	860,408	$	516,501	$	343,907	$	—
Liabilities:
Derivatives	$	2,027	$	—	$	2,027	$	—
	June 29, 2014
	Balance		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets:
Cash equivalents	$	660,520	$	482,780	$	177,740	$	—
Marketable securities	91,381		33,567		57,814		—
Derivatives	3,159		—		3,159		—
	$	755,060	$	516,347	$	238,713	$	—
Liabilities:
Derivatives	$	1,478	$	—	$	1,478	$	—

Nonrecurring Fair Value Measurements

Repossessed inventory is recorded at the lower of cost or net realizable value through a nonrecurring fair value measurement. The nonrecurring fair value measurement represents the loss recognized to adjust the related finance receivable to the fair value of the repossessed inventory. Repossessed inventory was $13.1 million, $13.4 million and $11.2 million at June 28, 2015, December 31, 2014 and June 29, 2014, for which the fair value adjustment was $1.9 million, $5.0 million and $2.4 million at June 28, 2015, December 31, 2014 and June 29, 2014, respectively. Fair value is estimated using Level 2 inputs based on the recent market values of repossessed inventory.

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7. Fair Value of Financial Instruments

The Company’s financial instruments consist primarily of cash and cash equivalents, marketable securities, trade receivables, finance receivables, net, trade payables, debt, and foreign currency exchange and commodity contracts (derivative instruments are discussed further in Note 8).

The following table summarizes the fair value and carrying value of the Company’s financial instruments (in thousands):

	June 28, 2015				December 31, 2014				June 29, 2014
	Fair Value		Carrying Value		Fair Value		Carrying Value		Fair Value		Carrying Value
Assets:
Cash and cash equivalents	$	1,247,579	$	1,247,579	$	906,680	$	906,680	$	999,346	$	999,346
Marketable securities	$	90,214	$	90,214	$	91,140	$	91,140	$	91,381	$	91,381
Derivatives	$	26,501	$	26,501	$	32,244	$	32,244	$	3,159	$	3,159
Finance receivables, net	$	7,251,671	$	7,148,495	$	6,519,500	$	6,432,881	$	6,917,698	$	6,818,917
Restricted cash	$	162,211	$	162,211	$	122,052	$	122,052	$	154,681	$	154,681
Liabilities:
Derivatives	$	986	$	986	$	2,027	$	2,027	$	1,478	$	1,478
Unsecured commercial paper	$	114,983	$	114,983	$	731,786	$	731,786	$	619,622	$	619,622
Asset-backed Canadian commercial paper conduit facility	$	160,940	$	160,940	$	166,912	$	166,912	$	173,224	$	173,224
Medium-term notes	$	4,077,952	$	3,933,698	$	3,502,536	$	3,334,398	$	3,049,735	$	2,853,232
Term asset-backed securitization debt	$	2,016,232	$	2,017,079	$	1,270,656	$	1,271,533	$	1,717,287	$	1,712,855

Cash and Cash Equivalents and Restricted Cash – With the exception of certain cash equivalents, the carrying values of these items in the financial statements are based on historical cost. The historical cost basis for these amounts is estimated to approximate their respective fair values due to the short maturity of these instruments. Fair value is based on Level 1 or Level 2 inputs.

Marketable Securities – The carrying value of marketable securities in the financial statements is based on fair value. The fair value of marketable securities is determined primarily based on quoted prices for identical instruments or on quoted market prices of similar financial assets. Fair value is based on Level 1 or Level 2 inputs.

Finance Receivables, Net – The carrying value of retail and wholesale finance receivables in the financial statements is amortized cost less an allowance for credit losses. The fair value of retail finance receivables is generally calculated by discounting future cash flows using an estimated discount rate that reflects current credit, interest rate and prepayment risks associated with similar types of instruments. Fair value is determined based on Level 3 inputs. The amortized cost basis of wholesale finance receivables approximates fair value because they either are short-term or have interest rates that adjust with changes in market interest rates.

Derivatives – Forward contracts for foreign currency exchange, interest rates and commodities are derivative financial instruments and are carried at fair value on the balance sheet. The fair value of these contracts is determined using quoted forward rates and prices. Fair value is calculated using Level 2 inputs.

Debt – The carrying value of debt in the financial statements is generally amortized cost. The carrying value of unsecured commercial paper approximates fair value due to its short maturity. Fair value is calculated using Level 2 inputs.

The carrying value of debt provided under the Canadian Conduit approximates fair value since the interest rates charged under the facility are tied directly to market rates and fluctuate as market rates change. Fair value is calculated using Level 2 inputs.

The fair values of the medium-term notes are estimated based upon rates currently available for debt with similar terms and remaining maturities. Fair value is calculated using Level 2 inputs.

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The fair value of the debt related to term asset-backed securitization transactions is estimated based on pricing currently available for transactions with similar terms and maturities. Fair value is calculated using Level 2 inputs.

8. Derivative Instruments and Hedging Activities

The Company is exposed to certain risks such as foreign currency exchange rate risk, interest rate risk and commodity price risk. To reduce its exposure to such risks, the Company selectively uses derivative financial instruments. All derivative transactions are authorized and executed pursuant to regularly reviewed policies and procedures, which prohibit the use of financial instruments for speculative trading purposes.

All derivative instruments are recognized on the balance sheet at fair value (see Note 6). In accordance with ASC Topic 815, “Derivatives and Hedging,” the accounting for changes in the fair value of a derivative instrument depends on whether it has been designated and qualifies as part of a hedging relationship and, further, on the type of hedging relationship. Changes in the fair value of derivatives that are designated as fair value hedges, along with the gain or loss on the hedged item, are recorded in current period earnings. For derivative instruments that are designated as cash flow hedges, the effective portion of gains and losses that result from changes in the fair value of derivative instruments is initially recorded in other comprehensive income (OCI) and subsequently reclassified into earnings when the hedged item affects income. The Company assesses, both at the inception of each hedge and on an on-going basis, whether the derivatives that are used in its hedging transactions are highly effective in offsetting changes in cash flows of the hedged items. Any ineffective portion is immediately recognized in earnings. No component of a hedging derivative instrument’s gain or loss is excluded from the assessment of hedge effectiveness. Derivative instruments that do not qualify for hedge accounting are recorded at fair value, and any changes in fair value are recorded in current period earnings.

The Company sells its products internationally and in most markets those sales are made in the foreign country’s local currency. As a result, the Company’s earnings can be affected by fluctuations in the value of the U.S. dollar relative to foreign currency. The Company’s most significant foreign currency risk relates to the Euro, the Australian dollar, the Japanese yen and the Brazilian real. The Company utilizes foreign currency exchange contracts to mitigate the effects of these currencies’ fluctuations on earnings. The foreign currency exchange contracts are entered into with banks and allow the Company to exchange a specified amount of foreign currency for U.S. dollars at a future date, based on a fixed exchange rate.

The Company utilizes commodity contracts to hedge portions of the cost of certain commodities consumed in the Company’s motorcycle production and distribution operations.

The Company’s foreign currency exchange contracts and commodity contracts generally have maturities of less than one year.

During the second quarter of 2015, the Company entered into treasury rate locks to hedge the underlying U.S. treasury rate related to its anticipated issuance of senior unsecured debt during the third quarter of 2015. To the extent effective, gains and losses on the fair value of the treasury rate locks will be deferred until the forecasted debt is issued and will be amortized to earnings over the life of the debt.

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The following table summarizes the fair value of the Company’s derivative financial instruments (in thousands):

	June 28, 2015						December 31, 2014						June 29, 2014
Derivatives Designated As Hedging Instruments Under ASC Topic 815	Notional Value		Asset Fair  Value(a)		Liability Fair  Value(b)		Notional Value		Asset Fair  Value(a)		Liability Fair  Value(b)		Notional Value		Asset Fair  Value(a)		Liability Fair  Value(b)
Foreign currency contracts(c)	$	367,309	$	23,136	$	—	$	339,077	$	32,244	$	—	$	398,338	$	3,091	$	1,461
Commodity contracts(c)	1,166		—		98		1,728		—		414		1,411		—		17
Treasury rate locks(c)	300,000		3,365		—		—		—		—		—		—		—
Total	$	668,475	$	26,501	$	98	$	340,805	$	32,244	$	414	$	399,749	$	3,091	$	1,478
	June 28, 2015						December 31, 2014						June 29, 2014
Derivatives Not Designated As Hedging Instruments Under ASC Topic 815	Notional Value		Asset Fair  Value(a)		Liability Fair  Value(b)		Notional Value		Asset Fair  Value(a)		Liability Fair  Value(b)		Notional Value		Asset Fair  Value(a)		Liability Fair  Value(b)
Commodity contracts	$	8,218	$	—	$	888	$	11,804	$	—	$	1,613	$	7,754	$	68	$	—
	$	8,218	$	—	$	888	$	11,804	$	—	$	1,613	$	7,754	$	68	$	—

(a) Foreign currency and commodity contract fair value included in other current assets and Treasury rate lock fair value included in other long-term assets

(b) Included in accrued liabilities

(c) Derivative designated as a cash flow hedge

The following tables summarize the amount of gains and losses related to derivative financial instruments designated as cash flow hedges (in thousands):

	Amount of Gain/(Loss) Recognized in OCI, before tax
	Three months ended						Six months ended
Cash Flow Hedges	June 28, 2015			June 29, 2014			June 28, 2015			June 29, 2014
Foreign currency contracts	$	(4,458	)	$	3,931		$	28,210		$	2,493
Commodity contracts	(3		)	(24		)	(123		)	191
Treasury rate locks	3,365			—			3,365			—
Total	$	(1,096	)	$	3,907		$	31,452		$	2,684

	Amount of Gain/(Loss) Reclassified from AOCL into Income
	Three months ended						Six months ended						Expected to be Reclassified
Cash Flow Hedges	June 28, 2015			June 29, 2014			June 28, 2015			June 29, 2014			Over the Next Twelve Months
Foreign currency contracts(a)	$	20,131		$	(1,183	)	$	35,407		$	(2,241	)	$	23,461
Commodity contracts(a)	(125		)	87			(439		)	283			(98		)
Treasury rate locks(b)	—			—			—			—			191
Total	$	20,006		$	(1,096	)	$	34,968		$	(1,958	)	$	23,554

(a) Gain/(loss) reclassified from accumulated other comprehensive loss (AOCL) to income is included in cost of goods sold

(b) Gain/(loss) reclassified from accumulated other comprehensive loss (AOCL) to income will be included in interest expense

For the three and six months ended June 28, 2015 and June 29, 2014, the cash flow hedges were highly effective and, as a result, the amount of hedge ineffectiveness was not material. No amounts were excluded from effectiveness testing.

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The following tables summarize the amount of gains and losses related to derivative financial instruments not designated as hedging instruments (in thousands):

	Amount of Gain/(Loss) Recognized in Income on Derivative
	Three months ended				Six months ended
Derivatives Not Designated As Hedges	June 28, 2015		June 29, 2014		June 28, 2015			June 29, 2014
Commodity contracts(a)	$	14	$	184	$	(526	)	$	(144	)
Total	$	14	$	184	$	(526	)	$	(144	)

(a) Gain/(loss) recognized in income is included in cost of goods sold.

The Company is exposed to credit loss risk in the event of non-performance by counterparties to these derivative financial instruments. Although no assurances can be given, the Company does not expect any of the counterparties to these derivative financial instruments to fail to meet its obligations. To manage credit loss risk, the Company evaluates counterparties based on credit ratings and, on a quarterly basis, evaluates each hedge’s net position relative to the counterparty’s ability to cover its position.

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9. Accumulated Other Comprehensive Loss

The following tables set forth the changes in accumulated other comprehensive loss (AOCL) (in thousands):

	Three months ended June 28, 2015
	Foreign currency translation adjustments			Marketable securities			Derivative financial instruments			Pension and postretirement benefit plans			Total
Balance, beginning of period	$	(30,503	)	$	(767	)	$	30,114		$	(521,005	)	$	(522,161	)
Other comprehensive income (loss) before reclassifications	5,040			(204		)	(1,096		)	—			3,740
Income tax	(789		)	76			406			—			(307		)
Net other comprehensive income (loss) before reclassifications	4,251			(128		)	(690		)	—			3,433
Reclassifications:
Realized (gains) losses - foreign currency contracts(a)	—			—			(20,131		)	—			(20,131		)
Realized (gains) losses - commodities contracts(a)	—			—			125			—			125
Prior service credits(b)	—			—			—			(695		)	(695		)
Actuarial losses(b)	—			—			—			14,670			14,670
Total before tax	—			—			(20,006		)	13,975			(6,031		)
Income tax expense (benefit)	—			—			7,410			(5,177		)	2,233
Net reclassifications	—			—			(12,596		)	8,798			(3,798		)
Other comprehensive income (loss)	4,251			(128		)	(13,286		)	8,798			(365		)
Balance, end of period	$	(26,252	)	$	(895	)	$	16,828		$	(512,207	)	$	(522,526	)
	Three months ended June 29, 2014
	Foreign currency translation adjustments			Marketable securities			Derivative financial instruments			Pension and postretirement benefit plans			Total
Balance, beginning of period	$	36,274		$	(318	)	$	(1,907	)	$	(357,978	)	$	(323,929	)
Other comprehensive income (loss) before reclassifications	6,945			(117		)	3,907			—			10,735
Income tax	(1,212		)	43			(1,448		)	—			(2,617		)
Net other comprehensive income (loss) before reclassifications	5,733			(74		)	2,459			—			8,118
Reclassifications:
Realized (gains) losses - foreign currency contracts(a)	—			—			1,183			—			1,183
Realized (gains) losses - commodities contracts(a)	—			—			(87		)	—			(87		)
Prior service credits(b)	—			—			—			(684		)	(684		)
Actuarial losses(b)	—			—			—			10,323			10,323
Total before tax	—			—			1,096			9,639			10,735
Income tax benefit	—			—			(405		)	(3,570		)	(3,975		)
Net reclassifications	—			—			691			6,069			6,760
Other comprehensive income (loss)	5,733			(74		)	3,150			6,069			14,878
Balance, end of period	$	42,007		$	(392	)	$	1,243		$	(351,909	)	$	(309,051	)

23

	Six months ended June 28, 2015
	Foreign currency translation adjustments			Marketable securities			Derivative financial instruments			Pension and postretirement benefit plans			Total
Balance, beginning of period	$	(3,482	)	$	(700	)	$	19,042		$	(529,803	)	$	(514,943	)
Other comprehensive (loss) income before reclassifications	(24,951		)	(310		)	31,452			—			6,191
Income tax	2,181			115			(11,650		)	—			(9,354		)
Net other comprehensive (loss) income before reclassifications	(22,770		)	(195		)	19,802			—			(3,163		)
Reclassifications:
Realized (gains) losses - foreign currency contracts(a)	—			—			(35,407		)	—			(35,407		)
Realized (gains) losses - commodities contracts(a)	—			—			439			—			439
Prior service credits(b)	—			—			—			(1,390		)	(1,390		)
Actuarial losses(b)	—			—			—			29,340			29,340
Total before tax	—			—			(34,968		)	27,950			(7,018		)
Income tax expense (benefit)	—			—			12,952			(10,354		)	2,598
Net reclassifications	—			—			(22,016		)	17,596			(4,420		)
Other comprehensive (loss) income	(22,770		)	(195		)	(2,214		)	17,596			(7,583		)
Balance, end of period	$	(26,252	)	$	(895	)	$	16,828		$	(512,207	)	$	(522,526	)
	Six months ended June 29, 2014
	Foreign currency translation adjustments			Marketable securities			Derivative financial instruments			Pension and postretirement benefit plans			Total
Balance, beginning of period	$	33,326		$	(276	)	$	(1,680	)	$	(364,046	)	$	(332,676	)
Other comprehensive income (loss) before reclassifications	8,700			(184		)	2,684			—			11,200
Income tax	(19		)	68			(994		)	—			(945		)
Net other comprehensive income (loss) before reclassifications	8,681			(116		)	1,690			—			10,255
Reclassifications:
Realized (gains) losses - foreign currency contracts(a)	—			—			2,241			—			2,241
Realized (gains) losses - commodities contracts(a)	—			—			(283		)	—			(283		)
Prior service credits(b)	—			—			—			(1,368		)	(1,368		)
Actuarial losses(b)	—			—			—			20,645			20,645
Total before tax	—			—			1,958			19,277			21,235
Income tax benefit	—			—			(725		)	(7,140		)	(7,865		)
Net reclassifications	—			—			1,233			12,137			13,370
Other comprehensive income (loss)	8,681			(116		)	2,923			12,137			23,625
Balance, end of period	$	42,007		$	(392	)	$	1,243		$	(351,909	)	$	(309,051	)

(a) Amounts reclassified to net income are included in Motorcycles and Related Products cost of goods sold.

(b) Amounts reclassified are included in the computation of net periodic period cost. See Note 14 for information related to pension and postretirement benefit plans.

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10. Debt

Debt with contractual terms less than one year is generally classified as short-term debt and consisted of the following (in thousands):

	June 28, 2015		December 31, 2014		June 29, 2014
Unsecured commercial paper	$	114,983	$	731,786	$	619,622

Debt with a contractual term greater than one year is generally classified as long-term debt and consisted of the following (in thousands):

	June 28, 2015			December 31, 2014			June 29, 2014
Secured debt
Asset-backed Canadian commercial paper conduit facility	$	160,940		$	166,912		$	173,224
Term asset-backed securitization debt	2,017,079			1,271,533			1,712,855
Unsecured notes
5.75% Medium-term notes due in 2014 ($500.0 million par value)	—			—			499,946
1.15% Medium-term notes due in 2015 ($600.0 million par value)	599,954			599,817			599,680
3.88% Medium-term notes due in 2016 ($450.0 million par value)	449,964			449,937			449,910
2.70% Medium-term notes due in 2017 ($400.0 million par value)	399,972			399,963			399,955
1.55% Medium-term notes due in 2017 ($400.0 million par value)	399,557			399,464			—
6.80% Medium-term notes due in 2018 ($888.0 million par value)	887,467			887,381			903,741
2.40% Medium-term notes due in 2019 ($600.0 million par value)	598,066			597,836			—
2.15% Medium-term notes due in 2020 ($600.0 million par value)	598,718			—			—
Gross long-term debt	6,111,717			4,772,843			4,739,311
Less: current portion of long-term debt	(1,551,368		)	(1,011,315		)	(944,915		)
Long-term debt	$	4,560,349		$	3,761,528		$	3,794,396

During the first and second quarters of 2015, the Company issued $700.0 million and $500.0 million, respectively, of secured notes through term asset-backed securitization transactions. During the second quarter of 2014, the Company issued $850.0 million of secured notes through one term asset-backed securitization transaction. There were no other term asset-backed securitization transactions during the six months ended June 29, 2014. The term asset-backed securitization transactions are further discussed in Note 5.

There were no medium-term notes issued or repurchased during the second quarter of 2015. During the first quarter of 2015, the Company issued $600.0 million of medium-term notes which mature in February 2020 and have an annual interest rate of 2.15%. There were no medium-term notes issued during the six months ended June 29, 2014. During the second quarter of 2014, HDFS repurchased an aggregate of $6.1 million of its 6.80% medium-term notes which mature in June 2018. As a result, HDFS recognized in financial services interest expense $1.1 million of loss on the extinguishment of debt, which included unamortized discounts and fees.

11. Income Taxes

The Company’s 2015 income tax rate for the six months ended June 28, 2015 was 34.9% compared to 35.3% for the same period last year.

12. Product Warranty and Recall Campaigns

The Company currently provides a standard two-year limited warranty on all new motorcycles sold worldwide, except for Japan, where the Company currently provides a standard three-year limited warranty on all new motorcycles sold. In addition, the Company provides a one-year warranty for Parts & Accessories (P&A). The warranty coverage for the retail customer generally begins when the product is sold to a retail customer. The Company maintains reserves for future warranty claims using an estimated cost, which is based primarily on historical Company claim information. Additionally, the Company has from time to time initiated voluntary recall campaigns. The Company reserves for all estimated costs associated with recalls in the period that management approves and commits to the recall.

25

Changes in the Company’s warranty and recall liability were as follows (in thousands):

	Three months ended						Six months ended
	June 28, 2015			June 29, 2014			June 28, 2015			June 29, 2014
Balance, beginning of period	$	71,073		$	69,336		$	69,250		$	64,120
Warranties issued during the period	21,843			19,824			36,954			37,186
Settlements made during the period	(23,554		)	(16,921		)	(37,119		)	(28,494		)
Recalls and changes to pre-existing warranty liabilities	14,054			3,798			14,331			3,225
Balance, end of period	$	83,416		$	76,037		$	83,416		$	76,037

The liability for recall campaigns was $16.6 million, $9.8 million and $6.8 million as of June 28, 2015, December 31, 2014 and June 29, 2014, respectively.

13. Earnings Per Share

The following table sets forth the computation for basic and diluted earnings per share (in thousands, except per share amounts):

	Three months ended				Six months ended
	June 28, 2015		June 29, 2014		June 28, 2015		June 29, 2014
Numerator:
Net income used in computing basic and diluted earnings per share	$	299,810	$	354,153	$	569,664	$	620,070
Denominator:
Denominator for basic earnings per share - weighted-average common shares	207,650		217,762		209,115		218,367
Effect of dilutive securities - employee stock compensation plan	940		1,399		1,050		1,453
Denominator for diluted earnings per share - adjusted weighted-average shares outstanding	208,590		219,161		210,165		219,820
Earnings per common share:
Basic	$	1.44	$	1.63	$	2.72	$	2.84
Diluted	$	1.44	$	1.62	$	2.71	$	2.82

Outstanding options to purchase 1.0 million and 0.4 million shares of common stock for the three months ended June 28, 2015 and June 29, 2014, respectively and 0.8 million and 0.5 million shares of common stock for the six months ended June 28, 2015 and June 29, 2014 were not included in the Company’s computation of dilutive securities because the exercise price was greater than the market price and therefore the effect would have been anti-dilutive.

The Company has a share-based compensation plan under which employees may be granted share-based awards including shares of restricted stock and restricted stock units (RSUs). Non-forfeitable dividends are paid on unvested shares of restricted stock and non-forfeitable dividend equivalents are paid on unvested RSUs. As such, shares of restricted stock and RSUs are considered participating securities under the two-class method of calculating earnings per share as described in ASC Topic 260, “Earnings per Share.” The two-class method of calculating earnings per share did not have a material impact on the Company’s earnings per share calculation for the three and six month periods ended June 28, 2015 and June 29, 2014, respectively.

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14. Employee Benefit Plans

The Company has a defined benefit pension plan and postretirement healthcare benefit plans that cover certain employees of the Motorcycles segment. The Company also has unfunded supplemental employee retirement plan agreements (SERPA) with certain employees which were instituted to replace benefits lost under the Tax Revenue Reconciliation Act of 1993. Net periodic benefit costs are allocated among selling, administrative and engineering expense, cost of goods sold and inventory. Amounts capitalized in inventory are not significant. Components of net periodic benefit costs were as follows (in thousands):

	Three months ended						Six months ended
	June 28, 2015			June 29, 2014			June 28, 2015			June 29, 2014
Pension and SERPA Benefits
Service cost	$	10,010		$	7,874		$	20,020		$	15,748
Interest cost	21,836			21,731			43,672			43,462
Expected return on plan assets	(36,232		)	(34,184		)	(72,465		)	(68,368		)
Amortization of unrecognized:
Prior service cost	109			279			218			558
Net loss	13,677			9,141			27,354			18,281
Net periodic benefit cost	$	9,400		$	4,841		$	18,799		$	9,681
Postretirement Healthcare Benefits
Service cost	$	2,065		$	1,754		$	4,130		$	3,508
Interest cost	3,541			4,220			7,082			8,439
Expected return on plan assets	(2,877		)	(2,607		)	(5,754		)	(5,215		)
Amortization of unrecognized:
Prior service credit	(804		)	(963		)	(1,608		)	(1,927		)
Net loss	993			1,182			1,986			2,364
Net periodic benefit cost	$	2,918		$	3,586		$	5,836		$	7,169

No pension contributions to qualified plans are required in 2015. The Company expects it will continue to make on-going contributions related to current benefit payments for SERPA and postretirement healthcare plans.

15. Business 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. Selected segment information is set forth below (in thousands):

	Three months ended				Six months ended
	June 28, 2015		June 29, 2014		June 28, 2015		June 29, 2014
Motorcycles net revenue	$	1,650,783	$	1,834,285	$	3,161,353	$	3,405,973
Gross profit	647,214		724,139		1,237,489		1,316,270
Selling, administrative and engineering expense	266,611		250,883		511,432		495,322
Operating income from Motorcycles	380,603		473,256		726,057		820,948
Financial Services revenue	173,609		166,414		335,984		320,774
Financial Services expense	91,696		91,975		189,407		183,145
Operating income from Financial Services	81,913		74,439		146,577		137,629
Operating income	$	462,516	$	547,695	$	872,634	$	958,577

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16. Commitments and Contingencies

The Company is subject to lawsuits and other claims related to environmental, product and other matters. In determining required reserves related to these items, the Company carefully analyzes cases and considers the likelihood of adverse judgments or outcomes, as well as the potential range of possible loss. The required reserves are monitored on an ongoing basis and are updated based on new developments or new information in each matter.

Environmental Protection Agency Notice

In December 2009, the Company received formal, written requests for information from the United States Environmental Protection Agency (EPA) regarding: (i) certificates of conformity for motorcycle emissions and related designations and labels, (ii) aftermarket parts, and (iii) warranty claims on emissions related components. The Company promptly submitted written responses to the EPA’s inquiry and has engaged in discussions with the EPA. Since that time, the EPA has delivered various additional requests for information to which the Company has responded. It is probable that a result of the EPA’s investigation will be some form of enforcement action by the EPA that will seek a fine and/or other relief. The Company has a reserve associated with this matter which is included in accrued liabilities in the Consolidated Balance Sheet. However, given the uncertainty that still exists concerning the resolution of this matter, there is a possibility that the actual loss incurred may be materially different than the Company’s current reserve. At this time, the Company cannot reasonably estimate the impact of any remedies the EPA might seek beyond the Company's current reserve for this matter, if any.

York Environmental Matters:

The Company is involved with government agencies and groups of potentially responsible parties in various environmental matters, including a matter involving the cleanup of soil and groundwater contamination at its York, Pennsylvania facility. The York facility was formerly used by the U.S. Navy and AMF prior to the purchase of the York facility by the Company from AMF in 1981. Although the Company is not certain as to the full extent of the environmental contamination at the York facility, it has been working with the Pennsylvania Department of Environmental Protection (PADEP) since 1986 in undertaking environmental investigation and remediation activities, including an ongoing site-wide remedial investigation/feasibility study (RI/FS). In January 1995, the Company entered into a settlement agreement (the Agreement) with the Navy, and the parties amended the Agreement in 2013 to address ordnance and explosive waste.

The Agreement calls for the Navy and the Company to contribute amounts into a trust equal to 53% and 47%, respectively, of future costs associated with environmental investigation and remediation activities at the York facility (Response Costs). The trust administers the payment of the Response Costs incurred at the York facility as covered by the Agreement.

The Company has a reserve for its estimate of its share of the future Response Costs at the York facility which is included in accrued liabilities in the Condensed Consolidated Balance Sheets. As noted above, the RI/FS is still underway and given the uncertainty that exists concerning the nature and scope of additional environmental investigation and remediation that may ultimately be required under the RI/FS or otherwise at the York facility, the Company is unable to make a reasonable estimate of those additional costs, if any, that may result.

The estimate of the Company’s future Response Costs that will be incurred at the York facility is based on reports of independent environmental consultants retained by the Company, the actual costs incurred to date and the estimated costs to complete the necessary investigation and remediation activities. Response Costs are expected to be paid primarily over a period of several years ending in 2017 although certain Response Costs may continue for some time beyond 2017.

Product Liability Matters:

The Company is involved in product liability suits related to the operation of its business. The Company accrues for claim exposures that are probable of occurrence and can be reasonably estimated. The Company also maintains insurance coverage for product liability exposures. The Company believes that its accruals and insurance coverage are adequate and that product liability suits will not have a material adverse effect on the Company’s consolidated financial statements.

28

17. Supplemental Consolidating Data

The supplemental consolidating data for the periods noted is presented for informational purposes. The supplemental consolidating data may be different than segment information presented elsewhere due to the allocation of intercompany eliminations to reporting segments. All supplemental data is presented in thousands.

	Three months ended June 28, 2015
	Motorcycles & Related Products Operations		Financial Services Operations		Eliminations			Consolidated
Revenue:
Motorcycles and Related Products	$	1,653,759	$	—	$	(2,976	)	$	1,650,783
Financial Services	—		174,147		(538		)	173,609
Total revenue	1,653,759		174,147		(3,514		)	1,824,392
Costs and expenses:
Motorcycles and Related Products cost of goods sold	1,003,569		—		—			1,003,569
Financial Services interest expense	—		41,188		—			41,188
Financial Services provision for credit losses	—		15,175		—			15,175
Selling, administrative and engineering expense	267,149		38,309		(3,514		)	301,944
Total costs and expenses	1,270,718		94,672		(3,514		)	1,361,876
Operating income	383,041		79,475		—			462,516
Investment income	1,450		—		—			1,450
Interest expense	9		—		—			9
Income before provision for income taxes	384,482		79,475		—			463,957
Provision for income taxes	134,633		29,514		—			164,147
Net income	$	249,849	$	49,961	$	—		$	299,810
	Six months ended June 28, 2015
	Motorcycles & Related Products Operations		Financial Services Operations		Eliminations			Consolidated
Revenue:
Motorcycles and Related Products	$	3,166,641	$	—	$	(5,288	)	$	3,161,353
Financial Services	—		336,837		(853		)	335,984
Total revenue	3,166,641		336,837		(6,141		)	3,497,337
Costs and expenses:
Motorcycles and Related Products cost of goods sold	1,923,864		—		—			1,923,864
Financial Services interest expense	—		79,724		—			79,724
Financial Services provision for credit losses	—		41,422		—			41,422
Selling, administrative and engineering expense	512,284		73,550		(6,141		)	579,693
Total costs and expenses	2,436,148		194,696		(6,141		)	2,624,703
Operating income	730,493		142,141		—			872,634
Investment income	102,772		—		(100,000		)	2,772
Interest expense	18		—		—			18
Income before provision for income taxes	833,247		142,141		(100,000		)	875,388
Provision for income taxes	256,149		49,575		—			305,724
Net income	$	577,098	$	92,566	$	(100,000	)	$	569,664

29

	Three months ended June 29, 2014
	Motorcycles & Related Products Operations		Financial Services Operations		Eliminations			Consolidated
Revenue:
Motorcycles and Related Products	$	1,836,974	$	—	$	(2,689	)	$	1,834,285
Financial Services	—		166,963		(549		)	166,414
Total revenue	1,836,974		166,963		(3,238		)	2,000,699
Costs and expenses:
Motorcycles and Related Products cost of goods sold	1,110,146		—		—			1,110,146
Financial Services interest expense	—		40,741		—			40,741
Financial Services provision for credit losses	—		15,961		—			15,961
Selling, administrative and engineering expense	251,432		37,962		(3,238		)	286,156
Total costs and expenses	1,361,578		94,664		(3,238		)	1,453,004
Operating income	475,396		72,299		—			547,695
Investment income	1,772		—		—			1,772
Interest expense	393		—		—			393
Income before provision for income taxes	476,775		72,299		—			549,074
Provision for income taxes	168,303		26,618		—			194,921
Net income	$	308,472	$	45,681	$	—		$	354,153
	Six months ended June 29, 2014
	Motorcycles & Related Products Operations		Financial Services Operations		Eliminations			Consolidated
Revenue:
Motorcycles and Related Products	$	3,410,941	$	—	$	(4,968	)	$	3,405,973
Financial Services	—		321,649		(875		)	320,774
Total revenue	3,410,941		321,649		(5,843		)	3,726,747
Costs and expenses:
Motorcycles and Related Products cost of goods sold	2,089,703		—		—			2,089,703
Financial Services interest expense	—		79,598		—			79,598
Financial Services provision for credit losses	—		36,292		—			36,292
Selling, administrative and engineering expense	496,197		72,223		(5,843		)	562,577
Total costs and expenses	2,585,900		188,113		(5,843		)	2,768,170
Operating income	825,041		133,536		—			958,577
Investment income	123,431		—		(120,000		)	3,431
Interest expense	4,070		—		—			4,070
Income before provision for income taxes	944,402		133,536		(120,000		)	957,938
Provision for income taxes	288,876		48,992		—			337,868
Net income	$	655,526	$	84,544	$	(120,000	)	$	620,070

30

	June 28, 2015
	Motorcycles & Related Products Operations		Financial Services Operations		Eliminations			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	828,289	$	419,290	$	—		$	1,247,579
Marketable securities	52,516		—		—			52,516
Accounts receivable, net	743,341		—		(465,772		)	277,569
Finance receivables, net	—		2,331,723		—			2,331,723
Inventories	395,044		—		—			395,044
Restricted cash	—		136,760		—			136,760
Deferred income taxes	51,667		43,111		—			94,778
Other current assets	126,856		40,441		(6,876		)	160,421
Total current assets	2,197,713		2,971,325		(472,648		)	4,696,390
Finance receivables, net	—		4,816,772		—			4,816,772
Property, plant and equipment, net	841,361		31,646		—			873,007
Goodwill	26,105		—		—			26,105
Deferred income taxes	57,587		10,861		(1,693		)	66,755
Other long-term assets	121,264		43,842		(79,263		)	85,843
	$	3,244,030	$	7,874,446	$	(553,604	)	$	10,564,872
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	306,335	$	567,073	$	(465,772	)	$	407,636
Accrued liabilities	369,467		87,839		(8,569		)	448,737
Short-term debt	—		114,983		—			114,983
Current portion of long-term debt	—		1,551,368		—			1,551,368
Total current liabilities	675,802		2,321,263		(474,341		)	2,522,724
Long-term debt	—		4,560,349		—			4,560,349
Pension liability	66,786		—		—			66,786
Postretirement healthcare benefits	196,369		—		—			196,369
Other long-term liabilities	168,043		26,974		—			195,017
Shareholders’ equity	2,137,030		965,860		(79,263		)	3,023,627
	$	3,244,030	$	7,874,446	$	(553,604	)	$	10,564,872

31

	December 31, 2014
	Motorcycles & Related Products Operations		Financial Services Operations		Eliminations			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	573,895	$	332,785	$	—		$	906,680
Marketable securities	57,325		—		—			57,325
Accounts receivable, net	658,735		—		(411,114		)	247,621
Finance receivables, net	—		1,916,635		—			1,916,635
Inventories	448,871		—		—			448,871
Restricted cash	—		98,627		—			98,627
Deferred income taxes	50,015		39,901		—			89,916
Other current assets	142,278		43,125		(2,983		)	182,420
Total current assets	1,931,119		2,431,073		(414,097		)	3,948,095
Finance receivables, net	—		4,516,246		—			4,516,246
Property, plant and equipment, net	848,661		34,416		—			883,077
Goodwill	27,752		—		—			27,752
Deferred income taxes	75,121		4,863		(2,149		)	77,835
Other long-term assets	113,727		39,309		(77,944		)	75,092
	$	2,996,380	$	7,025,907	$	(494,190	)	$	9,528,097
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	171,098	$	436,884	$	(411,114	)	$	196,868
Accrued liabilities	370,652		83,797		(5,132		)	449,317
Short-term debt	—		731,786		—			731,786
Current portion of long-term debt	—		1,011,315		—			1,011,315
Total current liabilities	541,750		2,263,782		(416,246		)	2,389,286
Long-term debt	—		3,761,528		—			3,761,528
Pension liability	76,186		—		—			76,186
Postretirement healthcare benefits	203,006		—		—			203,006
Other long-term liabilities	164,060		24,745		—			188,805
Shareholders’ equity	2,011,378		975,852		(77,944		)	2,909,286
	$	2,996,380	$	7,025,907	$	(494,190	)	$	9,528,097

32

	June 29, 2014
	Motorcycles & Related Products Operations		Financial Services Operations		Eliminations			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	635,705	$	363,641	$	—		$	999,346
Marketable securities	57,814		—		—			57,814
Accounts receivable, net	1,317,297		—		(1,027,357		)	289,940
Finance receivables, net	—		2,281,512		—			2,281,512
Inventories	371,597		—		—			371,597
Restricted cash	—		154,681		—			154,681
Deferred income taxes	52,348		38,000		—			90,348
Other current assets	95,429		33,031		—			128,460
Total current assets	2,530,190		2,870,865		(1,027,357		)	4,373,698
Finance receivables, net	—		4,537,405		—			4,537,405
Property, plant and equipment, net	792,642		33,825		—			826,467
Prepaid pension costs	256,279		—		—			256,279
Goodwill	30,252		—		—			30,252
Deferred income taxes	2,915		—		—			2,915
Other long-term assets	111,229		14,506		(76,455		)	49,280
	$	3,723,507	$	7,456,601	$	(1,103,812	)	$	10,076,296
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	316,707	$	1,098,992	$	(1,027,357	)	$	388,342
Accrued liabilities	423,312		79,205		(1,748		)	500,769
Short-term debt	—		619,622		—			619,622
Current portion of long-term debt	—		944,915		—			944,915
Total current liabilities	740,019		2,742,734		(1,029,105		)	2,453,648
Long-term debt	—		3,794,396		—			3,794,396
Pension liability	38,174		—		—			38,174
Postretirement healthcare liability	209,312		—		—			209,312
Deferred income taxes	35,597		1,574		1,748			38,919
Other long-term liabilities	152,862		22,725		—			175,587
Shareholders’ equity	2,547,543		895,172		(76,455		)	3,366,260
	$	3,723,507	$	7,456,601	$	(1,103,812	)	$	10,076,296

33

	Six months ended June 28, 2015
	Motorcycles & Related Products Operations			Financial Services Operations			Eliminations & Adjustments			Consolidated
Cash flows from operating activities:
Net income	$	577,098		$	92,566		$	(100,000	)	$	569,664
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation	88,996			4,644			—			93,640
Amortization of deferred loan origination costs	—			47,524			—			47,524
Amortization of financing origination fees	—			4,820			—			4,820
Provision for employee long-term benefits	24,635			—			—			24,635
Contributions to pension and postretirement plans	(12,725		)	—			—			(12,725		)
Stock compensation expense	15,415			1,319			—			16,734
Net change in wholesale finance receivables related to sales	—			—			(418,969		)	(418,969		)
Provision for credit losses	—			41,422			—			41,422
Deferred income taxes	5,832			(7,027		)	—			(1,195		)
Foreign currency adjustments	11,041			—			—			11,041
Other, net	(2,671		)	707			—			(1,964		)
Change in current assets and current liabilities:
Accounts receivable	(347,967		)	—			304,658			(43,309		)
Finance receivables—accrued interest and other	—			(270		)	—			(270		)
Inventories	38,012			—			—			38,012
Accounts payable and accrued liabilities	144,784			385,999			(298,426		)	232,357
Derivative instruments	1,185			—			—			1,185
Other	9,625			1,717			—			11,342
Total adjustments	(23,838		)	480,855			(412,737		)	44,280
Net cash provided by operating activities	553,260			573,421			(512,737		)	613,944

34

	Six months ended June 28, 2015
	Motorcycles & Related Products Operations			Financial Services Operations			Eliminations & Adjustments			Consolidated
Cash flows from investing activities:
Capital expenditures	(83,282		)	(1,898		)	—			(85,180		)
Origination of finance receivables	—			(4,526,313		)	2,549,750			(1,976,563		)
Collections of finance receivables	—			3,707,444			(2,137,013		)	1,570,431
Sales and redemptions of marketable securities	4,500			—			—			4,500
Other	5,111			—			—			5,111
Net cash used by investing activities	(73,671		)	(820,767		)	412,737			(481,701		)
Cash flows from financing activities:
Proceeds from issuance of medium-term notes	—			595,386			—			595,386
Intercompany borrowing activity	250,000			(250,000		)	—			—
Proceeds from securitization debt	—			1,195,668			—			1,195,668
Repayments of securitization debt	—			(454,332		)	—			(454,332		)
Net decrease in credit facilities and unsecured commercial paper	—			(616,586		)	—			(616,586		)
Borrowings of asset-backed commercial paper	—			40,209			—			40,209
Repayments of asset-backed commercial paper	—			(35,730		)	—			(35,730		)
Net change in restricted cash	—			(40,159		)	—			(40,159		)
Dividends paid	(129,745		)	(100,000		)	100,000			(129,745		)
Purchase of common stock for treasury	(358,425		)	—			—			(358,425		)
Excess tax benefits from share-based payments	2,401			—			—			2,401
Issuance of common stock under employee stock option plans	15,664			—			—			15,664
Net cash (used by) provided by financing activities	(220,105		)	334,456			100,000			214,351
Effect of exchange rate changes on cash and cash equivalents	(5,090		)	(605		)	—			(5,695		)
Net increase in cash and cash equivalents	$	254,394		$	86,505		$	—		$	340,899
Cash and cash equivalents:
Cash and cash equivalents—beginning of period	$	573,895		$	332,785		$	—		$	906,680
Net increase in cash and cash equivalents	254,394			86,505			—			340,899
Cash and cash equivalents—end of period	$	828,289		$	419,290		$	—		$	1,247,579

35

	Six months ended June 29, 2014
	Motorcycles & Related Products Operations			Financial Services Operations			Eliminations & Adjustments			Consolidated
Cash flows from operating activities:
Net income	$	655,526		$	84,544		$	(120,000	)	$	620,070
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation	83,348			3,775			—			87,123
Amortization of deferred loan origination costs	—			45,713						45,713
Amortization of financing origination fees	59			4,225			—			4,284
Provision for employee long-term benefits	16,854			—			—			16,854
Contributions to pension and postretirement plans	(14,035		)	—			—			(14,035		)
Stock compensation expense	19,393			1,375			—			20,768
Net change in wholesale finance receivables related to sales	—			—			(510,200		)	(510,200		)
Provision for credit losses	—			36,292			—			36,292
Loss on extinguishment of debt	—			1,145			—			1,145
Deferred income taxes	(3,894		)	—			—			(3,894		)
Foreign currency adjustments	939			(6,023		)	—			(5,084		)
Other, net	4,712			4,620			—			9,332
Change in current assets and current liabilities:
Accounts receivable	(363,817		)	—			338,174			(25,643		)
Finance receivables—accrued interest and other	—			(993		)	—			(993		)
Inventories	58,741			—			—			58,741
Accounts payable and accrued liabilities	189,117			375,290			(338,174		)	226,233
Derivative instruments	968			—			—			968
Other	4,962			(2,044		)	—			2,918
Total adjustments	(2,653		)	463,375			(510,200		)	(49,478		)
Net cash provided by operating activities	652,873			547,919			(630,200		)	570,592

36

	Six months ended June 29, 2014
	Motorcycles & Related Products Operations			Financial Services Operations			Eliminations & Adjustments			Consolidated
Cash flows from investing activities:
Capital expenditures	(71,395		)	(3,128		)	—			(74,523		)
Origination of finance receivables	—			(4,580,910		)	2,676,333			(1,904,577		)
Collections of finance receivables	—			3,684,319			(2,166,133		)	1,518,186
Sales and redemptions of marketable securities	41,010			—			—			41,010
Other	145			—			—			145
Net cash used by investing activities	(30,240		)	(899,719		)	510,200			(419,759		)
Cash flows from financing activities:
Repayments of senior unsecured notes	(303,000		)	—			—			(303,000		)
Repayments of medium-term notes	—			(7,220		)	—			(7,220		)
Intercompany borrowing activity	(100,000		)	100,000			—			—
Proceeds from securitization debt	—			847,126			—			847,126
Repayments of securitization debt	—			(393,655		)	—			(393,655		)
Net decrease in credit facilities and unsecured commercial paper	—			(48,134		)	—			(48,134		)
Borrowings of asset-backed commercial paper	—			36,800			—			36,800
Repayments of asset-backed commercial paper	—			(37,317		)	—			(37,317		)
Net change in restricted cash	—			(9,874		)	—			(9,874		)
Dividends paid	(120,631		)	(120,000		)	120,000			(120,631		)
Purchase of common stock for treasury	(223,736		)	—			—			(223,736		)
Excess tax benefits from share-based payments	8,652			—			—			8,652
Issuance of common stock under employee stock option plans	27,907			—			—			27,907
Net cash (used by) provided by financing activities	(710,808		)	367,726			120,000			(223,082		)
Effect of exchange rate changes on cash and cash equivalents	4,968			15			—			4,983
Net (decrease) increase in cash and cash equivalents	$	(83,207	)	$	15,941		$	—		$	(67,266	)
Cash and cash equivalents:
Cash and cash equivalents—beginning of period	$	718,912		$	347,700		$	—		$	1,066,612
Net (decrease) increase in cash and cash equivalents	(83,207		)	15,941			—			(67,266		)
Cash and cash equivalents—end of period	$	635,705		$	363,641		$	—		$	999,346

37

18. Subsequent Events

In July 2015, the Company issued $750.0 million of senior unsecured notes in an underwritten offering. The senior unsecured notes provided for semi-annual interest payments and principal due at maturity. Senior unsecured notes of $450.0 million mature in July 2025 and have an interest rate of 3.50%, and $300.0 million of the senior unsecured notes mature in July 2045 and have an interest rate of 4.625%. In June 2015, the Company announced that it would use the proceeds from the debt to repurchase shares of its common stock.

On August 4, 2015, the Company completed its previously announced purchase of certain assets from Fred Deeley Imports, Ltd. (Deeley Imports) and certain of its affiliates including, among other things, the acquisition of the exclusive right to distribute the Company's motorcycles and other products in Canada (Transaction). The Company will operate in Canada through a newly established, Company owned subsidiary (H-D Canada, L.P.) based in Concord, Ontario. H-D Canada, L.P. paid $62 million to Deeley Imports for the Canadian distribution rights, inventory and accounts receivable, net of amounts due, and other assets. H-D Canada, L.P. also indemnified Deeley Imports for certain expenses and liabilities, including employee severance costs.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Harley-Davidson, Inc. is the parent company of the groups of companies doing business as Harley-Davidson Motor Company (HDMC) and Harley-Davidson Financial Services (HDFS). Unless the context otherwise requires, all references to the "Company" include Harley-Davidson, Inc. and all its subsidiaries. The Company operates in two business segments: Motorcycles & Related Products (Motorcycles) and Financial Services. 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 Motorcycles 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 segment consists of HDFS which provides wholesale and retail financing and insurance-related programs primarily to Harley-Davidson dealers and their retail customers. HDFS conducts business primarily in the United States and Canada.

The “% Change” figures included in the “Results of Operations” section were calculated using unrounded dollar amounts and may differ from calculations using the rounded dollar amounts presented.

Overview

The Company’s net income was $299.8 million, or $1.44 per diluted share, for the second quarter of 2015 compared to $354.2 million, or $1.62 per diluted share, in the second quarter of 2014. Operating income from Motorcycles decreased $92.7 million or 19.6% compared to last year’s second quarter driven by lower shipments, unfavorable foreign currency exchange rates and higher selling, administrative and engineering expenses. Operating income from Financial Services in the second quarter of 2015 was $81.9 million, up 10.0% compared to $74.4 million in the year-ago quarter driven by higher interest income.

During the second quarter of 2015, independent dealer retail sales of new Harley-Davidson motorcycles were lower compared to the prior year second quarter in both the U.S. and international markets. Worldwide retail sales of new Harley-Davidson motorcycles were down 1.4% in the second quarter of 2015 compared to the second quarter of 2014.

Although retail sales were lower, the Company believes that the second quarter 2015 worldwide retail sales continued to reflect a positive consumer response to its latest Rushmore models launched in August 2014 and its Street motorcycles.

In the second quarter of 2015, U.S. retail sales comparisons were impacted by challenging prior year results which included the enthusiastic consumer reception for the initial Project Rushmore^TM models and sales of Street motorcycles related to rider-training fleets in the second quarter of 2014. The Company believes U.S. retail sales in the second quarter of 2015 were also impacted by foreign exchange-driven discounting by competitors. Internationally, the Company believes retail sales were negatively impacted primarily by new, low-priced models from competitors in Europe, currency-driven volume declines in markets where the Company sells in non-local currencies and challenging economic conditions in certain international markets.

During the second quarter of 2015, the company initiated a market action plan in the U.S. and certain international markets in an effort to counter the impacts of competitive activity in the market. The Company's market action plan includes

38

lifestyle and brand advertising and marketing, targeted finance offers and a plan to leverage its other competitive advantages such as Riding Academy and its dealer network. The Company believes that these activities had a positive impact on its June retail sales resulting in its highest June retail sales in the U.S. since 2008.

(1) Note Regarding Forward-Looking Statements

The Company intends that certain matters discussed in this report are “forward-looking statements” intended to qualify for the safe harbor from liability established by the Private Securities Litigation Reform Act of 1995. These forward-looking statements can generally be identified as such by reference to this footnote or because the context of the statement will include words such as the Company “believes,” “anticipates,” “expects,” “plans,” or “estimates” or words of similar meaning. Similarly, statements that describe future plans, objectives, outlooks, targets, guidance or goals are also forward-looking statements. Such forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those anticipated as of the date of this report. Certain of such risks and uncertainties are described in close proximity to such statements or elsewhere in this report, including under the caption “Cautionary Statements” and in Item 1A “Risk Factors” of the Company’s Annual Report on Form 10-K for the year ended December 31, 2014. Shareholders, potential investors, and other readers are urged to consider these factors in evaluating the forward-looking statements and cautioned not to place undue reliance on such forward-looking statements. The forward-looking statements included in the Outlook section are only made as of July 21, 2015 and the remaining forward looking statements in this report are only made as of the date of the filing of this report (August 6, 2015) and the Company disclaims any obligation to publicly update such forward-looking statements to reflect subsequent events or circumstances.

Outlook⁽¹⁾ 

On July 21, 2015, the Company provided the following information concerning its expectations for the remainder of 2015, which did not reflect the potential impact of the Canada Distributor Transaction discussed below. Please refer to the "Canada Distributor Transaction" section for additional information concerning 2015 expectations.

The Company reaffirmed its expectation to ship 276,000 to 281,000 Harley-Davidson motorcycles to dealers and distributors worldwide in 2015, an increase of approximately 2% to 4% over 2014. In addition, the Company announced that its full-year shipment estimate includes expected shipments of 54,000 to 59,000 motorcycles in the third quarter of 2015 compared to 50,670 motorcycles shipped in the third quarter of 2014. The Company will rely on its flexible manufacturing capabilities to balance production between the third and fourth quarters of 2015 to improve overall efficiencies.

As the Company exited the second quarter, its business remains under pressure from increased competitive activity, including aggressive price discounting in the U.S. enabled by the dramatic shift in world currencies. The Company continues to believe it is critical for it to support a healthy retail channel and protect its premium brand by aggressively managing supply in line with demand. The Company will not take a short-term view and compete with what it believes to be brand-damaging price discounting. The Company will continue to manage its brand for the long-term.

The Company believes it has taken appropriate action around the world to help mitigate the impact of competitive activity in a manner that will reinforce its premium brand. The Company believes retail sales of new Harley-Davidson motorcycles in the second half of 2015 will be driven by its continued demand-driving market actions that it initiated in various world markets, the continued worldwide roll-out of its Street motorcycles, ongoing international dealer expansion, the introduction of its 2016 model-year motorcycles in late August 2015 and the Company's brand strength.

The Company continues to expect 2015 operating margin percent for the Motorcycles segment to be between 18.0% and 19.0% compared to 18.0% in 2014. The Company now expects gross margin to be up modestly compared to 2014. The Company expects gross margin to be favorably impacted by motorcycle pricing and productivity gains, partially offset by unfavorable foreign currency exchange and increased pension expense. The Company now expects selling, administrative and engineering expenses to be up modestly in 2015 in absolute spending and as a percent of revenue due to recall expenses and expenses associated with its market action plan.

The Company’s earnings related to its operations outside the U.S. are impacted by changes in foreign currency exchange rates. The majority of the Company’s exposure relates to the Euro, the Australian dollar, the Japanese yen and the Brazilian real. The Company refers to these as its key foreign currencies. A weakening in foreign currencies relative to the U.S. dollar will generally have an adverse effect on revenue related to sales made in those foreign currencies offset by a corresponding positive impact from natural hedges created by the operating costs incurred in those same foreign currencies. In addition, to the extent the Company carries foreign-denominated cash, receivables or accounts payable, those amounts are also exposed to foreign currency revaluations that can impact the Company’s earnings.

39

Since the majority of the Company’s manufacturing occurs in the U.S., the Company’s operating expenses paid in foreign currencies generally include limited manufacturing costs and the selling and administrative costs incurred at the Company’s international locations. The Company uses derivative financial instruments to hedge a portion of the forecasted cash flows in its key foreign currencies. These instruments generally have terms of up to 12 months and are purchased over time so that at any point in time some portion of the next 12 months of expected foreign currency exposure is hedged. The hedging instruments allow the Company to lock in the exchange rate on future foreign currency cash flows based on the forward rates available at the time of purchase.

If foreign currency exchange rates on July 20, 2015 remained constant throughout the remainder of 2015, the Company estimates the adverse impact to its expected Motorcycles segment full-year revenue from currency exchange would be approximately 4.25%. Taking into account the Company's natural hedges and the fact that it has a significant portion its 2015 foreign currency exposure hedged at favorable rates, it expects about half of the unfavorable revenue dollar impact to translate into lower gross profit for the full year and reduce gross margin by approximately 0.75 percentage points, which is reflected in the operating margin guidance above.

If foreign currency exchange rates on July 20, 2015 remained constant throughout the third quarter of 2015, the Company estimates the adverse impact to its expected Motorcycles segment revenue from currency exchange in the thirdquarter to be approximately 5%.Taking into account the Company's natural hedges and the fact that it has a significant portion its 2015 foreign currency exposure hedged at favorable rates, it expects about 40% of the unfavorable revenue dollar impact to translate into lower gross profit and reduce gross margin by approximately 1 percentage point for the third quarter.

The Company now expects operating income for the Financial Services segment to be up modestly in 2015 as compared to 2014.

The Company continues to estimate capital expenditures for 2015 to be between $240 million and $260 million as it increases its investment in product development focused on bringing exciting new products to market and as it continues to invest in its systems infrastructure. The Company anticipates it will have the ability to fund all capital expenditures in 2015 with cash flows generated by operations.

The Company continues to expect its full-year 2015 effective income tax rate will be approximately 35.5% compared to 34.2% in 2014. The higher effective tax rate in 2015 compared to 2014 primarily reflects the absence of the U.S. Federal Research and Development tax credit that expired at the end of 2014.

Canada Distributor Transaction

On August 4, 2015, the Company purchased the assets of Fred Deeley Imports, Ltd. (Deeley Imports) and certain of its affiliates (Transaction), including among other things, the exclusive right to distribute the Company’s motorcycles and other products in Canada. The Company expects the financial impact of the Transaction and the new direct distribution model to be dilutive to 2015 earnings per share by approximately $0.04, due to upfront transition costs, with most of the impact anticipated to occur in the third quarter.⁽¹⁾ The Company expects the impact of the new direct distribution model to be accretive to earnings per share beginning in 2016 and beyond.⁽¹⁾ The potential financial impact of the Transaction and the potential new direct distribution model in Canada is not reflected in the guidance included in the "Outlook" section above.

40

Results of Operations for the Three Months Ended June 28, 2015

Compared to the Three Months Ended June 29, 2014

Consolidated Results

	Three months ended
(in thousands, except earnings per share)	June 28, 2015		June 29, 2014		(Decrease) Increase			% Change
Operating income from Motorcycles & Related Products	$	380,603	$	473,256	$	(92,653	)	(19.6	)%
Operating income from Financial Services	81,913		74,439		7,474			10.0
Operating income	462,516		547,695		(85,179		)	(15.6	)
Investment income	1,450		1,772		(322		)	(18.2	)
Interest expense	9		393		(384		)	(97.7	)
Income before income taxes	463,957		549,074		(85,117		)	(15.5	)
Provision for income taxes	164,147		194,921		(30,774		)	(15.8	)
Net income	$	299,810	$	354,153	$	(54,343	)	(15.3	)%
Diluted earnings per share	$	1.44	$	1.62	$	(0.18	)	(11.1	)%

Consolidated operating income was down 15.6% in the second quarter of 2015 due to a decrease in operating income from the Motorcycles & Related Products segment which declined by $92.7 million, or 19.6%, compared to the second quarter of 2014. Operating income from the Financial Services segment was higher during the second quarter of 2015 compared to the second quarter of 2014, increasing $7.5 million or 10.0%. Please refer to the “Motorcycles and Related Products Segment” and “Financial Services Segment” discussions following for a more detailed discussion of the factors affecting operating income.

The effective income tax rate for the second quarter of 2015 was 35.4% compared to 35.5% for the second quarter of 2014.

Diluted earnings per share was $1.44 in the second quarter of 2015, down 11.1% compared to the same period in the prior year. Diluted earnings per share decreased following the 15.3% decrease in net income, but benefited from lower diluted weighted average shares outstanding. Diluted weighted average shares outstanding decreased from 219.2 million in the second quarter of 2014 to 208.6 million in the second quarter of 2015, driven by the Company's repurchases of common stock. Please refer to "Liquidity and Capital Resources" for additional information concerning the Company's share repurchase activity.

Harley-Davidson Motorcycle Worldwide Retail Sales^(a) 

Worldwide independent dealer retail sales of Harley-Davidson motorcycles during the second quarter of 2015decreased1.4% compared to the second quarter of 2014. Retail sales of Harley-Davidson motorcycles decreased0.7% in the United States and 2.7% internationally in the second quarter of 2015.

As the Company expected, it believes that U.S. retail sales growth comparison was negatively impacted by a challenging prior year due to the very enthusiastic consumer reception for the initial Project Rushmore^TM launch. Retail sales of touring models in the second quarter of 2014 were up 31% compared to the second quarter of 2013. In addition, retail sales in the second quarter of 2014 included sales of Street 500 motorcycles sold to U.S. dealers for use in the Company's Riding Academy. The Company also believes U.S. retail sales continued to be negatively impacted by pressure from significant price discounting by most of the Company's competition. As a result of the dramatic strengthening in the U.S. dollar against world currencies, the Company believes its competitors located outside the U.S. have experienced a significant favorable financial impact allowing them to offer discounted prices to U.S. consumers. The Company expects aggressive discounting from its competition to continue for some time based on levels of competitive inventories in the retail channel coupled with foreign exchange rates that are favorable for its competitors⁽¹⁾.

Although retail sales were lower in the second quarter of 2015, the Company has continued to experience success from its latest Project Rushmore^TM models launched in August 2014 and with sales of its Street motorcycles as the Company continued its global rollout of these models.

The Company's U.S. market share of 601+cc motorcycles for the second quarter of 2015 was 47.5%, down 2.8 percentage points compared to the same period last year (Source: Motorcycle Industry Council). The Company anticipated some level of market share loss following the 13.4 percentage point increase in recent years; however, the Company's market share over the last three quarters was more severely impacted than it expected, as a result of increased price discounting by its competition and

41

the inclusion of autocycles in the industry numbers. The Company is pleased to see a moderation in market share loss from the first quarter of 2015 decline of 4.7 percentage points. The Company believes the improvement was driven by its strong brand strategy and its recent market actions to drive demand in this tough competitive environment.

Retail sales in Canada were 9.9% lower in the second quarter of 2015 compared to the second quarter of 2014 which the Company believes was driven by a highly competitive environment coinciding with the pending transition of the business from the independent distributor to direct distribution by the Company in the transaction that was completed August 4.

In the EMEA region, retail sales of Harley-Davidson motorcycles in the second quarter of 2015 decreased 8.9% compared to the prior year as the region experienced the impact of several low-priced models introduced by competitive brands and a challenging prior year comparison due to strong year-ago retail sales growth of 7.0%. The Company also experienced currency-driven volume declines in markets where it sold its motorcycles to dealers in non-local currencies, such as Russia. At the end of the second quarter of 2015, the Company's market share of 601+cc models in Europe was 10.4%, down 2.2 percentage points compared to the same period last year (Source:Association des Constructeurs Europeens de Motocycles). The Company believes the decline in its market share in Europe is due to the introduction of several low-priced models by some of its competition in the performance and standard segments, market segments where the Company's motorcycles do not compete.

Second quarter 2015 retail sales in the Asia Pacific region were up 16.6% compared to the second quarter of 2014. The region experienced growth in all major markets and, in particular, emerging markets led by India and China. The growth was driven by Street motorcycles, which were launched in several Asia Pacific markets in the first half of 2015. Retail sales in Japan were impacted by the restructuring of distribution in the market; including a new pipeline distribution process and rationalization of the dealer network to improve the customer experience. Under the new pipeline distribution process, dealer orders are fulfilled as needed through local Company-owned inventory allowing dealers to carry lower inventory levels.

The Latin America region retail sales were down2.6% in the second quarter of 2015 compared to the prior year as a result of lower retail sales in Brazil partially offset by growth in Mexico. Retail sales in the Brazil market continued to be impacted by a slowing economy, consumer uncertainty and very aggressive price competition.

While the Company remains cautious in its near-term outlook given the economic challenges in some international markets, it is confident in its current market efforts and it remains focused on its long-term growth strategies. Despite the volatility in global retail sales, the Company believes it can continue to realize international growth by prudently expanding its distribution network, building its brand experience across the world, and delivering exceptional products that the Company believes will inspire riders.⁽¹⁾ 

The following table includes retail unit sales of Harley-Davidson motorcycles:

	Three months ended
	June 30, 2015	June 30, 2014	(Decrease) Increase		% Change
North America Region
United States	57,790	58,225	(435	)	(0.7	)%
Canada	3,737	4,146	(409	)	(9.9	)%
Total North America Region	61,527	62,371	(844	)	(1.4	)%
Europe, Middle East and Africa Region (EMEA)
Europe(b)	14,150	15,726	(1,576	)	(10.0	)%
Other	2,029	2,038	(9	)	(0.4	)%
Total EMEA Region	16,179	17,764	(1,585	)	(8.9	)%
Asia Pacific Region
Japan	2,580	2,510	70		2.8	%
Other	5,937	4,792	1,145		23.9	%
Total Asia Pacific Region	8,517	7,302	1,215		16.6	%
Latin America Region	2,708	2,781	(73	)	(2.6	)%
Total Worldwide Retail Sales	88,931	90,218	(1,287	)	(1.4	)%
Total International Retail Sales	31,141	31,993	(852	)	(2.7	)%

42

(a) Data source for retail sales figures shown above is new sales warranty and registration information provided by Harley-Davidson dealers and compiled by the Company. The Company must rely on information that its dealers supply concerning retail sales and this information is subject to revision.

(b) Includes Austria, Belgium, Denmark, Finland, France, Germany, Greece, Italy, Luxembourg, Netherlands, Norway, Portugal, Spain, Sweden, Switzerland and the United Kingdom.

Motorcycles & Related Products Segment

Motorcycle Unit Shipments

The following table includes wholesale motorcycle unit shipments for the Motorcycles segment:

	Three months ended
	June 28, 2015			June 29, 2014			Unit		Unit
	Units	Mix %		Units	Mix %		(Decrease) Increase		% Change
United States	55,128	64.7	%	63,043	68.4	%	(7,915	)	(12.6	)%
International	30,044	35.3	%	29,174	31.6	%	870		3.0
Harley-Davidson motorcycle units	85,172	100.0	%	92,217	100.0	%	(7,045	)	(7.6	)%
Touring motorcycle units	34,563	40.6	%	41,095	44.6	%	(6,532	)	(15.9	)%
Cruiser motorcycle units(a)	29,952	35.2	%	32,231	34.9	%	(2,279	)	(7.1	)
Sportster® / Street motorcycle units	20,657	24.2	%	18,891	20.5	%	1,766		9.3
Harley-Davidson motorcycle units	85,172	100.0	%	92,217	100.0	%	(7,045	)	(7.6	)%

(a) Category previously referred to as "Custom" motorcycle units, as used in this table, include Dyna^®, Softail^®, V-Rod^® and CVO models.

The Company shipped 85,172 Harley-Davidson motorcycles worldwide during the second quarter of 2015, which was 7.6%lower than the second quarter of 2014 and in line with Company expectations.

Shipments of Sportster^® / Street motorcycles as a percentage of total shipments increased in the second quarter of 2015 compared to the prior year while shipments of Touring and Cruiser motorcycles as a percentage of total shipments decreased. The higher shipment mix of Sportster^® / Street motorcycles was driven by shipments of the Company's Street models as it continues its global roll-out of these models.

U.S. dealer retail inventory of Harley-Davidson motorcycles was approximately 1,600 units lower at the end of the second quarter of 2015 compared to the same time last year. Excluding incremental retail dealer fill of Street motorcycles, second quarter 2015 retail inventory of Harley-Davidson motorcycles was down significantly, as the Company expected. The Company believes the overall U.S. retail inventory of Harley-Davidson motorcycles was appropriate and reflects its flexible manufacturing capabilities and its commitment to manage supply in line with demand.

43

Segment Results

The following table includes the condensed statements of operations for the Motorcycles segment (in thousands):

	Three months ended
	June 28, 2015		June 29, 2014		(Decrease) Increase			% Change
Revenue:
Motorcycles	$	1,308,837	$	1,480,914	$	(172,077	)	(11.6	)%
Parts & Accessories	256,840		271,572		(14,732		)	(5.4	)
General Merchandise	77,518		76,386		1,132			1.5
Other	7,588		5,413		2,175			40.2
Total revenue	1,650,783		1,834,285		(183,502		)	(10.0	)
Cost of goods sold	1,003,569		1,110,146		(106,577		)	(9.6	)
Gross profit	647,214		724,139		(76,925		)	(10.6	)
Selling & administrative expense	228,148		218,410		9,738			4.5
Engineering expense	38,463		32,473		5,990			18.4
Operating expense	266,611		250,883		15,728			6.3
Operating income from Motorcycles	$	380,603	$	473,256	$	(92,653	)	(19.6	)%

The following table includes the estimated impact of significant factors affecting the comparability of net revenue, cost of goods sold and gross profit from the second quarter of 2014 to the second quarter of 2015 (in millions):

	Net Revenue			Cost of Goods Sold			Gross Profit
Three months ended June 29, 2014	$	1,834.3		$	1,110.2		$	724.1
Volume	(119.3		)	(73.3		)	(46.0		)
Price, net of related cost	20.4			1.8			18.6
Foreign currency exchange rates and hedging	(80.0		)	(43.9		)	(36.1		)
Shipment mix	(4.6		)	11.9			(16.5		)
Raw material prices	—			(4.3		)	4.3
Manufacturing and other costs	—			1.2			(1.2		)
Total	(183.5		)	(106.6		)	(76.9		)
Three months ended June 28, 2015	$	1,650.8		$	1,003.6		$	647.2

The following factors affected the comparability of net revenue, cost of goods sold and gross profit from the second quarter of 2014 to the second quarter of 2015:

• Volume decreases were driven by the planned decrease in wholesale motorcycle shipments and lower parts and accessories sales, partially offset by higher sales volumes for general merchandise.

• On average, wholesale prices for the Company’s 2015 model-year motorcycles are higher than the prior model-year resulting in the favorable impact on revenue during the period. The impact of revenue favorability resulting from model-year price increases on gross profit was partially offset by an increase in cost related to the additional content added to the 2015 model-year motorcycles.

• Gross profit was negatively impacted by changes in foreign currency exchange rates during the second quarter of 2015 compared to the second quarter of 2014. Revenue was negatively impacted by a devaluation in the Euro, Japanese yen, Brazilian real and Australian dollar. On a weighted average basis, these key currencies were weaker by 19% in the second quarter of 2015 compared to the second quarter of 2014. The negative impact to revenue was partially offset by a positive impact to cost of goods sold as a result of natural hedges, benefits of foreign currency exchange contracts and the revaluation of foreign-denominated assets on the balance sheet.

• As expected, shipment mix changes negatively impacted net revenue and gross profit in the second quarter of 2015 primarily as a result of the shift in mix between motorcycle families.

• Raw material prices were slightly lower in the second quarter of 2015 relative to the second quarter of 2014.

44

• Manufacturing costs in the second quarter of 2015 were higher primarily due to an increase in the cost per unit resulting from the lower production volumes partially offset by strong productivity gains and the absence of Street motorcycle start-up costs that were incurred in the second quarter of 2014.

The net increase in operating expenses was primarily due to increased marketing costs as the Company addressed the highly competitive environment. Operating expense in the second quarter of 2015 also included recall costs of $16.4 million.

Financial Services Segment

Segment Results

The following table includes the condensed statements of operations for the Financial Services segment (in thousands):

	Three months ended
	June 28, 2015		June 29, 2014		Increase (Decrease)			% Change
Interest income	$	150,284	$	145,202	$	5,082		3.5	%
Other income	23,325		21,212		2,113			10.0
Financial Services revenue	173,609		166,414		7,195			4.3
Interest expense	41,188		40,741		447			1.1
Provision for credit losses	15,175		15,961		(786		)	(4.9	)
Operating expenses	35,333		35,273		60			0.2
Financial Services expense	91,696		91,975		(279		)	(0.3	)
Operating income from Financial Services	$	81,913	$	74,439	$	7,474		10.0	%

Interest income for the second quarter of 2015 increased primarily due to higher average receivables in the wholesale and retail portfolios, partially offset by lower yields primarily on retail finance receivables due to increased competition. Other income was favorable primarily due to increased credit card licensing and insurance revenue. Other income now includes international income which had previously been reported in interest income. Prior period amounts, which were not material, have been adjusted for comparability.

Interest expense for the second quarter of 2015 increased slightly due to higher average outstanding debt, partially offset by a lower cost of funds and a $1.1 million loss on the extinguishment of medium-term notes recorded in the second quarter of 2014.

The provision for credit losses decreased $0.8 million in second quarter of 2015 as compared to the second quarter of 2014. The retail motorcycle provision increased $0.5 million in the second quarter of 2015 primarily as a result of higher credit losses. Credit losses were impacted by increased sub-prime originations in recent years, as well as changing consumer credit behavior. The wholesale provision decreased by $1.4 million due to a decrease in receivables and lower reserve rates.

Changes in the allowance for credit losses on finance receivables were as follows (in thousands):

	Three months ended
	June 28, 2015			June 29, 2014
Balance, beginning of period	$	132,820		$	114,529
Provision for finance credit losses	15,175			15,961
Charge-offs	(21,003		)	(19,018		)
Recoveries	12,239			10,883
Balance, end of period	$	139,231		$	122,355

45

Results of Operations for the Six Months EndedJune 28, 2015

Compared to the Six Months EndedJune 29, 2014

Consolidated Results

	Six months ended
(in thousands, except earnings per share)	June 28, 2015		June 29, 2014		(Decrease) Increase			% Change
Operating income from Motorcycles & Related Products	$	726,057	$	820,948	$	(94,891	)	(11.6	)%
Operating income from Financial Services	146,577		137,629		8,948			6.5
Operating income	872,634		958,577		(85,943		)	(9.0	)
Investment income	2,772		3,431		(659		)	(19.2	)
Interest expense	18		4,070		(4,052		)	(99.6	)
Income before income taxes	875,388		957,938		(82,550		)	(8.6	)
Provision for income taxes	305,724		337,868		(32,144		)	(9.5	)
Net income	$	569,664	$	620,070	$	(50,406	)	(8.1	)%
Diluted earnings per share	$	2.71	$	2.82	$	(0.11	)	(3.9	)%

Consolidated operating income was down9.0% in the first six months of 2015 led by a decrease in operating income from the Motorcycles segment which declined by $94.9 million, or 11.6%, compared to the first six months of 2014. Operating income for the Financial Services segment improved by $8.9 million in the first six months of 2015 compared to the first six months of 2014. Please refer to the “Motorcycles and Related Products Segment” and “Financial Services Segment” discussions following for a more detailed discussion of the factors affecting operating income.

Interest expense was lower in the first six months of 2015 compared to the first six months of 2014 due to the repayment of $303 million of senior unsecured long-term debt in February 2014.

The effective income tax rate for the first six months of 2015 was 34.9% compared to 35.3% for the first six months of 2014. The lower effective tax rate in 2015 primarily reflects a higher projected tax benefit from the U.S. manufacturing deduction.

Diluted earnings per share was $2.71 in the first six months of 2015, down3.9% from the same period in the prior year. The decrease in diluted earnings per share was driven by the 8.1%decrease in net income. Diluted earnings per share benefited from lower diluted weighted average shares outstanding. Diluted weighted average shares outstanding decreased from 219.8 million in the first six months of 2014 to 210.2 million in the first six months of 2015, driven by the Company's repurchases of common stock. Please refer to "Liquidity and Capital Resources" for additional information concerning the Company's share repurchase activity.

Motorcycles Retail Sales and Registration Data

Worldwide independent dealer retail sales of Harley-Davidson motorcycles decreased1.4% during the first half of 2015 compared to the first half of 2014, during which retail sales were up 4.2% compared to 2013. Retail sales of Harley-Davidson motorcycles decreased0.7% in the United States and decreased 2.5% internationally in the first half of 2015.

U.S. retail sales were negatively impacted by continued pressure from significant price discounting by most of the Company's competition. As the Company expected, it also believes that the U.S. retail sales year-over-year growth comparison was negatively impacted by the very enthusiastic consumer reception in 2014 for the initial Project Rushmore^TM launch.

The Company continued to experience success in the first half of 2015 with its latest Project Rushmore^TM models launched in August 2014 and with U.S. retail sales of its Street motorcycles.

The Company's U.S. market share of 601+cc models at the end of the first six months of 2015 was 48.8%, down 3.5 percentage points compared to the same period last year (Source: Motorcycle Industry Council). The Company anticipated some level of market share loss following the 13.4 percentage point increase in recent years; however, the Company's market share over the last three quarters was more severely impacted than it expected, as a result of increased price discounting by its competition and the inclusion of autocycles in the industry numbers.

Retail sales in the first six months of 2015 in the EMEA region were down7.7%compared to the first six months of 2014 due to a strong increase in 2014 which was up 7.5% compared to the first six months of 2013. The Company believes that the

46

lower 2015 retail sales were primarily due to new low-priced models introduced by competitive brands and currency driven volume declines in markets where the Company sold its motorcycles to dealers in non-local currencies, such as in Russia.At the end of the first six months of 2015, the Company's market share of 601+cc models in Europe was 10.2%, down 1.9 percentage points compared to the same period last year (Source:Association des Constructeurs Europeens de Motocycles). The Company believes the decline in its market share in Europe is due to the introduction of several low-priced models by some of its competition in the standard and performance segments, market segments where the Company's motorcycles do not compete.

In the Asia-Pacific region, retail sales increased 7.8% in the first six months of 2015 compared to the same period last year following prior year retail sales growth of 10.1%. The increase in 2015 was driven by growth in emerging markets led by India and China. The increase was driven by Street motorcycles which launched in several Asia Pacific markets in the first half of 2015. Retail sales in Japan were impacted by the restructuring of distribution in the market.

Latin America region retail sales in the first six months of 2015 were down 1.2% compared to the first six months of 2014 primarily due to a decline in Brazil, largely offset by growth in Mexico. The Company believes retail sales in Brazil in the first six months of 2015 were negatively impacted by a slowing economy, consumer uncertainty and aggressive price competition.

Retail sales in Canada were down4.8%in the first six months of 2015 compared to the same period last year. The Company believes the decrease is a result of a highly competitive environmentcoinciding with the pending transition of the business from the independent distributor to direct distribution by the Company that was completed on August 4.

Worldwide Harley-Davidson Motorcycle Retail Sales^(a) 

The following table includes retail unit sales of Harley-Davidson motorcycles:

	Six months ended
	June 30, 2015	June 30, 2014	(Decrease) Increase		% Change
North America Region
United States	93,278	93,955	(677	)	(0.7	)%
Canada	5,860	6,155	(295	)	(4.8	)
Total North America Region	99,138	100,110	(972	)	(1.0	)
Europe, Middle East and Africa Region (EMEA)
Europe(b)	22,279	24,121	(1,842	)	(7.6	)
Other	3,288	3,583	(295	)	(8.2	)
Total EMEA Region	25,567	27,704	(2,137	)	(7.7	)
Asia Pacific Region
Japan	4,552	5,403	(851	)	(15.8	)
Other	11,062	9,077	1,985		21.9
Total Asia Pacific Region	15,614	14,480	1,134		7.8
Latin America Region	5,273	5,339	(66	)	(1.2	)
Total Worldwide Retail Sales	145,592	147,633	(2,041	)	(1.4	)%
Total International Retail Sales	52,314	53,678	(1,364	)	(2.5	)%

(a) Data source for retail sales figures shown above is new sales warranty and registration information provided by Harley-Davidson dealers and compiled by the Company. The Company must rely on information that its dealers supply concerning retail sales and this information is subject to revision.

(b) Includes Austria, Belgium, Denmark, Finland, France, Germany, Greece, Italy, Luxembourg, Netherlands, Norway, Portugal, Spain, Sweden, Switzerland and the United Kingdom.

47

Motorcycle Registration Data^(a) 

The following table includes industry retail motorcycle registration data:

	Six months ended
	June 30, 2015	June 30, 2014	Increase	% Change
United States(b)	187,163	173,960	13,203	7.6	%
Europe(c)	229,469	209,218	20,251	9.7	%

(a) Data includes on-road 601+cc models. On-road 601+cc models include on-highway, dual purpose models and three-wheeled vehicles. Registration data for Harley-Davidson Street 500^TM motorcycles is not included in this table.

(b) United States industry data is derived from information provided by Motorcycle Industry Council (MIC). This third party data is subject to revision and update.

(c) Europe data includes Austria, Belgium, Denmark, Finland, France, Germany, Greece, Italy, Luxembourg, Netherlands, Norway, Portugal, Spain, Sweden, Switzerland, and the United Kingdom. Industry retail motorcycle registration data includes 601+cc models derived from information provided by Association des Constructeurs Europeens de Motocycles (ACEM), an independent agency. This third-party data is subject to revision and update.

Motorcycles & Related Products Segment

Motorcycle Unit Shipments

The following table includes wholesale motorcycle unit shipments for the Motorcycles segment:

	Six months ended
	June 28, 2015			June 29, 2014			Unit		Unit
	Units	Mix %		Units	Mix %		(Decrease) Increase		% Change
United States	111,792	67.9	%	117,334	67.9	%	(5,542	)	(4.7	)%
International	52,969	32.1	%	55,565	32.1	%	(2,596	)	(4.7	)
Harley-Davidson motorcycle units	164,761	100.0	%	172,899	100.0	%	(8,138	)	(4.7	)%
Touring motorcycle units	73,360	44.5	%	77,273	44.7	%	(3,913	)	(5.1	)%
Cruiser motorcycle units(a)	53,348	32.4	%	61,380	35.5	%	(8,032	)	(13.1	)
Sportster® / Street motorcycle units(b)	38,053	23.1	%	34,246	19.8	%	3,807		11.1
Harley-Davidson motorcycle units	164,761	100.0	%	172,899	100.0	%	(8,138	)	(4.7	)%

(a) Category previously referred to as "Custom" motorcycle units, as used in this table, include Dyna^®, Softail^®, V-Rod^® and CVO models.

(b) Initial shipments of Street motorcycle units began during the first quarter of 2014.

The Company shipped 164,761 motorcycles worldwide during the first half of 2015, which was 4.7% lower than the first half of 2014. International shipments as a percent of total shipments was 32.1% in the first six months of 2015 and for the first six months of 2014. The Company continues to believe that international retail sales will grow at a faster rate than domestic retail sales over the next few years.⁽¹⁾ 

The shipment mix percentage of Touring motorcycles in the first six months of 2015 was largely flat while shipment mix percentage of Sportster^® / Street motorcycles increased in the first six months of 2015 offset by a decrease in Cruiser motorcycles compared to the same period last year.

48

Segment Results

The following table includes the condensed statements of operations for the Motorcycles segment (in thousands):

	Six months ended
	June 28, 2015		June 29, 2014		(Decrease) Increase			% Change
Revenue:
Motorcycles	$	2,563,958	$	2,785,953	$	(221,995	)	(8.0	)%
Parts & Accessories	440,712		469,707		(28,995		)	(6.2	)
General Merchandise	143,946		140,500		3,446			2.5
Other	12,737		9,813		2,924			29.8
Total revenue	3,161,353		3,405,973		(244,620		)	(7.2	)
Cost of goods sold	1,923,864		2,089,703		(165,839		)	(7.9	)
Gross profit	1,237,489		1,316,270		(78,781		)	(6.0	)
Selling & administrative expense	433,655		429,585		4,070			0.9
Engineering expense	77,777		65,737		12,040			18.3
Operating expense	511,432		495,322		16,110			3.3
Operating income from Motorcycles	$	726,057	$	820,948	$	(94,891	)	(11.6	)%

The following table includes the estimated impact of significant factors affecting the comparability of net revenue, cost of goods sold and gross profit from the first half of 2014 to the first half of 2015 (in millions):

	Net Revenue			Cost of Goods Sold			Gross Profit
Six months ended June 29, 2014	$	3,406.0		$	2,089.7		$	1,316.3
Volume	(143.0		)	(88.7		)	(54.3		)
Price, net of related costs	38.6			4.0			34.6
Foreign currency exchange rates and hedging	(133.7		)	(58.2		)	(75.5		)
Shipment mix	(6.5		)	0.9			(7.4		)
Raw material prices	—			(6.4		)	6.4
Manufacturing and other costs	—			(17.4		)	17.4
Total	(244.6		)	(165.8		)	(78.8		)
Six months ended June 28, 2015	$	3,161.4		$	1,923.9		$	1,237.5

The following factors affected the comparability of net revenue, cost of goods sold and gross profit from the first half of 2014 to first half of 2015:

• Volume decreases were driven by the decrease in wholesale motorcycle shipments and parts and accessories sales, partially offset by higher sales volumes for general merchandise.

• On average, wholesale prices for the Company’s 2015 model-year motorcycles are higher than the prior model-year resulting in the favorable impact on revenue during the period. The impact of revenue favorability resulting from model-year price increases on gross profit was partially offset by increases in costs related to the additional content added to the 2015 model-year motorcycles.

• Gross profit was negatively impacted by changes in foreign currency exchange rates during the first six months of 2015 compared to the first six months of 2014. Revenue was negatively impacted by a devaluation in the Euro, Japanese yen, Brazilian real and Australian dollar. The negative impact to revenue was partially offset by a positive impact to cost of goods sold as a result of natural hedges and benefits of foreign currency exchange contracts, partially offset by an unfavorable impact due to the revaluation of foreign-denominated assets on the balance sheet.

• Shipment mix changes negatively impacted gross profit primarily due to changes in motorcycle family mix, driven by higher shipments of Street motorcycles. The negative motorcycle family mix was partially offset by positive mix changes within parts and accessories and general merchandise.

• Raw material prices were lower in the first half of 2015 relative to the first half of 2014.

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• Manufacturing costs in the first six months of 2015 benefited from increased manufacturing efficiencies and the absence of Street motorcycle start-up costs that were incurred in the first six months of 2014, partially offset by a higher cost per unit resulting from lower production volumes.

The net increase in operating expense was primarily due to increased marketing costs as the Company responded to the highly competitive environment and higher recall costs.

Financial Services Segment

Segment Results

The following table includes the condensed statements of operations for the Financial Services segment (in thousands):

	Six months ended
	June 28, 2015		June 29, 2014		Increase (Decrease)		% Change
Interest income	$	293,852	$	284,254	$	9,598	3.4	%
Other income	42,132		36,520		5,612		15.4
Financial Services revenue	335,984		320,774		15,210		4.7
Interest expense	79,724		79,598		126		0.2
Provision for credit losses	41,422		36,292		5,130		14.1
Operating expenses	68,261		67,255		1,006		1.5
Financial Services expense	189,407		183,145		6,262		3.4
Operating income from Financial Services	$	146,577	$	137,629	$	8,948	6.5	%

Interest income was higher in the first six months of 2015 due to higher average receivables in the retail and wholesale portfolios compared to the first six months of 2014, partially offset by lower yields primarily due to increased competition. Other income was favorable primarily due to increased credit card licensing and insurance revenue. Other income now includes international income which had previously been reported in interest income. Prior period amounts, which were not material, have been adjusted for comparability.

Interest expense increased slightly primarily due to higher average outstanding debt, partially offset by a lower cost of funds and a $1.1 million loss on the extinguishment of medium-term notes recorded during the first six months of 2014.

The provision for credit losses increased $5.1 million in the first six months of 2015. The retail motorcycle provision increased $5.9 million in the first six months of 2015 primarily as a result of higher credit losses and an increase in retail receivables. Credit losses were higher as a result of increased sub-prime originations in recent years, as well as changing consumer credit behavior. The wholesale provision was favorable by $0.8 million due primarily to a smaller increase in receivables in the first six months of 2015 as compared to 2014.

On a year-to-date basis, retail loan originations were comprised of approximately 80% prime loans and 20% sub-prime. Sub-prime originations represent a significant amount of retail sales to the Company at attractive returns which further reinforces the competitive advantage that HDFS brings to the Company.

Annualized losses on HDFS' retail motorcycle loans were 1.08% through June 28, 2015 compared to 0.97% through June 29, 2014. The 30-day delinquency rate for retail motorcycle loans at June 28, 2015 was 2.71% compared to 2.68% at June 29, 2014.

Changes in the allowance for credit losses on finance receivables were as follows (in thousands):

	Six months ended
	June 28, 2015			June 29, 2014
Balance, beginning of period	$	127,364		$	110,693
Provision for credit losses	41,422			36,292
Charge-offs	(53,736		)	(46,361		)
Recoveries	24,181			21,731
Balance, end of period	$	139,231		$	122,355

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Other Matters

Contractual Obligations

The Company has updated the contractual obligations table under the caption “Contractual Obligations” in Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations of the Company’s Annual Report on Form 10-K for the year ended December 31, 2014 as of June 28, 2015 to reflect the new projected principal and interest payments for the remainder of 2015 and beyond as follows (in thousands):

	2015		2016 - 2017		2018 - 2019		Thereafter		Total
Principal payments on debt	$	1,216,387	$	1,951,101	$	2,367,006	$	692,206	$	6,226,700
Interest payments on debt	87,666		227,144		94,906		1,940		411,656
	$	1,304,053	$	2,178,245	$	2,461,912	$	694,146	$	6,638,356

Interest obligations for floating rate instruments, as calculated above, assume rates in effect at June 28, 2015 remain constant.

As of June 28, 2015, there have been no other material changes to the Company’s summary of expected payments for significant contractual obligations in the contractual obligations table.

Commitments and Contingencies

The Company is subject to lawsuits and other claims related to environmental, product and other matters. In determining required reserves related to these items, the Company carefully analyzes cases and considers the likelihood of adverse judgments or outcomes, as well as the potential range of possible loss. The required reserves are monitored on an ongoing basis and are updated based on new developments or new information in each matter.

Environmental Protection Agency Notice

In December 2009, the Company received formal, written requests for information from the United States Environmental Protection Agency (EPA) regarding: (i) certificates of conformity for motorcycle emissions and related designations and labels, (ii) aftermarket parts, and (iii) warranty claims on emissions related components. The Company promptly submitted written responses to the EPA’s inquiry and has engaged in discussions with the EPA. Since that time, the EPA has delivered various additional requests for information to which the Company has responded. It is probable that a result of the EPA’s investigation will be some form of enforcement action by the EPA that will seek a fine and/or other relief. The Company has a reserve associated with this matter which is included in accrued liabilities in the Consolidated Balance Sheet. However, given the uncertainty that still exists concerning the resolution of this matter, there is a possibility that the actual loss incurred may be materially different from the Company’s current reserve. At this time, the Company cannot reasonably estimate the impact of any remedies the EPA might seek beyond the Company's current reserve for this matter, if any.

York Environmental Matters:

The Company is involved with government agencies and groups of potentially responsible parties in various environmental matters, including a matter involving the cleanup of soil and groundwater contamination at its York, Pennsylvania facility. The York facility was formerly used by the U.S. Navy and AMF prior to the purchase of the York facility by the Company from AMF in 1981. Although the Company is not certain as to the full extent of the environmental contamination at the York facility, it has been working with the Pennsylvania Department of Environmental Protection (PADEP) since 1986 in undertaking environmental investigation and remediation activities, including an ongoing site-wide remedial investigation/feasibility study (RI/FS). In January 1995, the Company entered into a settlement agreement (the Agreement) with the Navy, and the parties amended the Agreement in 2013 to address ordnance and explosive waste. The Agreement calls for the Navy and the Company to contribute amounts into a trust equal to 53% and 47%, respectively, of future costs associated with environmental investigation and remediation activities at the York facility (Response Costs). The trust administers the payment of the Response Costs incurred at the York facility as covered by the Agreement.

The Company has a reserve for its estimate of its share of the future Response Costs at the York facility which is included in accrued liabilities in the Condensed Consolidated Balance Sheets. As noted above, the RI/FS is still underway and given the uncertainty that exists concerning the nature and scope of additional environmental investigation and remediation that may ultimately be required under the RI/FS or otherwise at the York facility, the Company is unable to make a reasonable estimate of those additional costs, if any, that may result.

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The estimate of the Company’s future Response Costs that will be incurred at the York facility is based on reports of independent environmental consultants retained by the Company, the actual costs incurred to date and the estimated costs to complete the necessary investigation and remediation activities. Response Costs are expected to be paid primarily over a period of several years ending in 2017 although certain Response Costs may continue for some time beyond 2017.

Product Liability Matters:

The Company is involved in product liability suits related to the operation of its business. The Company accrues for claim exposures that are probable of occurrence and can be reasonably estimated. The Company also maintains insurance coverage for product liability exposures. The Company believes that its accruals and insurance coverage are adequate and that product liability suits will not have a material adverse effect on the Company’s consolidated financial statements.⁽¹⁾ 

Liquidity and Capital Resources as of June 28, 2015⁽¹⁾ 

Over the long-term, the Company expects that its business model will continue to generate cash that will allow it to invest in the business, fund future growth opportunities and return value to shareholders⁽¹⁾. The Company will evaluate opportunities to enhance value for its shareholders through increasing dividends and repurchasing shares. The Company believes the Motorcycles operations will continue to be primarily funded through cash flows generated by operations⁽¹⁾. The Financial Services operations have been funded with unsecured debt, unsecured commercial paper, asset-backed commercial paper conduit facilities, committed unsecured bank facilities, term asset-backed securitizations, and intercompany borrowings.

The Company’s strategy is to maintain a minimum of twelve months of its projected liquidity needs through a combination of cash and marketable securities and availability under credit facilities. The following table summarizes the Company’s cash and marketable securities and availability under credit facilities (in thousands):

	June 28, 2015
Cash and cash equivalents	$	1,247,579
Current marketable securities	52,516
Total cash and cash equivalents and marketable securities	1,300,095
Global credit facilities	1,235,017
Asset-backed U.S. commercial paper conduit facility(a)	600,000
Asset-backed Canadian commercial paper conduit facility(b)	10
Total availability under credit facilities	1,835,027
Total	$	3,135,122

(a) The U.S. commercial paper conduit facility expires on October 30, 2015. The Company anticipates that it will renew this facility prior to expiration⁽¹⁾.

(b) The Canadian commercial paper conduit facility was due to expire on June 30, 2015 and is limited to Canadian-denominated borrowings. The Company renewed this facility and the new facility expires June 30, 2016.

The Company continues to monitor and adjust to changes in the lending environment for its Financial Services operations. The Company intends to continue with a diversified funding profile through a combination of short-term and long-term funding vehicles and to pursue a variety of sources to obtain cost-effective funding. The Financial Services operations could be negatively affected by higher costs of funding and increased difficulty of raising or potential unsuccessful efforts to raise funding in the short-term and long-term capital markets. These negative consequences could in turn adversely affect the Company’s business and results of operations in various ways, including through higher costs of capital, reduced funds available through its Financial Services operations to provide loans to independent dealers and their retail customers, and dilution to existing shareholders through the use of alternative sources of capital.

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Cash Flow Activity

The following table summarizes the cash flow activity for the periods indicated (in thousands):

	Six months ended
	June 28, 2015			June 29, 2014
Net cash provided by operating activities	$	613,944		$	570,592
Net cash used by investing activities	(481,701		)	(419,759		)
Net cash provided by (used by) financing activities	214,351			(223,082		)
Effect of exchange rate changes on cash and cash equivalents	(5,695		)	4,983
Net increase (decrease) in cash and cash equivalents	$	340,899		$	(67,266	)

Operating Activities

The increase in cash provided by operating activities for the first six months of 2015 compared to the first six months of 2014 was due in part to lower net cash outflows for wholesale lending. No contributions to qualified pension plans are required or planned in 2015⁽¹⁾. The Company expects it will continue to make on-going contributions related to current benefit payments for SERPA and postretirement healthcare plans.

Investing Activities

The Company’s investing activities consist primarily of capital expenditures, net changes in finance receivables and short-term investment activity. Capital expenditures were $85.2 million in the first six months of 2015 compared to $74.5 million in the same period last year. Net cash outflows for finance receivables for the first six months of 2015 were $19.7 million higher than in the same period last year as a result of an increase in retail motorcycle loan originations during the first six months of 2014. A net decrease in marketable securities during the first six months of 2014 resulted in higher investing cash inflows of approximately $36.5 million compared to the first six months of 2015.

Financing Activities

The Company’s financing activities consist primarily of share repurchases, dividend payments and debt activity. Cash outflows for share repurchases were $358.4 million in the first six months of 2015 compared to $223.7 million in the same period last year. Share repurchases during the first six months of 2015 included 5.9 million shares of common stock related to discretionary share repurchases as well as shares of common stock that employees surrendered to satisfy withholding taxes in connection with the vesting of restricted stock awards. As of June 28, 2015, there were 31.0 million shares remaining on board-approved share repurchase authorizations.

The Company paid dividends of $0.620 and $0.550 per share totaling $129.7 million and $120.6 million during the first six months of 2015 and 2014, respectively.

Financing cash flows related to debt activity resulted in net cash inflows of $724.6 million in the first six months of 2015 compared to net cash inflows of $94.6 million in the first six months of 2014. During the second quarter of 2015, the Company issued $500.0 million of secured notes through a term asset-backed securitization transaction. During the second quarter of 2014, the Company issued $850.0 million of secured notes through a term asset-backed securitization transaction. The Company’s total outstanding debt consisted of the following (in thousands):

	June 28, 2015		June 29, 2014
Unsecured commercial paper	$	114,983	$	619,622
Asset-backed Canadian commercial paper conduit facility	160,940		173,224
Medium-term notes	3,933,698		2,853,232
Term asset-backed securitization debt	2,017,079		1,712,855
Total debt	$	6,226,700	$	5,358,933

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To access the debt capital markets, the Company relies on credit rating agencies to assign short-term and long-term credit ratings. Generally, lower credit ratings result in higher borrowing costs and reduced access to debt capital markets. A credit rating agency may change or withdraw the Company’s ratings based on its assessment of the Company’s current and future ability to meet interest and principal repayment obligations. The Company’s short-term debt ratings affect its ability to issue unsecured commercial paper. The Company’s short- and long-term debt ratings as of June 28, 2015 were as follows:

	Short-Term	Long-Term	Outlook
Moody’s	P2	A3	Stable
Standard & Poor’s	A2	A-	Stable
Fitch	F1	A	Stable

Global Credit Facilities – On April 7, 2014, the Company entered into a new $675.0 million five-year credit facility to refinance and replace a $675.0 million four-year credit facility that was due to mature in April 2015. The new five-year credit facility matures in April 2019. The Company also has a $675.0 million five-year credit facility which matures in April 2017. The new five-year credit facility and the existing five-year credit facility (together, the Global Credit Facilities) bear interest at variable interest rates, which may be adjusted upward or downward depending on certain criteria, such as credit ratings. The Global Credit Facilities also require the Company to pay a fee based on the average daily unused portion of the aggregate commitments under the Global Credit Facilities. The Global Credit Facilities are committed facilities and primarily used to support the Company's unsecured commercial paper program.

Unsecured Commercial Paper – Subject to limitations, the Company could issue unsecured commercial paper of up to $1.35 billion as of June 28, 2015 supported by the Global Credit Facilities, as discussed above. Outstanding unsecured commercial paper may not exceed the unused portion of the Global Credit Facilities. Maturities may range up to 365 days from the issuance date. The Company intends to repay unsecured commercial paper as it matures with additional unsecured commercial paper or through other means, such as borrowing under the Global Credit Facilities, borrowing under its asset-backed U.S. commercial paper conduit facility or through the use of operating cash flow and cash on hand.⁽¹⁾ 

Medium-Term Notes – The Company had the following medium-term notes (collectively, the Notes) issued and outstanding at June 28, 2015 (in thousands):

Principal Amount	Rate	Issue Date	Maturity Date
$600,000	1.15%	September 2012	September 2015
$450,000	3.88%	March 2011	March 2016
$400,000	2.70%	January 2012	March 2017
$400,000	1.55%	November 2014	November 2017
$887,958	6.80%	May 2008	June 2018
$600,000	2.40%	September 2014	September 2019
$600,000	2.15%	February 2015	February 2020

The Notes provide for semi-annual interest payments and principal due at maturity. Unamortized discounts on the Notes reduced the outstanding balance by $4.3 million and $1.2 million at June 28, 2015 and June 29, 2014, respectively.

There were no medium-term notes issued or repurchased during the second quarter of 2015. During the first quarter of 2015, the Company issued $600.0 million of medium-term notes which mature in 2020 and have an annual interest rate of 2.15%. There were no medium-term notes issued during the first half of 2014. During the second quarter of 2014, HDFS repurchased an aggregate of $6.1 million of its 6.80% medium-term notes which mature in June 2018. As a result, HDFS recognized in financial services interest expense $1.1 million in loss on the extinguishment of debt, which included unamortized discounts and fees.

Senior Unsecured Notes – In February 2009, the Company issued $600.0 million of senior unsecured notes in an underwritten offering. The senior unsecured notes provided for semi-annual interest payments and principal due at maturity. During the fourth quarter of 2010, the Company repurchased $297.0 million of the $600.0 million senior unsecured notes at a price of $380.8 million. The senior unsecured notes matured in February 2014 and the Company repaid the remaining senior unsecured notes outstanding.

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In July 2015, the Company issued $750.0 million of senior unsecured notes in an underwritten offering. The senior unsecured notes provide for semi-annual interest payments and principal due at maturity. $450.0 million of the senior unsecured notes mature in July 2025 and have an interest rate of 3.50%, and $300.0 million of the senior unsecured notes mature in July 2045 and have an interest rate of 4.625%. The Company intends to use the proceeds from the debt to repurchase shares of its common stock.⁽¹⁾ The Company expects to complete the share repurchases by the end of 2015.⁽¹⁾ The share repurchases will be in addition to repurchases under the Company's ongoing share repurchase plan which it expects to be in line with the second half of 2014 repurchases of $392 million.⁽¹⁾ 

Asset-Backed Canadian Commercial Paper Conduit Facility –The Company has a revolving facility agreement (Canadian Conduit) with a Canadian bank-sponsored asset-backed commercial paper conduit. Under the agreement, the Canadian Conduit is contractually committed, at the Company's option, to purchase from the Company eligible Canadian retail motorcycle finance receivables for proceeds up to C$200 million. The transferred assets are restricted as collateral for the payment of the debt. The terms for this facility provide for interest on the outstanding principal based on prevailing market interest rates plus a specified margin. The Canadian Conduit also provides for a program fee and an unused commitment fee based on the unused portion of the total aggregate commitment of C$200 million. There is no amortization schedule; however, the debt is reduced monthly as available collections on the related finance receivables are applied to outstanding principal. Upon expiration of the Canadian Conduit, any outstanding principal will continue to be reduced monthly through available collections. Unless earlier terminated or extended by mutual agreement of the Company and the lenders, as of June 28, 2015, the Canadian Conduit had an expiration date of June 30, 2015. The Canadian Conduit was renewed on June 30, 2015 with similar terms and a borrowing amount of up to C$240 million with an expiration date of June 30, 2016. The contractual maturity of the debt is approximately 5 years.

During the first and second quarters of 2015, the Company transferred $19.2 million and $26.8 million of Canadian retail motorcycle finance receivables to the Canadian Conduit for proceeds of $16.8 million and $23.4 million, respectively. During the first and second quarters of 2014, HDFS transferred $15.7 million and $26.4 million of Canadian retail motorcycle finance receivables to the Canadian Conduit for proceeds of$13.8 million and $23.1 million, respectively.

Asset-Backed U.S. Commercial Paper Conduit Facility VIE – In September 2014, the Company amended and restated its revolving facility (U.S. Conduit) with an asset-backed U.S. commercial paper conduit, which provides for a total aggregate commitment of $600.0 million. At June 28, 2015 and June 29, 2014, the Company had no outstanding borrowings under the U.S. Conduit.

This debt provides for interest on outstanding principal based generally on prevailing commercial paper rates plus a program fee based on outstanding principal, or LIBOR plus a specified margin to the extent the advance is not funded by a conduit lender through the issuance of commercial paper. The U.S. Conduit also provides for an unused commitment fee based on the unused portion of the total aggregate commitment of $600.0 million. There is no amortization schedule; however, the debt is reduced monthly as available collections on the related finance receivable collateral are applied to outstanding principal. Upon expiration of the U.S. Conduit, any outstanding principal will continue to be reduced monthly through available collections. Unless earlier terminated or extended by mutual agreement of the Company and the lenders, as of June 28, 2015, the U.S. Conduit expires October 30, 2015.

Term Asset-Backed Securitization VIEs – For all of the term asset-backed securitization transactions, the Company transferred U.S. retail motorcycle finance receivables to separate VIEs, which in turn issued secured notes with various maturities and interest rates to investors. All of the notes held by the VIEs are secured by future collections of the purchased U.S. retail motorcycle finance receivables. The U.S. retail motorcycle finance receivables included in the term asset-backed securitization transactions are not available to pay other obligations or claims of the Company's creditors until the associated debt and other obligations are satisfied. Restricted cash balances held by the VIEs are used only to support the securitizations. There is no amortization schedule for the secured notes; however, the debt is reduced monthly as available collections on the related retail motorcycle finance receivables are applied to outstanding principal. The secured notes’ contractual lives have various maturities ranging from 2015 to 2022.

During the first quarter of 2015, the Company issued $700.0 million of secured notes through one term asset-backed securitization transaction. During the second quarter of 2015, the Company issued $500.0 million of secured notes through one term asset-backed securitization transaction. During the second quarter of 2014, the Company issued $850.0 million of secured notes through one term asset-backed securitization transaction. There were no other term asset-backed securitization transactions during the six months ended June 29, 2014.

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Intercompany Borrowing – HDFS and the Company have had in effect term loan agreements under which HDFS borrowed from the Company. During the six months ended June 28, 2015, there were no new intercompany loans made and the intercompany loan balance of $250 million outstanding as of December 31, 2014 was repaid. At June 29, 2014, the outstanding intercompany term loan balance was $550 million. The term loan balances and related interest are eliminated in the Company's consolidated financial statements.

Support Agreement - The Company has a support agreement with HDFS whereby, if required, the Company agrees to provide HDFS with financial support to maintain HDFS’ fixed-charge coverage at 1.25 and minimum net worth of $40.0 million. Support may be provided at the Company’s option as capital contributions or loans. Accordingly, certain debt covenants may restrict the Company’s ability to withdraw funds from HDFS outside the normal course of business. No amount has ever been provided to HDFS under the support agreement.

Operating and Financial Covenants – HDFS and the Company are subject to various operating and financial covenants related to the Global Credit Facilities and various operating covenants under the Notes and the U.S. and Canadian asset-backed commercial paper conduit facilities. The more significant covenants are described below.

The operating covenants limit the Company’s and HDFS’ ability to:

• assume or incur certain liens;

• participate in certain mergers, consolidations, liquidations or dissolutions; and

• purchase or hold margin stock.

Under the current financial covenants of the Global Credit Facilities, the consolidated debt to equity ratio of HDFS cannot exceed 10.0 to 1.0 as of the end of any fiscal quarter. In addition, the ratio of the Company's consolidated debt to the Company's consolidated debt and equity, in each case excluding the debt of HDFS and its subsidiaries, cannot exceed 0.65 to 1.0 as of the end of any fiscal quarter. No financial covenants are required under the Notes or the U.S. or Canadian asset-backed commercial paper conduit facilities.

At June 28, 2015, HDFS and the Company remained in compliance with all of the then existing covenants. There are no new covenants associated with the new senior unsecured debt issued in July 2015.

Cautionary Statements

The Company’s ability to meet the targets and expectations noted depends upon, among other factors, the Company’s ability to:

(i) execute its business strategy,

(ii) manage through changes in general economic conditions, including changing capital, credit and retail markets, and political events,

(iii) accurately estimate and adjust to fluctuations in foreign currency exchange rates, interest rates and commodity prices,

(iv) balance production volumes for its new motorcycles with consumer demand, including in circumstances where competitors may be supplying new motorcycles to the market in excess of demand at reduced prices,

(v) continue to develop the capabilities of its distributors and dealers and manage the risks that our independent dealers may have difficulty obtaining capital and managing through changing economic conditions and consumer demand,

(vi) successfully access the capital and/or credit markets on terms (including interest rates) that are acceptable to the Company and within its expectations,

(vii) effect repurchases of its common stock at share prices that are within its expectations,

(viii) consummate the Canada Distributor Transaction and complete the transition to the new direct distribution model in Canada on the timing for the costs and at the foreign currency exchange rates that are within its expectations,

(ix) prevent a cybersecurity breach involving digital consumer, employee or dealer personal data,

(x) manage the impact that prices for used motorcycles may have on retail sales of new motorcycles,

(xi) manage risks that arise through expanding international manufacturing, operations and sales,

(xii) manage through the effects inconsistent and unpredictable weather patterns may have on retail sales of motorcycles,

(xiii) manage changes and prepare for requirements in legislative and regulatory environments for its products, services and operations,

(xiv) manage supply chain issues, including quality issues and any unexpected interruptions or price increases caused by raw material shortages or natural disasters,

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(xv) prevent and detect any issues with the Company's products, components purchased from suppliers, and its suppliers' manufacturing processes to avoid delays in new model launches, recall campaigns, increased warranty costs or litigation, and adverse affects on the Company's reputation and brand strength,

(xvi) develop and introduce products, services and experiences that are successful in the marketplace,

(xvii) develop and implement sales and marketing plans that retain existing retail customers and attract new retail customers in an increasingly competitive marketplace,

(xviii) implement and manage enterprise-wide information technology solutions, including solutions at its manufacturing facilities,

(xix) continue to realize production efficiencies at its production facilities and manage operating costs including materials, labor and overhead,

(xx) execute its flexible production strategy,

(xxi) continue to manage the relationships and agreements that it has with its labor unions to help drive long-term competitiveness,

(xxii) adjust to healthcare inflation and reform, pension reform and tax changes,

(xxiii) retain and attract talented employees,

(xxiv) continue to have access to reliable sources of capital funding and adjust to fluctuations in the cost of capital, and

(xxv) manage the credit quality, the loan servicing and collection activities, and the recovery rates of HDFS’ loan portfolio

In addition, the Company could experience delays or disruptions in its operations as a result of work stoppages, strikes, natural causes, terrorism or other factors. Further, actual foreign currency exchange rates may vary from underlying assumptions. Other factors are described in risk factors that the Company has disclosed in documents previously filed with the Securities and Exchange Commission.

Many of these risk factors are impacted by the current changing capital, credit and retail markets and the Company's ability to manage through inconsistent economic conditions.

The Company’s ability to sell its motorcycles and related products and services and to meet its financial expectations also depends on the ability of the Company’s independent dealers to sell its motorcycles and related products and services to retail customers. The Company depends on the capability and financial capacity of its independent dealers and distributors to develop and implement effective retail sales plans to create demand for the motorcycles and related products and services they purchase from the Company.

In addition, the Company’s independent dealers and distributors may experience difficulties in operating their businesses and selling Harley-Davidson motorcycles and related products and services as a result of weather, economic conditions or other factors.

In recent years, HDFS has experienced historically low levels of retail credit losses, but there is no assurance that this will continue. The Company believes that HDFS' retail credit losses may increase over time due to changing consumer credit behavior and HDFS' efforts to increase prudently structured loan approvals in the sub-prime lending environment.

Refer to “Risk Factors” under Item 1A of the Company’s Annual Report on Form 10-K for the year ended December 31, 2014 for a discussion of additional risk factors and a more complete discussion of some of the cautionary statements noted above.

Item 3. Quantitative and Qualitative Disclosures about Market Risk

Refer to the Company's Annual Report on Form 10-K for the year ended December 31, 2014 for a complete discussion of the Company's market risk. There have been no material changes to the market risk information included in the Company's Annual Report on Form 10-K for the year ended December 31, 2014.

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Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

In accordance with Rule 13a-15(b) of the Securities Exchange Act of 1934 (the Exchange Act), as of the end of the period covered by this Quarterly Report on Form 10-Q, the Company’s management evaluated, with the participation of the Company’s President and Chief Executive Officer and the Senior Vice President and Chief Financial Officer, the effectiveness of the design and operation of the Company’s disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act). Based upon their evaluation of these disclosure controls and procedures, the President and Chief Executive Officer and the Senior Vice President and Chief Financial Officer have concluded that the disclosure controls and procedures were effective as of the end of the period covered by this Quarterly Report on Form 10-Q to ensure that information required to be disclosed by the Company in the reports it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time period specified in the Securities and Exchange Commission rules and forms, and to ensure that information required to be disclosed by the Company in the reports it files or submits under the Exchange Act is accumulated and communicated to the Company’s management, including its President and Chief Executive Officer and Senior Vice President and Chief Financial Officer, as appropriate, to allow timely decisions regarding disclosure.

Changes in Internal Controls

There was no change in the Company’s internal control over financial reporting during the quarter ended June 28, 2015 that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

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PART II – OTHER INFORMATION

Item 1 – Legal Proceedings

The information required under this Item 1 of Part II is contained in Item 1 of Part I of this Quarterly report on Form 10-Q in Note 16 of the Notes to Condensed Consolidated Financial Statements, and such information is incorporated herein by reference in this Item 1 of Part II.

Item 2 – Unregistered Sales of Equity Securities and Use of Proceeds

The following table contains detail related to the repurchase of common stock based on the date of trade during the quarter ended June 28, 2015:

2015 Fiscal Month	Total Number of Shares Purchased (a)	Average Price Paid per Share	Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	Maximum Number of Shares that May Yet Be Purchased Under the Plans or Programs
March 30 to May 3	1,448,410	60	1,448,410	17,200,902
May 4 to May 31	1,405,461	56	1,405,461	15,929,045
June 1 to June 28	—	—	—	30,952,335
Total	2,853,871	58	2,853,871

(a) Includes discretionary share repurchases and shares of common stock that employees surrendered to satisfy withholding taxes in connection with the vesting of restricted stock awards

The Company has an authorization (originally adopted in December 1997) by its Board of Directors to repurchase shares of its outstanding common stock under which the cumulative number of shares repurchased, at the time of any repurchase, shall not exceed the sum of (1) the number of shares issued in connection with the exercise of stock options occurring on or after January 1, 2004 plus (2) one percent of the issued and outstanding common stock of the Company on January 1 of the current year, adjusted for any stock split. The Company made discretionary share repurchases of 0.1 million shares during the quarter ended June 28, 2015 under this authorization. As of June 28, 2015, 23,290 shares remained under this authorization.

In December 2007, the Company’s Board of Directors separately authorized the Company to buy back up to 20.0 million shares of its common stock with no dollar limit or expiration date. The Company made no discretionary share repurchases during the quarter ended June 28, 2015 under this authorization. As of June 28, 2015, no shares remained under this authorization.

In February 2014, the Company's Board of Directors authorized the Company to repurchase up to 20.0 million shares of its common stock with no dollar limit or expiration date. The Company made discretionary share repurchases of 2.7 million shares during the quarter ended June 28, 2015 under this authorization. As of June 28, 2015, 15.9 million shares remained under this authorization.

Additionally, in June 2015, the Company disclosed that its Board of Directors authorized the Company to repurchase up to 15.0 million shares of its common stock with no dollar limit or expiration date. The Company made no discretionary share repurchases during the quarter ended June 28, 2015 under this authorization. As of June 28, 2015, 15.0 million shares remained under this authorization.

Under the share repurchase authorizations, the Company’s common stock may be purchased through any one or more of a Rule 10b5-1 trading plan and discretionary purchases on the open market, block trades, accelerated share repurchases or privately negotiated transactions. The number of shares repurchased, if any, and the timing of repurchases will depend on a number of factors, including share price, trading volume and general market conditions, as well as on working capital requirements, general business conditions and other factors. The repurchase authority has no expiration date but may be suspended, modified or discontinued at any time.

The Harley-Davidson, Inc. 2014 Incentive Stock Plan and predecessor stock plans permit participants to satisfy all or a portion of the statutory federal, state and local withholding tax obligations arising in connection with plan awards by electing to (a) have the Company withhold shares otherwise issuable under the award, (b) tender back shares received in connection with such award or (c) deliver other previously owned shares, in each case having a value equal to the amount to be withheld. During the second quarter of 2015, the Company acquired 16,660 shares of common stock that employees presented to the Company to satisfy withholding taxes in connection with the vesting of restricted stock awards.

59

Item 6 – Exhibits

Refer to the Exhibit Index on page 62 of this report.

60

SIGNATURES

Pursuant to the requirements of the Securities and Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	HARLEY-DAVIDSON, INC.
Date: 8/6/2015	/s/ John A. Olin
	John A. Olin
	Senior Vice President and
	Chief Financial Officer
	(Principal financial officer)

Date: 8/6/2015	/s/ Mark R. Kornetzke
	Mark R. Kornetzke
	Chief Accounting Officer
	(Principal accounting officer)

61

Harley-Davidson, Inc.

Exhibit Index to Form 10-Q

Exhibit No.	Description
2.1	Asset Purchase Agreement, dated April 30, 2015, among Harley-Davidson Canada LP, Fred Deeley Imports Ltd. and Harley-Davidson Motor Company, Inc., as amended.
10.1*	Form of Non-competition and Non-solicitation Agreement between Harley-Davidson Canada LP and each of Donald A. James and Fred Deeley Imports Ltd., effective August 4, 2015
31.1	Chief Executive Officer Certification pursuant to Rule 13a-14(a)
31.2	Chief Financial Officer Certification pursuant to Rule 13a-14(a)
32.1	Written Statement of the Chief Executive Officer and the Chief Financial Officer pursuant to 18 U.S.C. §1350
101	Financial statements from the quarterly report on Form 10-Q of Harley-Davidson, Inc. for the quarter ended June 28, 2015, filed on August 6, 2015, formatted in XBRL: (i) the Condensed Consolidated Statements of Income; (ii) the Condensed Consolidated Statements of Comprehensive Income; (iii) the Condensed Consolidated Balance Sheets; (iv) the Condensed Consolidated Statements of Cash Flows; and (v) the Notes to Condensed Consolidated Financial Statements.

* Represents a management contract or compensatory plan, contract or arrangement in which a director or named executive officer of the Company participated.

62

EX-2.1

EXECUTION COPY

ASSET PURCHASE AGREEMENT

AMONG

HARLEY-DAVIDSON CANADA LP

AND

FRED DEELEY IMPORTS LTD.

AND

HARLEY-DAVIDSON MOTOR COMPANY, INC.

April 30, 2015

TABLE OF CONTENTS

ARTICLE 1 - INTERPRETATION2

1.1Definitions    2

1.2Currency    12

1.3Sections and Headings    12

1.4Number, Gender and Persons    12

1.5Accounting Principles    13

1.6Entire Agreement    13

1.7Time of Essence    13

1.8Applicable Law    13

1.9Arbitration    13

1.10Severability    14

1.11Successors and Assigns    14

1.12Amendment and Waivers    15

1.13Exhibits    15

1.14Schedules    15

ARTICLE 2 - PURCHASE AND SALE OF PURCHASED ASSETS16

2.1Transfer of Purchased Assets    16

2.2Excluded Assets    19

2.3Delivery Up of Possession of Purchased Assets to the Purchaser    20

2.4Delivery Up of Possession of Excluded Assets to the Vendor    20

ARTICLE 3 - PURCHASE PRICE21

3.1Purchase Price    21

3.2Satisfaction of the Purchase Price and Other Closing Payments    21

3.3Assumption of Certain Liabilities by the Purchaser    22

3.4Excluded Liabilities    22

3.5Estimated Closing Date Financial Statement    23

3.6Working Capital and Liabilities Adjustment    23

3.7Allocation of the Purchase Price    24

3.8ETA Election    24

3.9ITA Elections    25

3.10Transfer Taxes    25

ARTICLE 4 - REPRESENTATIONS AND WARRANTIES
OF THE VENDOR    25

4.1Organization    26

4.2Authorization and Enforceability    26

4.3Tax Matters    26

4.4Residency of Vendor    26

4.5No Violation    27

4.6Consents and Approvals    27

4.7Accounts Receivable    27

4.8Inventories    27

i

4.9Title to Personal and other Property    28

4.10No other Agreement to Purchase    28

4.11Location of Real Property    28

4.12Concord Property and Richmond Property    28

4.13AReal Property    28

4.13Location of the Purchased Assets    29

4.14Compliance with Laws; Permits    29

4.15Litigation    29

4.16Vendor Contracts, Dealer Agreements and Assumed Contracts    29

4.17Computer Systems    29

4.18Warranties and Discounts    30

4.19Insurance    30

4.20Environmental    31

4.21Intellectual Property    31

4.22Labour Relations and Collective Agreements    31

4.23Employees    32

4.24Employee Plans    33

4.25Books and Records    33

4.26No Undisclosed Liabilities    33

4.27Financial Statements and Financial Books and Records    33

4.28Conduct of Business in Ordinary Course    34

4.29Conduct of Business in Accordance with Business Plan    35

4.30No Bankruptcy or Insolvency    35

4.31Compliance With Privacy Laws    35

4.32GST/HST Registration    35

4.33Equity interests    35

4.34Brokerage Fees    35

ARTICLE 5 - REPRESENTATIONS AND WARRANTIES
OF THE PURCHASER    36

5.1Organization    36

5.2Authorization    36

5.3No Violation    36

5.4Consents and Approvals    37

5.5GST/HST Registration    37

5.6Brokerage Fees    37

5.7No Bankruptcy or Insolvency    37

ARTICLE 6 - SURVIVAL OF COVENANTS,
REPRESENTATIONS AND WARRANTIES    37

6.1Survival of Representations and Warranties of the Vendor    37

6.2Survival of the Representations and Warranties of the Purchaser and HDMC    38

6.3Survival of Covenants    38

ARTICLE 7 - INTERIM PERIOD38

7.1Conduct of Business Prior to Closing    38

7.2Conduct of Business in Accordance with Marketing Plan    40

7.3Material Performance of Distributorship Agreement    41

ii

7.4Motorcycle Target    41

7.5Non-Current Inventory Target    41

7.6PAM Target    41

7.7Maintenance of Current Pricing    41

7.8Access for Investigation    41

7.9Performance under the Distributorship Agreement prior to Closing    42

7.10Obtaining All Authorizations    42

7.11Wind-up of HOG    43

ARTICLE 8 - OTHER COVENANTS43

8.1Regulatory Approvals    43

8.2Consents and Approvals    43

8.3Bulk Sales Waiver    44

8.4Escrow Agreement    44

8.5Concord Lease    44

8.6Richmond Occupancy License    44

8.7Non-Competition Agreements    44

8.8Transitional Services Agreement    45

8.9HDFS Discharge    45

8.10Dealer Network Relationships    45

8.11Delivery of Books and Records    45

8.12Litigation Support    46

8.13Employee Matters    46

8.14Non-Transferable and Non-Assignable Assets    49

8.15Personal Information    50

8.16Use of “Deeley” Name    51

8.17Customer Personal Information and CASL    51

8.18Gift Card Program    51

ARTICLE 9 - CONDITIONS OF CLOSING52

9.1Conditions of Closing in Favour of the Purchaser    52

9.2Conditions of Closing in Favour of the Vendor    57

9.3Survival of Disclosure Provisions    59

ARTICLE 10 - CLOSING DATE AND TRANSFER OF POSSESSION59

10.1Place of Closing    59

10.2Further Assurances    59

ARTICLE 11 - REMEDIES60

11.1Indemnification by the Vendor    60

11.2Indemnification by the Purchaser    60

11.3Notice of Claim    61

11.4Direct Claims    61

11.5Third Party Claims    62

11.6Settlement of Third Party Claims    63

11.7Co-operation    63

11.8Trustee and Agent    63

11.9Exclusivity    63

iii

11.10Insurance Proceeds and Taxes    64

11.11Right to Claim Escrow Amount    64

11.12Set off    64

11.13Limitations on Claims    64

11.14Other Limitations    65

11.15GST/HST Gross Up    65

ARTICLE 12 - MISCELLANEOUS65

12.1Notices    65

12.2Announcements    66

12.3Disclosure    67

12.4Reasonable Commercial Efforts    67

12.5Expenses    67

12.6Counterparts    67

iv

ASSET PURCHASE AGREEMENT

THIS ASSET PURCHASE AGREEMENT made as of the 30^th day of April, 2015,

AMONG:

HARLEY-DAVIDSON CANADA LP, a limited partnership existing under the laws of the Province of Ontario,

(hereinafter referred to as the “Purchaser”),

OF THE FIRST PART,

- and -

FRED DEELEY IMPORTS LTD., a corporation existing under the laws of the Province of British Columbia,

(hereinafter referred to as the “Vendor”),

OF THE SECOND PART,

- and -

HARLEY-DAVIDSON MOTOR COMPANY, INC., a corporation existing under the laws of the State of Wisconsin,

(hereinafter referred to as “HDMC”),

OF THE THIRD PART.

WHEREAS the Vendor has carried on the business of being the exclusive distributor in Canada of Harley-Davidson motorcycles, parts and accessories, apparel and other merchandise prior to and under a distributorship agreement dated February 20, 2008 between HDMC and the Vendor (the “Distributorship Agreement”);

AND WHEREAS the Vendor is party to a financing agreement with Harley-Davidson Financial Services Canada (“HDFS Canada”) dated June 25, 2014 (the “Financing Agreement”);

AND WHEREAS HDMC has provided the Vendor with notice of termination of the Distributorship Agreement in accordance with its terms, which termination shall be effective as of July 31, 2017;

AND WHEREAS the Purchaser is willing to purchase the Purchased Assets (as hereinafter defined), and to arrange the early termination of the Distributorship Agreement, and the Vendor is willing to sell the Purchased Assets to the Purchaser and agree to the early termination of the

- Page 2 -

Distributorship Agreement, in accordance with and subject to the terms and conditions of this Agreement;

AND WHEREAS HDMC consents to the foregoing transaction of purchase and sale;

NOW, THEREFORE, THIS AGREEMENT WITNESSES THAT in consideration of the respective covenants, agreements, representations, warranties and indemnities of the parties herein contained and for other good and valuable consideration (the receipt and sufficiency of which are acknowledged by each party), the parties agree as follows:

ARTICLE 1 - INTERPRETATION

1.1 Definitions

For the purposes of this Agreement, unless the context otherwise requires, the following terms shall have the respective meanings set out below and grammatical variations of such terms shall have corresponding meanings:

(a) “Abatement” has the meaning set out in Section 9.1(b)(ii);

(b) “Accounting Records” means all of the Vendor’s books of account (including the general ledger), records relating to Accounts Receivable, Inventory, Accounts Payable and Prepaid Expenses, accounting records and other financial data and information relating to the Business or the Purchased Assets, including Tax Returns;

(c) “Accounts Payable” has the meaning set out in Section 3.3(c);

(d) “Accounts Receivable” means any and all accounts, accounts receivable, trade accounts, notes, notes receivable, book debts or other debts due or accruing to the Vendor from:

(i) the Dealers in connection with the Business, including pursuant to the Dealer Agreements, and any programs implemented with Dealers in connection with the Business;

(ii) HDFS Canada; and

(iii) the receivables set out on Schedule 1.1(d),

but excluding:

(iv) the GE Receivables;

(v) non-HDFS Canada receivables that are aged in excess of ninety (90) days as of the Closing Date,

all as reflected on the Estimated Closing Balance Sheet, including the benefit of any security thereon, and any claim, right or remedy relating thereto;

- Page 3 -

(e) “Affiliate” has the meaning attributed to that term in the Canada Business Corporations Act, as amended from time to time;

(f) “Advance Ruling Certificate” means an advance ruling certificate issued by the Commissioner of Competition pursuant to section 102 of the Competition Act;

(g) “Applicable Law” means any law, statute, ordinance, regulation, rule, by-law, decree, writ or order, protocol, code, guideline, treaty, policy, notice, direction and judicial, arbitral, administrative, ministerial or departmental judgements, awards or requirements of any Authority having jurisdiction over the Vendor or over any part of the Business or the Purchased Assets and includes Environmental Laws;

(h) “Arbitrating Accountant” has the meaning set out in Section 3.6(c);

(i) “Assumed Contracts” has the meaning set out in Section 2.1(a);

(j) “Assumed Liabilities” means the liabilities and obligations of the Vendor assumed by the Purchaser pursuant to Section 3.3;

(k) “Authority” means any governmental or regulatory authority, department, body or agency or any court, tribunal, bureau, commission, arbitrator or arbitration board or other similar body, whether federal, provincial, state, municipal or other geographic or political subdivision thereof;

(l) “Balance Sheets”means, collectively, the audited balance sheet of the Vendor as at December 31, 2013, (the “Audited Balance Sheet”) and the unaudited, internally prepared balance sheets of the Vendor as at December 31, 2014 and March 31, 2015 (the “Unaudited Balance Sheets”), such balance sheets forming a part of the Financial Statements attached hereto as Schedule 1.1(ccc);

(m) “Books and Records” means all books, records, files and papers, manuals and data, sales and advertising materials, lists of present and former suppliers, price lists, sales records, personnel, employment and other records (relating only to Hired Employees), customer data, documentary evidence of all licenses, orders and permits, and all other correspondence, data and information, financial or otherwise, in any format or media whatsoever, of the Vendor relating to the Business, including copies of all Accounting Records and books and records required by Applicable Law to be retained by the Vendor (the originals of which shall be retained by the Vendor), but excluding Tax Returns of the Vendor and books and records relating to the Excluded Assets;

(n) “Break-up Fee” has the meaning set out in Section 9.2(c);

(o) “Business” means the business carried on by the Vendor as of the date hereof of the exclusive importation and wholesale distribution to Dealers in Canada of Harley-Davidson motorcycles, parts and accessories, apparel and other merchandise in accordance with and pursuant to the Distributorship Agreement, but excludes the Dealership Business;

- Page 4 -

(p) “Business Day” means any day, other than a Saturday or a Sunday, on which chartered banks in Toronto, Ontario are open for business;

(q) “Cash” means, as of the Closing Date, the amount of cash and bank deposits as reflected in the Vendor’s bank statements and certificates of deposit, including cheques and drafts deposited for the account of the Vendor;

(r) “CASL” means an Act to promote the efficiency and adaptability of the Canadian economy by regulating certain activities that discourage reliance on electronic means of carrying out commercial activities, and to amend the Canadian Radio-television and Telecommunications Commission Act, the Competition Act, the Personal Information Protection and Electronic Documents Act and the Telecommunications Act and the regulations thereunder;

(s) “CEM” means a commercial electronic message as such term is defined in CASL;

(t) “Claim” has the meaning set out in Section 11.3;

(u) “Closing” has the meaning set out in Section 10.1;

(v) “Closing Balance Sheet” means the unaudited, internally prepared balance sheet of the Vendor as at the Closing Date, in respect of the Purchased Assets and Assumed Liabilities (and, for greater certainty, excluding the effect of any Excluded Assets and Excluded Liabilities), prepared pursuant to Section 3.6 and, to the extent applicable, on the same basis and applying the same accounting principles, policies and practices that were used in preparing the Unaudited Balance Sheets;

(w) “Closing Date”means August 4, 2015 or such other date as the Vendor and the Purchaser may mutually determine;

(x) “Closing Date Financial Statement” has the meaning set out in Section 3.6(a);

(y) “Commissioner” means the Commissioner of Competition appointed under subsection 7(1) of the Competition Act or his designee;

(z) “Competition Act” means the Competition Act, R.S.C. 1985, c. C-34, as amended, including the regulations promulgated thereunder;

(aa) “Competition Act Approval” means:

(i) the issuance of an Advance Ruling Certificate with respect to the transactions contemplated by this Agreement;

(ii) the Purchaser and the Vendor have given the notice required under section 114 of the Competition Act with respect to the transactions contemplated by this Agreement and the applicable waiting period under section 123 of the Competition Act has expired or been waived in accordance with the Competition Act; or

- Page 5 -

(iii) the obligation to give the requisite notice has been waived pursuant to subsection 113(c) of the Competition Act,

and, in the case of (ii) or (iii), the Purchaser has been advised in writing by the Commissioner or a person authorized by the Commissioner that the Commissioner does not intend, at this time, to apply to the Competition Tribunal for an order under Part VIII of the Competition Act with respect to the transactions contemplated by this Agreement, and such advice has not been rescinded or amended;

(bb) “Concord Lease”means the lease in respect of the Concord Property to be entered into by Fred Deeley Investments Ltd., as landlord, and the Purchaser, as tenant, in the form attached as Exhibit A, and includes the lease of the Purchaser Leased Equipment;

(cc) “Concord Property” means the property municipally known as 830 Edgeley Boulevard in Concord, Ontario;

(dd) “Contract” means any agreement, indenture, contract, deed of trust, licence, option, right, promise, assurance, undertaking, whether written or oral, express or implied and whether or not legally binding;

(ee) “Dealers” means the retailers to consumers in the Vendor’s dealer network that are parties to the Dealer Agreements, and “Dealer” means any one of them;

(ff) “Dealer Agreements” means the dealer agreements between the Vendor and the Dealers entered into by the Vendor pursuant to its rights under the Distributorship Agreement and the related trade-mark agreements entered into between the Vendor and the Dealers together with any bundled services agreements entered into between the Vendor and the Dealers and any Buell transition agreements, all as listed in Schedule 1.1(ff), complete copies of which have been provided to the Purchaser as of the date hereof;

(gg) “Dealership Business” means the business of carrying on the retail sale, lease, rental and servicing by Trev Deeley Motorcycles (1991) Ltd.of Harley-Davidson branded motorcycles, parts, lease, and accessories, apparel and merchandise, currently operated from its physical showroom facility located at 1875 Boundary Road, Vancouver, British Columbia V5M 3Y7, and shall expressly include the operation of the Deeley Motorcycle Exhibition (the “Museum”);

(hh) “Deeley-HDMC Agreement” means the Deeley-HDMC Agreement to be entered into between HDMC and the Vendor, in respect of the Distributorship Agreement and certain other Harley-Davidson Terminated Agreements between HDMC and the Vendor, in the form attached as Exhibit B;

(ii) “Determination Date” has the meaning set out in Section 3.6(c);

(jj) “Direct Claim” has the meaning set out in Section 11.3;

- Page 6 -

(kk) “Dispute Notice” has the meaning set out in Section 3.6(c);

(ll) “Dispute Period” has the meaning set out in Section 3.6(c);

(mm) “Distributorship Agreement” has the meaning set out in the Recitals;

(nn) “Employee Plans” has the meaning set out in Section 4.24;

(oo) “Employees” has the meaning set out in Section 4.23(a);

(pp) “Employment Legislation” means, collectively, the Ontario Human Rights Code, the Occupational Health and Safety Act (Ontario), the Pay Equity Act (Ontario), the Employment Standards Act, 2000 (Ontario) or predecessor to that Act, the Workplace Safety and Insurance Act, 1997 (Ontario) or predecessor to that Act, the Employment Standards Act (British Columbia) or predecessor to that Act, and the Employment Insurance Act (Canada), all as amended from time to time, and the comparable legislation of any other applicable jurisdiction;

(qq) “Encumbrance” means any financial encumbrance, lien, charge, hypothec, pledge, mortgage, title retention agreement, security interest, reservation of title, easement, right of occupation, any matter capable of registration against title, or any written agreement to create any of the foregoing, but excluding any Taxes not yet due and payable;

(rr) “Environmental Condition” means the presence of any Hazardous Substance in, on, under, migrating onto or from the Concord Property;

(ss) “Environmental Laws” means any federal, provincial or municipal law, statute, by-law, order, ordinance, code, regulation, rule, order or permit and all Environmental Permits in effect as of the Closing Date that relate to pollution or protection of the environment, human health and safety, waste disposal, emissions, discharges, Releases or threatened Releases of a Hazardous Substance or other environmental matters, and to the manufacture, processing, distribution, use, treatment, storage, disposal, transport, handling and the like of Hazardous Substances;

(tt) “Environmental Permits” means all licences, permits, approvals, consents, registrations, certificates, authorizations, exemptions, waivers, variations, clearances, orders, or other similar approvals issued or granted or required by an Authority pursuant to an Environmental Law;

(uu) “Equipment Leases” means all equipment leases, conditional sales contracts, capital leases, title retention agreements and other similar agreements between the Vendor and third Persons relating to equipment used by the Vendor and related to the Business;

(vv) “Escrow Agent”means an independent entity carrying on business as an escrow agent in the Province of Ontario acceptable to the parties hereto acting reasonably;

- Page 7 -

(ww) “Escrow Agreement”means the agreement to be entered into between the Vendor, the Purchaser, and the Escrow Agent, in the form attached hereto as Exhibit C, as contemplated in Section 8.4;

(xx) “Escrow Amount” has the meaning set out in Section 3.2(a);

(yy) “Estimated Closing Balance Sheet” means the unaudited, internally prepared estimated balance sheet of the Vendor as at the Closing Date, in respect of the Purchased Assets and Assumed Liabilities (and, for greater certainty, excluding the effect of any Excluded Assets and Excluded Liabilities), prepared pursuant to Section 3.6 on the same basis and applying the same accounting principles, policies and practices to the extent applicable that were used in preparing the Unaudited Balance Sheets;

(zz) “ETA” means Part IX of the Excise Tax Act (Canada), as amended from time to time;

(aaa) “Excluded Assets”has the meaning set out in Section 2.2;

(bbb) “Excluded Liabilities” has the meaning set out in Section 3.4;

(ccc) “Financial Statements” means, collectively, the audited financial statements of the Vendor for the financial year ended December 31, 2013, consisting of a balance sheet, statement of earnings and retained earnings and cash flow and all notes thereto, and the unaudited, internally prepared financial statements of the Vendor for the financial year ended December 31, 2014, and unaudited, internally prepared balance sheet of the Vendor as at March 31, 2015 and unaudited, internally prepared interim statement of earnings and retained earnings of the Vendor for the quarterly period ended March 31, 2015, copies of which are attached as Schedule 1.1(ccc);

(ddd) “Financing Agreement” has the meaning set out in the Recitals;

(eee) “Full Term” has the meaning set out in Section 8.10;

(fff) “Fundamental Representations” has the meaning set out in Section 6.1(a);

(ggg) “GE Receivables” means any and all accounts, accounts receivable, trade accounts, notes, notes receivable, book debts or other debts due or accruing to the Vendor from GE Capital Canada or from the Dealers to the Vendor to the extent that such amounts are subject to financing arrangements by GE Capital Canada in favour of the Vendor;

(hhh) “GST/HST” means all goods and services taxes and harmonized sales taxes payable under the ETA;

(iii) “Gift Card Program” means a program that the Vendor manages, through a third party, on behalf of Dealers, whereby gift cards are (i) purchased by retail customers at dealership locations with the purchase proceeds thereof credited to the Vendor, and (ii) used by retail customers for credit against the purchase of merchandise or services sold by Dealers;

- Page 8 -

(jjj) “Hazardous Substances” means any hazardous, dangerous or toxic substance, material or waste that is prohibited, controlled or regulated under any Environmental Law including pollutants, contaminants, dangerous goods or substances, toxic or hazardous substances or materials, wastes, petroleum hydrocarbons, volatile organic compounds, polyaromatic hydrocarbons, PCBs, UFFI, lead-based materials, asbestos containing materials, and specifically includes underground storage tanks;

(kkk) “HDFS Canada” means Harley-Davidson Financial Services Canada Inc.;

(lll) “Hired Employees”has the meaning ascribed to it in Section 8.13(c);

(mmm) “HOG” means Harley Owners Group Canada Inc., a wholly-owned subsidiary of the Vendor;

(nnn) “ICA Approval” means approval or deemed approval of the transactions contemplated by this Agreement by the applicable Minister(s) pursuant to the Investment Canada Act;

(ooo) “including” (and having correlative meaning “include” and “includes”) means including without limiting the generality of any description preceding such term;

(ppp) “Indemnified Party” has the meaning set out in Section 11.3;

(qqq) “Indemnifying Party”has the meaning set out in Section 11.3;

(rrr) “Intellectual Property” means all rights in patents, patent applications, trade-marks, trade-mark applications, trade-names, business names, domain names, inventions, technical data, licensed and unlicensed know-how, copyright and industrial designs;

(sss) “Intellectual Property Assets” has the meaning set out in Section 2.1(g);

(ttt) “Interim Period” means the period of time between the close of business on the date of execution hereof and the Time of Closing;

(uuu) “Inventories” means, collectively, the PAM Inventory and the Motorcycle Inventory;

(vvv) “Investment Canada Act” means the Investment Canada Act, as amended;

(www) “ITA”means the Income Tax Act (Canada), as amended from time to time;

(xxx) “knowledge of the Vendor” or similar expressions mean the actual knowledge of any of Don James, Malcolm Hunter and Buzz Green after reasonable inquiry;

(yyy) “Leased Richmond Property” means the leasehold interest of the Vendor in the Richmond Property;

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(zzz) “License Agreement” means the license agreement to be entered into between the Vendor and the Purchaser, in the form attached as Exhibit D, as contemplated in Section 8.16;

(aaaa) “Losses”, in respect of any matter, means all claims, demands, losses, damages, liabilities, Taxes, deficiencies, costs and expenses (including reasonable legal and other professional fees and disbursements, interest, penalties and amounts paid in settlement) arising as a result of such matter, but excluding any indirect, special, punitive, exemplary or consequential losses or damages and losses of revenue or profit, and excluding legal costs for counsel provided to the Vendor or the Purchaser prior to the Closing Date;

(bbbb) “Material Adverse Change” means, when used in connection with the Business, any change, event, violation, inaccuracy, circumstance or event that, when considered individually or in the aggregate together with all other adverse effects, is, or could reasonably be expected to be, materially adverse to the business, assets, liabilities, financial condition, or results of operation of the Business, but in each case shall not include the effect of (i) changes in legislation or GAAP or official interpretations of the foregoing, (ii) changes arising from or relating to this Agreement or the transactions contemplated hereby, (iii) arising from any actions or omissions of the Purchaser or the Vendor if consented to in writing by the Purchaser, or (iv) changes in general economic conditions and changes in industry-wide conditions affecting the industry in which the Business operates;

(cccc) “Motorcycle Inventory” has the meaning ascribed to it in Section 2.1(f);

(dddd) “Museum” has the meaning ascribed to it in Section 1.1(gg);

(eeee) “New Dealer Agreements” has the meaning set out in Section 8.10;

(ffff) “New HDFS Documents” means those HDFS Canada agreements to be presented to the Dealers pursuant to Section 8.10, as set forth more particularly in Schedule 1.1(ffff);

(gggg) “Non-Competition Agreements” means the non-competition agreements to be entered into by the Vendor, Malcolm Hunter and Don James with the Purchaser and HDMC, in the form attached hereto as Exhibit E, as contemplated in Section 8.7, and “Non-Competition Agreement” means any one of them;

(hhhh) “Non-Current Model Target” has the meaning set out in Section 7.5;

(iiii) “Offer” has the meaning set out in Section 8.13(c);

(jjjj) “Offered Employees” has the meaning set out in Section 8.13(c);

(kkkk) “PAM Inventory” has the meaning ascribed to it in Section 2.1(e);

(llll) “Permits” has the meaning set out in Section 2.1(c);

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(mmmm) “Person”means any individual, estate, trust, firm, partnership, joint venture, corporation, unlimited liability company, limited liability company, unincorporated association or organization, government or any agency or ministry of any government, and includes any successor to any of the foregoing;

(nnnn) “Personal Information” means the information regulated by Privacy Laws and collected, used, disclosed or retained by the Vendor in connection with the Business prior to Closing;

(oooo) “Prepaid Expenses” has the meaning set out in Section 2.1(l);

(pppp) “Privacy Laws” means all applicable laws and regulations governing the collection, use, disclosure and retention of information relating to an identifiable individual, including the Personal Information Protection Electronic Documents Act (Canada);

(qqqq) “Purchase Price” has the meaning set out in Section 3.1;

(rrrr) “Purchase Price Adjustment” means the amount, if any, payable by either the Purchaser or the Vendor to the other pursuant to Sections 3.6(d) or 3.6(e), as applicable;

(ssss) “Purchased Assets” has the meaning set out in Section 2.1;

(tttt) “Purchaser Employee Plans” has the meaning set out in Section 8.13(j);

(uuuu) “Purchaser Leased Equipment” means that portion of the Vendor Equipment that forms a part of the subject matter of the Concord Lease, as set out in Schedule 1.1(uuuu);

(vvvv) “Release” means release, spill, leak, pump, discharge, inject, escape, dispose, discharge, spray, inoculate, abandon, deposit, seep, pour, emit, and dump, and when used as a noun has a similar meaning;

(wwww) “Richmond Lease” means the current lease agreement relating to the leasing by the Vendor of the Leased Richmond Property;

(xxxx) “Richmond Occupancy License” means the license in respect of the Richmond Property to be entered into by the Vendor and the Purchaser, in the form attached as Exhibit E1;

(yyyy) “Richmond Property” means the property municipally known as 13500 Verdun Place in Richmond, British Columbia;

(zzzz) “Rights” has the meaning set out in Section 8.13(a);

(aaaaa) “Severance Costs”means the costs incurred by the employer in providing an employee with all of his or her legal entitlements upon termination of employment without cause including any outstanding statutory notice or pay in lieu of such notice

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and severance pay under applicable employment standards legislation; any valid contractual notice or severance obligation (to the extent that such contractual notice/severance obligation exceeds statutory requirements); in the absence of any valid contractual notice or severance obligation, reasonable notice or pay in lieu of such notice under the common law; benefit continuation (including any applicable car allowance and retirement savings plan) or compensation in lieu of benefit continuation through the applicable statutory, contractual or common law notice period in excess of the pro rata amount payable by the Vendor for the period prior to Closing; any bonus payable during the applicable notice period following Closing; and any other costs incurred in good faith, acting reasonably (including reasonable legal fees incurred after the Closing Date), to secure a settlement of any and all claims that an employee might have arising out of the termination of his or her employment without cause;

(vvvv2) “Systems” has the meaning set out in Section 4.17;

(bbbbb) “Tax” or “Taxes” means any and all taxes, charges, fees, levies, imposts, and other assessments, including all income, sales, retail, use, goods and services, harmonized sales, value added, corporation, premium, environmental, stamp, business, social services, royalty, occupancy, property development, capital, capital gains, alternative, net worth, transfer, land transfer, profits, withholding, payroll, employer health, social security, excise, franchise, recapture, real property and personal property taxes, and any other taxes, customs duties, tariffs, fees, assessments, reassessments or similar charges in the nature of a tax, including provincial pension plan contributions, employment insurance contributions and workers’ compensation premiums, together with any instalments with respect thereto, and any interest, surtaxes, fines, penalties or additions to tax, imposed, levied, assessed, reassessed or collected by any Tax Authority;

(ccccc) “Tax Authority” means, with respect to any Tax, the Authority that imposes, assesses and reassesses such Tax and the Authority charged with the collection of such Tax;

(ddddd) “Tax Return” means any return, declaration, report, election, form, notice, filing, information return, or other document (whether in tangible, electronic or other form) relating to Taxes, including any amendment thereof and including any attachment or supplements thereto, filed or required to be filed with a Tax Authority, pursuant to Applicable Law in respect of Taxes;

(eeeee) “Terminated Harley-Davidson Agreements” means, collectively, the subsisting agreements as of the date hereof between HDMC or any of its affiliates and the Vendor including the Distributorship Agreement and the Financing Agreement, as listed in Schedule 1.1(eeeee);

(fffff) “Time of Closing”means 10:00 a.m. (Toronto time) on the Closing Date, or such other time on the Closing Date as the Vendor and the Purchaser may mutually determine;

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(ggggg) “Third Party Claim” has the meaning set out in Section 11.3;

(hhhhh) “Transitional Services Agreement” means the transitional services agreement to be entered into between the Purchaser and the Vendor with respect to the provision by the Vendor of services from its data centres at the Concord Property and the Richmond Property, prepared in accordance with the term sheet attached hereto as Exhibit F, as contemplated in Section 8.8;

(iiiii) “Vendor Contracts” means any and all;

(i) written Contracts in connection with the Business under which:

(A) the Vendor has or may acquire any rights or benefits,

(B) the Vendor has or may become subject to any obligation or liability, or

(C) the Vendor or any of the Purchased Assets is or may become bound, and

(ii) unwritten purchase arrangements relating to the Business where payment to a supplier in 2014 was in excess of Cdn.$25,000,

of which written instruments, contracts and agreements and unwritten purchase arrangements are listed in the attached Schedule 1.1(iiiii);

(jjjjj) “Vendor Equipment” means the equipment owned or leased by the Vendor that is used or held for use in the conduct of the Business and has an original cost value in excess of Cdn.$5,000 as set out in Schedule 1.1(jjjjj);

(kkkkk) “Vendor Intellectual Property” means any and all Intellectual Property owned or licensed by the Vendor and used in the Business; and

(lllll) “Vendor Proceeding” has the meaning set out in Section 8.12.

1.2 Currency

Unless otherwise indicated, all dollar amounts in this Agreement are expressed in United States funds.

1.3 Sections and Headings

The division of this Agreement into sections and the insertion of headings are for convenience of reference only and shall not affect the interpretation of this Agreement. Unless otherwise indicated, any reference in this Agreement to a Section or Schedule refers to the specified Section of or Schedule to this Agreement and any reference in this Agreement to a Section shall include a subsection of such Section, as applicable.

1.4 Number, Gender and Persons

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In this Agreement, words importing the singular number only shall include the plural and vice versa, words importing gender shall include all genders and words importing persons shall include individuals, corporations, partnerships, associations, trusts, unincorporated organizations, governmental bodies and other legal or business entities of any kind whatsoever.

1.5 Accounting Principles

Any reference in this Agreement to generally accepted accounting principles or GAAP refers to Canadian accounting standards for private enterprises at the relevant time applied on a consistent basis.

1.6 Entire Agreement

This Agreement constitutes the entire agreement between the parties with respect to the subject matter hereof and supersedes all prior agreements, understandings, negotiations and discussions, whether written or oral. There are no conditions, covenants, agreements, representations, warranties or other provisions, express or implied, collateral, statutory or otherwise, relating to the subject matter hereof except as herein provided.

1.7 Time of Essence

Time shall be of the essence in this Agreement.

1.8 Applicable Law

This Agreement shall be construed, interpreted and enforced in accordance with, and the respective rights and obligations of the parties shall be governed by, the laws of the Province of Ontario and the federal laws of Canada applicable therein.

1.9 Arbitration

Any dispute, disagreement or controversy arising out of or relating to this Agreement shall be determined by arbitration in accordance with the following rules (and the parties hereby submit to arbitration for such purposes):

(a) The arbitration will proceed in accordance with the provisions of the International Commercial Arbitration Act (Ontario) or any successor legislation. The arbitrator shall determine all matters of procedure, including the timetable for steps to be taken in the arbitration and the extent of oral and documentary discovery, if any.

(b) The arbitration shall be conducted by a single arbitrator. The party commencing the arbitration shall provide a written notice to the other party, which shall include: (i) a description of its claim and the factual and legal basis therefor and (ii) the names of three individuals who are acceptable to it to serve as a sole arbitrator (“Arbitrator Candidates”). Within ten (10) days of the receipt of the notice, the party against whom the arbitration is commenced shall give written notice that it accepts the appointment of one of the three Arbitrator Candidates or shall provide the other party with a list of three additional Arbitrator Candidates. If the parties are unable to agree

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upon a sole arbitrator within a further ten (10) days, each party to the arbitration shall select one Arbitrator Candidate from its own list to act as an arbitration selector and notify the other party of its selection. The arbitration selectors shall, within ten (10) further days, confer and select, in their sole discretion, an Arbitrator Candidate from the remaining Arbitrator Candidates on the parties’ lists to act as the sole arbitrator. In all instances, Arbitrator Candidates shall be (i) either a retired judge or a lawyer qualified to practice law in Ontario with fifteen (15) or more years’ experience in the jurisdiction and (ii) free from conflicts of interest. In the event that the arbitration selectors are unable to agree on a sole arbitrator, the sole arbitrator shall be determined by application to the Ontario Superior Court of Justice. The parties hereby irrevocably attorn to the jurisdiction of the Ontario Superior Court for the purposes of any such application and for the determination of any disputes or matters arising from or related to these arbitration terms that fall outside of the jurisdiction of the sole arbitrator.

(c) The arbitration will be held in the City of Toronto in the Province of Ontario in the English language.

(d) For greater certainty, the parties expressly state that the arbitrator shall have the power to determine all questions of law, fact, fact and law and procedure and shall make all original determinations as to the arbitrators’ own jurisdiction. Any award or determination of the sole arbitrator, including determinations of law, shall be final and binding on the parties and there shall be no appeal on any ground.

The arbitration proceedings and the decision of the arbitrator shall be confidential and shall not be disclosed or published in any manner by either party.

The arbitrator may award costs of the arbitration process, including the reasonable fees and disbursements, to be paid to the successful party.

Any award for the payment of money may include pre-award and/or post-award interest.

1.10 Severability

If any provision of this Agreement is determined by a court of competent jurisdiction to be invalid, illegal or unenforceable in any respect, such determination shall not impair or affect the validity, legality or enforceability of the remaining provisions hereof, and each provision is hereby declared to be separate, severable and distinct.

1.11 Successors and Assigns

(a) This Agreement shall enure to the benefit of and shall be binding on and enforceable by the parties and, where the context so permits, their respective successors and permitted assigns. Neither this Agreement nor any of the rights or obligations under this Agreement are assignable or transferable by any party without the prior written consent of the other parties.

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(b) Notwithstanding the foregoing, the Purchaser shall be entitled to assign to any of its Affiliates its right to acquire and assume at Closing all or any portion of the Purchased Assets (including the assumption of the obligation to pay the applicable portion of the Purchase Price allocated to such Purchased Assets); provided that the Purchaser shall continue to be fully bound by and liable for the performance or non-performance of its obligations herein.

1.12 Amendment and Waivers

No amendment or waiver of any provision of this Agreement shall be binding on any party unless consented to in writing by such party. No waiver of any provision of this Agreement shall constitute a waiver of any other provision, nor shall any waiver constitute a continuing waiver unless otherwise provided.

The following two sections briefly identify the contents of all omitted exhibits and schedules to this Asset Purchase Agreement.  Upon request of the Securities Exchange Commission, the Company will furnish supplementally a copy of any of these items to the Commission.

1.13 Exhibits

The following Exhibits are attached to and form part of this Agreement:

Exhibit A    –    Concord Lease

Exhibit B    –    Deeley-HDMC Agreement

Exhitit C    –    Escrow Agreement

Exhibit D    –    License Agreement

Exhibit E    –    Non-Competition Agreement

Exhibit E1    –    Richmond Occupancy License

Exhibit F    –    Transitional Services Agreement

Exhibit G    –    Vendor Release

Exhibit H    –    HDMC Release

1.14 Schedules

The following Schedules are prepared and organized by the Vendor and are attached to and form part of this Agreement:

Schedule 1.1(d)    –    Receivables

Schedule 1.1(ff)     –    Dealer Agreements

Schedule 1.1(ccc)    –    Financial Statements

Schedule 1.11.1(ffff)    -    New HDFS Documents

Schedule 1.1(uuuu)     –    Purchaser Leased Equipment

Schedule 1.1(eeeee)    –    Terminated Harley-Davidson Agreements

Schedule 1.1(iiiii)    –    Vendor Contracts

Schedule 1.1(jjjjj)     –    Vendor Equipment

Schedule 2.1    –    Purchased Assets

Schedule 2.1(a)    –    Assumed Contracts

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Schedule 2.1(c)    –    Licenses and Permits

Schedule 2.1(e)     –    PAM Inventory

Schedule 2.1(f)     –    Motorcycle Inventory

Schedule 2.1(g)    –    Intellectual Property Assets

Schedule 3.1(b)(i)    –    Accounts Receivable Value Calculation

Schedule 3.1(b)(ii)     –    Prepaid Expenses Value Calculation

Schedule 3.1(b)(iii)    –    PAM Inventory Value Calculation

Schedule 3.1(b)(iv)    –    Motorcycle Inventory Value Calculation

Schedule 3.7    –    Purchase Price Allocation

Schedule 4.6(a)    –    Regulatory Consents

Schedule 4.6(b)    –    Contractual Consents

Schedule 4.11    –    Real Property

Schedule 4.15    –    Litigation

Schedule 4.17    –    Computer Systems

Schedule 4.18    –    Warranties and Discounts

Schedule 4.19    –    Insurance

Schedule 4.20    –    Environmental Matters

Schedule 4.22    –    Labour Relations and Collective Agreements

Schedule 4.23    –    Employees

Schedule 4.24    –    Employee Plans

Schedule 4.29    –    Marketing Plan

Schedule 4.33    –    Equity Interests

Any disclosure made by the Vendor in a Schedule in connection with a representation or warranty shall not apply to any other representations and warranties in this Agreement unless such Schedule cross-references another Schedule or representation and warranty and clearly indicates the manner in which the disclosure applies to such other Schedule or representation and warranty.

ARTICLE 2 - PURCHASE AND SALE OF PURCHASED ASSETS

2.1 Transfer of Purchased Assets

Subject to and upon the terms and conditions contained in this Agreement, the Vendor shall sell, assign and transfer to the Purchaser and the Purchaser shall purchase from the Vendor, all right, title and interest of the Vendor to certain of the Vendor’s property and assets used in connection with the Business as detailed in Schedule 2.1, being the property and assets specifically described in clauses (a) through (o) below (collectively, the “Purchased Assets”) at the Closing Date, free and clear of all Encumbrances:

(a) Assumed Contracts. Subject to Section 8.13, those Vendor Contracts subsisting in respect of the Business as set out in Schedule 2.1(a), including, for greater certainty, contracts relating to the maintenance, upkeep or support of any of the Purchased Assets (collectively, the “Assumed Contracts”);

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(b) Books and Records. All Books and Records relating to the Purchased Assets including, subject to Section 2.2(g), all personnel records and other records related to the Hired Employees;

(c) Licences and Permits. To the extent transferable, all licences, permits (including parking permits), approvals, consents, registrations, certificates and other regulatory authorizations and enrolments currently held or necessary, including under Applicable Law, for the lawful operation of the Business as now conducted and the use or ownership of the Purchased Assets, and any pending applications for or renewals of any of the foregoing (collectively, the “Permits”), including those described in Schedule 2.1(c);

(d) Accounts Receivable. All Accounts Receivable of the Vendor;

(e) PAM Inventory. The current parts, accessories and core general merchandise (“PAM”) inventory indicated as such in HDMC’s CIM system as at June 1, 2015 sold by HDMC and owned by the Vendor relating to the Business (collectively, the “PAM Inventory”) at the Closing Date, as detailed in Schedule 2.1(e);

(f) Motorcycle Inventory.The model year 2015 Harley-Davidson motorcycles sold by HDMC and owned by the Vendor relating to the Business at the Closing Date that constitute the: (i) Harley-Davidson motorcycles located at Fairview College set out on Schedule 2.1(f) (comprising three Harley-Davidson Street motorcycles and one Trike), and (ii) the Harley-Davidson motorcycles that constitute the Vendor’s or HOG’s, as applicable, company owned vehicles, press bikes and demo fleet but only to the extent that such motorcycles are used in connection with the Vendor’s “Test Our Metal” program, and are listed by vehicle identification number (VIN) on Schedule 2.1(f) (collectively, the “Motorcycle Inventory”);

(g) Intellectual Property. All of the Vendor’s right, title and interest in and to all the owned or licensed Intellectual Property listed below:

(i) all assumed fictional business names, trade names, registered and unregistered trademarks, service marks and applications for marks, used by the Vendor and any affiliate thereof in connection with the Business or any other activity related to or ancillary to the Business, but expressly excluding the Vendor’s name and any variation thereof, including the “Trev Deeley Motorcycle Collection” trademark and any other trademarks including the “Deeley” name;

(ii) all registered and unregistered copyrights and industrial designs in both published works and unpublished works;

(iii) all know-how, trade secrets, confidential or proprietary information, software, technical information, data, manufacturing, industrial and business processes and technology, plans, drawings and blue prints;

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(iv) without limiting paragraph (iii) above, all computer systems operated by the Vendor in the Business, including the Systems (and, without limitation, (i) the UltraComm software system which all Dealers and the Vendor utilize for the purposes of content distribution and consumption, facilitation of transaction processing, referential lookup, authentication to HDMC systems, (ii) all other systems identified in Schedule 4.17, and (iii) all completed enhancements as of the Closing Date), including physical possession of such software, all object code and source code, and copies whether in hard copy or electronic format of any and all supporting documentation or manuals;

(v) all rights in product labels and other related materials, including French language translations thereof, and including physical possession of any printed labels (both English and/or French) and any electronic files constituting word processing or desktop publishing files of such labels, and the product label printer and any related hardware, inventory of labels, label stock or related materials;

(vi) all rights in marketing materials, including French language translations thereof, and including physical possession of any printed materials (both English and/or French) and any electronic files constituting word processing or desktop publishing files of such materials; and

(vii) all other French language translations of the Vendor’s documents and including physical possession of any printed materials (both English and/or French) and any related electronic files,

(collectively, the “Intellectual Property Assets”), including as set out in Schedule 2.1(g);

(h) Unexpired Term of the Distribution Agreement. The benefit of the exclusive right to distribute in Canada Harley-Davidson motorcycles, parts and accessories, apparel and other merchandise for the period from August 4, 2015 to July 31, 2017 (the “Unexpired Term”) as granted to the Vendor by the Distributorship Agreement;

(i) Customer and Supplier Information. All data and information relating to the Business related to or in respect of customers and suppliers lists, records, files, and contact details, telephone numbers, information as to purchases, preferences and consumer behaviour whether in hard copy or electronic readable format, including for greater certainty any of such data and information constituting Personal Information, but excluding such information as it relates to the Dealership Business;

(j) Harley Owners Group Canada. The Vendor shall assign or shall cause HOG to assign all of HOG’s assets (which assets for the purposes of this Agreement shall be deemed to be Purchased Assets of the Vendor), including all of HOG’s rights, title and interest in and to (i) any and all data and information comprising its owners membership list and related data and files, including for greater certainty any of such

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data and information constituting Personal Information, and (ii) HOG Magazine Canada;

(k) Telephone Numbers. All telephone and facsimile numbers and other communications numbers, addresses and points of contact of the Business, but expressly excluding the telephone and facsimile numbers and other communications numbers, addresses and points of contact of the Dealership Business;

(l) Prepaid Expenses. Without limiting any of the foregoing, the benefit of prepaid expenses relating to the Purchased Assets whether or not reflected on the Closing Balance Sheet (collectively, the “Prepaid Expenses”);

(m) Warranty Rights. All warranty rights accruing to the Vendor in respect of any of the other Purchased Assets;

(n) Consents. All consents related to the Business obtained by the Vendor from a third Person which permit or purport to permit the sending of CEMs to the third Person in compliance with CASL; and

(o) Goodwill. All goodwill relating to the Business, together with the exclusive right for the Purchaser to represent itself as carrying on the Business in succession to the Vendor and the right to use any words indicating that the Business is so carried on.

2.2 Excluded Assets

The Purchased Assets shall include only those assets expressly contemplated in the foregoing Section 2.1 and listed in Schedule 2.1, and the Purchaser shall in no way be construed to acquire any interest in any of the other property and assets of the Vendor used in or related to the Business or any other business or activity (collectively, the “Excluded Assets”). For greater certainty and without limiting the foregoing, the term “Excluded Assets” includes the following:

(a) Dealer Agreements. All Dealer Agreements;

(b) Taxes. Tax refunds receivable by the Vendor and all Tax Returns pertaining to corporate income taxes of the Vendor;

(c) Investments. All investments of the Vendor in marketable or other securities;

(d) Inter-Company Debt. All indebtedness of any Affiliate of the Vendor to the Vendor;

(e) Insurance. All property and public liability insurance policies of the Vendor and all claims and rights thereunder;

(f) Corporate Records. All minute books, share certificate books, corporate seals and other corporate records of the Vendor;

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(g) Personnel Records. All personnel records and other records that the Vendor is required by Applicable Law to retain, provided that the Purchaser shall be provided with copies thereof;

(h) Employee Plans. All rights in connection with the assets of the Employee Plans;

(i) Excluded Equipment. The Vendor Equipment;

(j) Cash. Any Cash in the Business or the Dealership Business;

(k) Vendor’s Name. All right, title, and interest in and to the Vendor’s name and any variation thereof, including the “Deeley” name;

(l) Power Sports Services. The Vendor’s shares in Power Sports Services.

(m) E-mail and Domains. All rights in internet websites and internet domain names owned by or registered in the name of the Vendor, whether or not presently used, and all email addresses presently used by personnel of the Vendor including email addresses provided by third party service providers;

(n) Trev Deeley Trademark. All right, title and interest in and to the Vendor’s trade-mark registration for “Trev Deeley Motorcycle Collection” and all related and associated intellectual property rights; and

(o) GE Receivables. The GE Receivables.

2.3 Delivery Up of Possession of Purchased Assets to the Purchaser

If following the Closing, any of the Purchased Assets or any proceeds in respect thereof shall at any time come into the possession of or under the control of the Vendor or any of its employees, officers or agents, such assets and/or proceeds, as applicable, shall be held by the Vendor in trust for the benefit of the Purchaser. Within ten (10) Business Days from the date on which the Vendor or any of its employees, officers or agents, come into possession of or obtain control over any of such assets and/or proceeds, as applicable, the Vendor shall by notice in writing delivered to the Purchaser in accordance with the provisions hereof, so advise the Purchaser. The Vendor shall have a duty to forthwith account and deliver over to the Purchaser any of such assets and/or proceeds, as applicable.

2.4 Delivery Up of Possession of Excluded Assets to the Vendor

If any of the Excluded Assets or any proceeds in respect thereof shall at any time come into the possession of or under the control of the Purchaser or HDMC or any of their respective employees, officers or agents, such assets and/or proceeds, as applicable, shall be held by the Purchaser or HDMC, as applicable, in trust for the benefit of the Vendor. Within ten (10) Business Days from the date on which the Purchaser or HDMC or any of their respective employees, officers or agents, come into possession of or obtain control over any of such assets and/or proceeds, as applicable, the Purchaser or HDMC shall by notice in writing delivered to the Vendor in accordance with the

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provisions hereof, so advise the Vendor. The Purchaser and HDMC shall have a duty to forthwith account and deliver over to the Vendor any of such assets and/or proceeds, as applicable.

ARTICLE 3 - PURCHASE PRICE

3.1 Purchase Price

Except as otherwise provided in this Agreement, including any adjustments or abatements provided for herein as at the Time of Closing, the purchase price (the “Purchase Price”) payable by the Purchaser to the Vendor for the Purchased Assets shall be the aggregate of:

(p) the sum of $50,000,000,

(q) plus:

(i) the value of the Accounts Receivable, as determined in accordance with the calculation method set out in Schedule 3.1(b)(i) and disclosed in the Estimated Closing Balance Sheet;

(ii) the value of the Prepaid Expenses, as determined in accordance with the calculation method set out in Schedule 3.1(b)(ii) and as disclosed in the Estimated Closing Balance Sheet;

(iii) the value of the PAM Inventory, as determined in accordance with the calculation method set out in Schedule 3.1(b)(iii) and as disclosed in the Estimated Closing Balance Sheet;

(iv) the value of the Motorcycle Inventory, as determined in accordance with the calculation method set out in Schedule 3.1(b)(iv), as disclosed in the Estimated Closing Balance Sheet; and

(v) the amount of coop advertising expenses incurred by the Dealers between July 1, 2015 and the Closing Date, inclusive, and paid by the Vendor to the Dealers as a reimbursement of all or part of such expenses, as disclosed in the Estimated Closing Balance Sheet,

(r) minus:

(i) the returns reserve amount of $72,327;

(ii) the amount of any rebates to be paid to the Dealers pursuant to the terms of the Vendor’s Road of Champions program for sales of motorcycles made prior to the Closing Date and not yet paid or credited by the Vendor, as disclosed in the Estimated Closing Balance Sheet; and

(iii) the Accounts Payable, as disclosed in the Estimated Closing Balance Sheet.

3.2 Satisfaction of the Purchase Price and Other Closing Payments

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At the Time of Closing, the Purchaser shall satisfy the amount set forth in Section 3.1 as follows:

(a) the amount of $1,500,000 of the Purchase Price (the “Escrow Amount”) shall be paid by the Purchaser to the Escrow Agent to be held in accordance with the terms of the Escrow Agreement; and

(b) the balance of the Purchase Price shall be paid by the Purchaser by wire transfer to the Vendor or as it may otherwise direct.

3.3 Assumption of Certain Liabilities by the Purchaser

Subject to the provisions of this Agreement, the Purchaser agrees to assume, pay, satisfy, discharge, perform and fulfill, from and after the Time of Closing, the following liabilities and obligations (the “Assumed Liabilities”) and no others:

(a) the liabilities and obligations of the Vendor that arise from and after the Closing Date under the Assumed Contracts, other than any liabilities or obligations arising out of or relating to a breach that occurred prior to the Closing Date. For greater certainty, the Purchaser shall not assume or be liable for any liabilities and obligations of the Vendor that have accrued, even if not due, or become outstanding or otherwise relate to events that have occurred prior to the Closing Date;

(b) any liabilities or obligations of the Vendor under its current return policy provided to customers in the ordinary course of business prior to the Closing Date other than any liabilities or obligations arising out of or relating to any return claims notified to the Vendor prior to the Closing Date;

(c) any liabilities or obligations of the Vendor to provide rebates to Dealers in connection with the Road of Champions program;

(d) amounts related to the operation of the Business owing to any Person by the Vendor arising out of the Assumed Contracts, the Dealer Agreements, and any programs implemented with Dealers in connection with the Business (excluding coop advertising with Dealers), in the ordinary course of the Business, and due and payable as of the Closing Date (the “Accounts Payable”); and

(e) the liabilities and obligations of the Vendor that arise from and after the Closing Date under the Intellectual Property, the Licenses, warranty rights, obligations, andthe other ownership and membership assets,to the extent any such assets are included in the Purchased Assets.

3.4 Excluded Liabilities

The Purchaser shall not assume, pay, satisfy, discharge, perform or fulfil and the Vendor shall be solely responsible for all other liabilities and obligations of the Vendor whether related to the Business and the Purchased Assets or otherwise (the “Excluded Liabilities”). For greater certainty, the Vendor shall be responsible for all of its liabilities that are not Assumed Liabilities.

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3.5 Estimated Closing Date Financial Statement

The Vendor shall at least five (5) Business Days prior to Closing, in good faith, complete and deliver to the Purchaser the Estimated Closing Balance Sheet as of the Closing Date, prepared in accordance with GAAP applied consistently with the Vendor’s past practices used in the preparation of the Balance Sheets, and a calculation of the estimated Purchase Price as of the close of business on the Closing Date. Upon the reasonable request of the Purchaser, the Vendor shall promptly provide additional information in respect of the calculation of the Estimated Closing Balance Sheet and the estimated Purchase Price.

3.6 Working Capital and Liabilities Adjustment

(a) Prior to the date which is 90 days after the Closing Date, the Purchaser shall prepare and deliver to the Vendor a statement (the “Closing Date Financial Statement”) including and setting forth: (i) the Closing Balance Sheet; (ii) a calculation of the Purchase Price; and (iii) a calculation of the adjustment, if any, to be made pursuant to this Section 3.6 (the “Purchase Price Adjustment”). The Closing Balance Sheet shall be prepared by the Purchaser in accordance with GAAP applied consistently with the Vendor’s past practices used in the preparation of the Balance Sheets. The Vendor shall, as reasonably requested by the Purchaser, cooperate fully in the preparation of the Closing Balance Sheet.

(b) If the Vendor disagrees with the Purchaser’s calculation of the Purchase Price Adjustment (the “Dispute”), the Vendor shall deliver written notice of the Dispute (the “Dispute Notice”) to the Purchaser within thirty (30) days after the Vendor’s receipt of the Closing Balance Sheet (the “Dispute Period”). The Dispute Notice shall set forth in reasonable detail the basis for the Vendor’s disagreement with the Purchaser’s determination of the Purchase Price Adjustment, the dollar amounts of the proposed revisions thereto and the Vendor’s good faith estimate of the Purchase Price Adjustment if and to the extent determinable. The Purchaser shall permit the Vendor and its representatives to review all working papers and documentation used or prepared in connection with the preparation of, or which otherwise form the basis of, the Closing Balance Sheet and the Purchaser’s calculation of the Purchase Price Adjustment. If no Dispute Notice is received by the Purchaser during the Dispute Period, then the Closing Balance Sheet (and the calculations reflected therein) shall be deemed to have been accepted and agreed to by the Vendor in the form in which it was delivered to the Vendor and shall be final and binding upon the parties. If the Purchaser receives a Dispute Notice from the Vendor during the Dispute Period, the Purchaser and the Vendor shall attempt to resolve the Dispute and agree in writing upon the final Purchase Price Adjustment within ten (10) days after the Purchaser’s receipt of the Dispute Notice.

(c) If the Purchaser and the Vendor are unable to resolve the Dispute within the ten (10) day period after the Purchaser’s receipt of the Dispute Notice, the Purchaser and the Vendor shall jointly engage a mutually agreed nationally recognized accounting firm (the “Arbitrating Accountant”). For the purposes of this Section 3.6(c),if the parties are unable to agree on the appointment of the Arbitrating Accountant within

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five (5) Business Days of the end of such ten (10) day period, then either party may apply to a judge of the Superior Court of Ontario to have a nationally recognized firm of chartered accountants appointed as the Arbitrating Accountant for the purposes of this Section. The Arbitrating Accountant will not be the accountant or auditor for HDMC, the Purchaser, or the Vendor. The Arbitrating Accountant’s function shall be to review only those items that are in Dispute with respect to the determination of the Purchase Price Adjustment and to resolve such Dispute in accordance with the requirements of this Section 3.6(c). The Arbitrating Accountant shall, as promptly as possible and in any event within thirty (30) days after the date of its appointment, render its decision on the Dispute in writing to the Purchaser and the Vendor, together with a revised Purchase Price Adjustment reflecting its decision with respect to each of the items in Dispute. The date on which the Purchase Price Adjustment is finally determined in accordance with this Section is referred to as the “Determination Date”. The Arbitrating Accountant’s decision shall be final and binding upon the parties, and the Purchase Price Adjustment, as revised pursuant to the Arbitrating Accountant’s decision, shall be final and binding, barring manifest error. The Arbitrating Accountant, in its sole and absolute discretion, shall determine the proportion of its fees and expenses to be paid by the Vendor and the Purchaser, respectively, based primarily on the degree to which the Arbitrating Accountant has accepted the positions of the respective parties in relation to the Dispute.

(d) If it is determined pursuant to this Section 3.6 that the amount of the Final Purchase Price is greater than the amount of the Estimated Purchase Price then the Purchaser shall pay to the Vendor the amount which is the difference between the two amounts.

(e) If it is determined pursuant to this Section 3.6 that the amount of the Final Purchase Price, is less than the amount of the Estimated Purchase Price the Vendor shall pay to the Purchaser of such amount which is the difference between the two amounts.

(f) Any amount to be paid pursuant to this Section 3.6 by one party to another party shall be paid within 30 days after (A) the conclusion of the Dispute Period, if the Vendor does not deliver a Dispute Notice; or (B) the Determination Date, if the Vendor delivers a Dispute Notice.

3.7 Allocation of the Purchase Price

The Purchase Price, together with the agreed fair market value, if any, of the Assumed Liabilities, shall be allocated in the manner specified in Schedule 3.7. The Purchaser and the Vendor agree to be bound by such allocation and to report the purchase and sale of the Purchased Assets for all federal, provincial and local Tax purposes in a manner consistent with such allocation.

3.8 ETA Election

If applicable, at the Closing the Purchaser and the Vendor shall execute jointly an election under subsection 167(1) of the ETA to have the sale of the Purchased Assets take place on a GST/HST-free basis under the ETA. The Purchaser shall file the election in the manner and within the time prescribed by the relevant legislation. Notwithstanding anything to the contrary in this

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Agreement, the Purchaser shall indemnify and hold the Vendor harmless in respect of any GST/HST, penalties, interest and other amounts which may be assessed against the Vendor as a result of the transactions under this Agreement not being eligible for such election or as a result of the Purchaser’s failure to file the election within the prescribed time.

3.9 ITA Elections

(c) If available, the Purchaser and the Vendor shall make and file, in a timely manner, a joint election to have the rules in section 22 of the ITA, and any equivalent or corresponding provision under applicable provincial or territorial tax legislation, apply in respect of the Accounts Receivable that are the subject of that election and shall designate therein that portion of the consideration allocated to the Accounts Receivable that are the subject of such election in accordance with the procedures set out in Section 3.7 of this Agreement as consideration paid by the Purchaser to the Vendor.

(d) The Purchaser shall jointly elect with the Vendor in accordance with subsection 56.4(7) of the ITA to have the provisions of subsection 56.4(5) of the ITA apply to the restrictive covenants granted by the Vendor in the Non-Competition Agreement. The foregoing election shall be filed in the manner and within the time prescribed in subsection 56.4(14) of the ITA.

(e) The Purchaser and the Vendor shall, if applicable, jointly execute and file an election under subsection 20(24) of the ITA in the manner required by subsection 20(25) of the ITA and under the equivalent or corresponding provisions of any other applicable provincial or territorial statute, in the prescribed forms and within the time period permitted under the ITA and under any other applicable provincial or territorial statute, as to such amount paid by the Vendor to the Purchaser for assuming future obligations. In this regard, the Purchaser and the Vendor acknowledge that a portion of the Purchased Assets transferred by the Vendor pursuant to this Agreement and having a value equal to the amount elected under subsection 20(24) of the ITA and the equivalent provisions of any applicable provincial or territorial statute, is being transferred by the Vendor as a payment for the assumption of such future obligations by the Purchaser.

3.10 Transfer Taxes

Subject to Section 3.8, the Purchaser shall be liable for and shall pay all federal and provincial sales taxes (including any GST/HST, provincial sales taxes and land transfer taxes) and all other similar taxes, duties, fees or other like charges of any jurisdiction payable in connection with the purchase of the Purchased Assets in addition to the Purchase Price. For greater certainty, the Vendor shall be responsible for all income taxes payable by the Vendor as a result of the transactions contemplated herein.

ARTICLE 4 - REPRESENTATIONS AND WARRANTIES
OF THE VENDOR

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The Vendor represents and warrants, as of the date hereof, to the Purchaser as follows, and the Vendor acknowledges that the Purchaser is relying on such representations and warranties in connection with its purchase of the Purchased Assets (for the purposes hereof, any of HOG’s assets shall be deemed to be Purchased Assets of the Vendor):

4.1 Organization

The Vendor is a company validly existing under the laws of the Province of British Columbia and has the corporate power to own or lease its property and to carry on the Business as now being conducted by it, and is duly qualified as a corporation to conduct the Business in each jurisdiction where qualification is necessary, and to execute and deliver and perform its obligations under this Agreement.

4.2 Authorization and Enforceability

(a) The Vendor has taken all necessary corporate action, steps and proceedings to approve or authorize the transfer of the Purchased Assets to the Purchaser and the execution and delivery of this Agreement and the other agreements and documents contemplated hereby, and the performance by it of its obligations under this Agreement and the other agreements and documents contemplated hereby; and, without limiting the foregoing, has caused all necessary meetings or written corporate actions of its directors and shareholders, as applicable, to be held or executed for such purpose.

(b) This Agreement has been duly executed and delivered by the Vendor and constitutes a legal, valid and binding obligation of it, enforceable against it by the Purchaser in accordance with its terms, except as enforcement may be limited by bankruptcy, insolvency and other laws affecting the rights of creditors generally and except that equitable remedies may only be granted in the discretion of a court of competent jurisdiction.

4.3 Tax Matters

(a) The Vendor has duly and timely filed all Tax Returns required to be filed by it with the appropriate Tax Authority so as to prevent any Encumbrance of any nature on the Purchased Assets and has paid all Taxes relating to the Business when due.

(b) The Vendor has duly and timely withheld all Taxes and other amounts required by Applicable Law to be collected or withheld by it, including Taxes and other amounts required to be withheld by it in respect of any amount paid or credited or deemed to be paid or credited by it to or for the account or benefit of any Person, including any employees, officers or directors and any non-resident Person, and has duly and timely remitted to the appropriate Tax Authority such Taxes and other amounts required by Applicable Law to be remitted by it.

4.4 Residency of Vendor

The Vendor is not a non-resident of Canada for the purposes of the ITA.

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4.5 No Violation

(a) The execution and delivery of this Agreement by the Vendor and, subject to Section 4.6, the consummation of the transactions herein provided for will not result in a breach or violation of any of the provisions of, or constitute a material default under, or conflict with or cause the acceleration of any obligation of the Vendor under: (i) any Contract listed on Schedule 2.1(a); (ii) any provision of the constating documents or by-laws or resolutions of the board of directors (or any committee thereof) or shareholders of the Vendor; (iii) any Permit referred to on Schedule 2.1(c); or (iv) any Applicable Law.

(b) The execution and delivery of this Agreement by the Vendor and the consummation of the transactions herein provided for will not result in the creation or imposition of any Encumbrance on any of the Purchased Assets.

4.6 Consents and Approvals

(a) Except as described in Schedule 4.6(a), there is no requirement for the Vendor to make any filing with, give any notice to or obtain any Permit from any Authority as a condition to the lawful consummation of the transactions contemplated by this Agreement, other than those which relate solely to the identity of the Purchaser or the nature of any business carried on by the Purchaser.

(b) Except as described in Schedule 4.6(b), there is no requirement under any Contract listed in Schedules 2.1(a) to give any notice to, or to obtain the consent or approval of, any party to such agreement, instrument or commitment relating to the consummation of the transactions contemplated by this Agreement.

4.7 Accounts Receivable

All Accounts Receivable that are reflected on the Closing Balance Sheet or on the Accounting Records of the Vendor as of the Closing Date represent or will represent valid obligations arising from sales actually made or services actually performed by the Vendor in the ordinary course of business. Such Accounts Receivable are or will be as of the Closing Date collectable net of the respective reserves shown on the Closing Balance Sheet (which reserves are adequate and calculated consistent with past practice and will not represent a Material Adverse Change in the composition of such Accounts Receivable in terms of aging) within one hundred twenty (120) days following the Closing Date. There is no contest, claim, defence or right of set off, other than returns in the ordinary course of business of the Vendor, under any Contract with any account debtor of an Account Receivable relating to the amount or validity of such Account Receivable.

4.8 Inventories

All items included in the Inventories consist of a quality and quantity useable and saleable in the ordinary course of business of the Vendor. The Vendor is not in possession of any inventory not owned by the Vendor, except for sales to Dealers pending delivery. Inventories now on hand were purchased in the ordinary course of business of the Vendor.

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4.9 Title to Personal and other Property

The Purchased Assets are owned beneficially by the Vendor with good title thereto, free and clear of all Encumbrances. The Purchased Assets, the Purchaser Leased Equipment and the Excluded Assets constitute all the assets owned by the Vendor and used in the Business. All tangible assets forming part of the Purchased Assets are in good operating condition and are in a good state of repair and maintenance, reasonable wear and tear excepted. The Purchaser Leased Equipment is all in good working condition and is in a good state of repair and maintenance, reasonable wear and tear excepted.

4.10 No other Agreement to Purchase

No person other than the Purchaser has any written or oral agreement or option or any right or privilege (whether by law, pre-emptive or contractual) capable of becoming an agreement or option for the purchase or acquisition from the Vendor of any of the Purchased Assets other than pursuant to purchase orders accepted by the Vendor for products in the ordinary course of business.

4.11 Location of Real Property

Schedule 4.11 sets forth the address and area descriptions of all real property that is owned or leased by the Vendor.

4.12 Concord Property and Richmond Property

The Vendor is not a party to any lease or agreement to lease in respect of any real property, whether as a lessor or lessee, in connection with the Business, other than its lease of the Concord Property, to be terminated on Closing, and the Richmond Lease.

4.13A    Real Property

(a) To the Vendor’s knowledge, the Richmond Lease is in full force and effect and no party is in breach under the Richmond Lease.

(b) To the Vendor’s knowledge, all rental and other payments due and payable by the Vendor as tenant under the Richmond Lease have been duly paid and to the Vendor’s knowledge the Vendor is not otherwise in material default in meeting its obligations under the Richmond Lease.

(c) To the Vendor’s knowledge, no event exists which, with the passing of time or the giving of notice, or both, would constitute a default by any party to the Richmond Lease and, to the Vendor’s knowledge, no party to the Richmond Lease is claiming any such default or taking any action purportedly based upon any such default.

(d) To the Vendor’s knowledge, all improvements forming part of the Leased Richmond Property are in good operating condition and in a state of good maintenance and repair adequate and suitable for their current use by the Vendor.

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(e) No notice or proceeding in respect of an expropriation in respect of the Lease Richmond Property by any governmental Authority has been received by the Vendor, and to the Vendor’s knowledge, no part of the Leased Richmond Property has been taken or expropriated by any governmental Authority.

4.13 Location of the Purchased Assets

As of the Closing Date, all of the tangible Purchased Assets and Purchaser Leased Equipment will be located on or in transit to either the Concord Property or the Richmond Property.

4.14 Compliance with Laws; Permits

The Vendor has complied in all material respects with all Applicable Laws (save and except for Environmental Laws, the compliance of which is dealt with in Section 4.20 hereto). Schedule 2.1(c) sets out a complete and accurate list of all Permits, and including Environmental Permits, held or granted to the Vendor, which Permits are all those necessary for the operation of the Business as currently conducted. All such Permits are valid, subsisting and in good standing and the Vendor is not in default or breach of any Permit and, to the knowledge of the Vendor, no proceeding is pending or threatened to revoke or limit any Permits.

4.15 Litigation

Except as described in Schedule 4.15, there are no applications, orders, actions, suits, claims, counter-claims, cross-suits, third party claims, appeals, proceedings, audits, investigations or complaints (whether or not purportedly on behalf of the Vendor) pending or, to the knowledge of the Vendor, threatened, at law or in equity or before or by any Authority affecting the Business or the Purchased Assets, which when considered individually or in the aggregate constitute a Material Adverse Change.

4.16 Vendor Contracts, Dealer Agreements and Assumed Contracts

Schedule 1.1(iiiii) sets out a complete list of the Vendor Contracts, including Equipment Leases, that are necessary to operate the Business as at the date hereof and the Closing Date. Except as disclosed in Schedules 1.1(iiiii), 4.6(b) and 4.17, the Vendor has made available to the Purchaser complete copies of the Vendor Contracts. Except as disclosed in Schedule 1.1(iiiii), all the Assumed Contracts and the Dealer Agreements are in good standing and in full force and effect and no material default has occurred thereunder, and, to the knowledge of the Vendor, no event, condition or occurrence exists which, after notice or lapse of time or both, would constitute a default thereunder, except in each case where such default would not, individually or in the aggregate with all such other defaults, result in a Material Adverse Change. For greater certainty, a default shall be considered material if such default, after notice or lapse of time or both, could result in the termination of the Assumed Contract or the Dealer Agreement or a material penalty pursuant to the terms of the Assumed Contract or the Dealer Agreement.

4.17 Computer Systems

Except as set out in Schedule 4.17, the Vendor has the right to sell, convey or assign all of the operating systems and software set out in Schedule 4.17 and any additional key operating systems

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and key software owned or leased by the Vendor, and utilized in the Business (all such operating systems and software shall be collectively referred to herein as the “Systems”). The Systems, including any modifications or customizations thereto, are as of the date of his Agreement, and shall so be at Closing: (a) fully operational and functioning as they are required to function and operate to meet purposes and requirements of the Business; and (b) to the knowledge of the Vendor, free from any computer viruses, worms, Trojan horses or other malicious programs or code. All of the Systems owned or leased by the Vendor, and utilized in the Business are either properly and validly licensed for its intended use in the Business, or wholly owned by the Vendor. All enhancements, modifications and customizations for the Systems are wholly owned by the Vendor. All contracts required for the operation and function of the Systems utilized in the Business are identified as Assumed Contracts in accordance with Section 2.1(a) of this Agreement. Any ownership, Assumed Contract or functionality issues with respect to the Systems will not, either individually or in the aggregate, materially affect the Business. Except as set out in Schedule 4.17, all enhancements, modifications or customizations to the Systems scheduled or engaged as of the date of this Agreement shall be completed, tested and reasonably satisfactory for the intended purposes of such enhancements, modifications or customizations on or before Closing. Schedule 4.17 lists, to the extent that such information is known by the Vendor, the Systems that are owned or leased by the Vendor and utilized in the Business as well as: (i) the license agreements whereby the Vendor licenses in or licenses out the Systems or modules thereof; and (ii) enhancements, modifications and customizations to the Systems, including enhancements, modifications or customizations to the Systems that are scheduled or engaged as of the date of this Agreement. All physical access keys and authentication codes necessary to access and operate the Systems and licenses applicable thereto can be transferred or assigned to the Purchaser and will be delivered to the Purchaser on or before Closing.

4.18 Warranties and Discounts

Other than the warranty obligations described in Schedule 4.18, the Vendor has not given any written or oral warranty regarding any of the products sold or leased or services provided as part of the Business, or incurred any repair or maintenance obligations in favour of any customers of the Business or entered into any agreement with any customer which would require the repurchase of goods, price adjustment, refund, discount or concession to any customer after Closing. Except for any claim referenced in Schedule 4.15, to the knowledge of the Vendor, no Person has any valid claim against the Vendor or the Business under Applicable Law relating to unfair competition, false advertising or other similar claims arising out of product or service warranties, specifications, manuals, brochures or other advertising materials relating to the Business.

4.19 Insurance

The Vendor has all of its property and assets insured against loss or damage by all insurable hazards or risks on a replacement cost basis and such insurance coverage will be continued in full force and effect as of the Time of Closing. Copies of all applicable policies of insurance have been provided by the Vendor to the Purchaser, a list of which is included in Schedule 4.19.

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4.20 Environmental

Except as disclosed in Schedule 4.20 (or the relevant portion thereof where so indicated below):

(a) Except as described in Schedule 4.20, the Business is in material compliance with Environmental Laws, and there are no orders under or pursuant to Environmental Laws by any Authority issued, pending or, to the Vendor’s knowledge, threatened with respect to the Business or the Purchased Assets.

(b) The Vendor has not received any written notice from any Person of a violation or claim under any Environmental Law, nor any written inquiry, written request for information, or demand letter under any Environmental Law relating to such non-compliance or claim relating to the Business or the Purchased Assets.

(c) The Vendor has all material Environmental Permits required under Environmental Laws for the operation of the Business. Each such Environmental Permit is valid, subsisting and in good standing, and the Vendor is not in default or breach of any such Environmental Permit and all such Environmental Permits shall be maintained in full force and effect by the Vendor through the Time of Closing in accordance with Environmental Laws.

4.21 Intellectual Property

Schedule 2.1(g) sets out all Vendor Intellectual Property which is the subject of a registration or pending application, is capable of being registered or is otherwise reasonably identifiable as to content or location. The Vendor Intellectual Property is all of the intellectual property of the Vendor that is necessary for the operation of the Business as currently conducted. The Vendor is the beneficial owner of or has the right to use such Intellectual Property, without payment to any third party, and, except as set out in Schedule 4.6(b), is not bound by any contract whatsoever that limits or impairs its ability to sell, transfer, assign or convey, or that otherwise affects such Intellectual Property. The Vendor has not granted any interest in or right to use all or any portion of such Intellectual Property to any other person. The Vendor has not received any notice that the use of the Intellectual Property infringes upon or breaches any industrial or intellectual property rights of any other person.

4.22 Labour Relations and Collective Agreements

None of the Employees is represented by a trade union or any other employee association or organization. To the knowledge of the Vendor, other than as disclosed in Schedule 4.22, there are not any current attempts to organize or establish any trade union or employee association with respect to any of the Employees, nor is there any certification of any such union with regard to a bargaining unit. There are no applications for certification pending and no pending or outstanding applications, proceedings or orders of any labour relations board or similar court, tribunal or board concerning any of the Employees. There are no threatened applications to be brought before any labour relations board or similar court, tribunal or board concerning the Employees. There are no

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outstanding grievances or arbitration proceedings and there are no unsatisfied arbitration awards to which the Vendor is a party.

4.23 Employees

(a) Schedule 4.23 contains a complete and accurate list of all individuals by employee number who are full-time, part-time or casual employees or individuals engaged on contract to provide employment or consulting services to the Vendor in connection with the Business (including any individuals employed by or providing services to HOG and identified as such, with respect to whom, any reference to the Vendor shall be deemed to be a reference to HOG, the “Employees”), other than Don James and Malcolm Hunter, as of the date hereof specifying the length of hire, title or classification and rate of salary or hourly pay and commission or bonus entitlements (if any) for each such Employee. The Purchaser agrees to keep such Employee information confidential.

(b) All written employment, management and consulting Contracts pursuant to which Employees have been engaged by the Vendor are set out in Schedule 2.1(a) and, except as disclosed in Schedule 2.1(a), there are no incentives or special compensation arrangements, contracts or agreements with respect to any Employees of the Vendor that would become Assumed Liabilities.

(c) The Vendor has duly and timely made all deductions (including Tax deductions) required by Applicable Law or by Contract to be made from employee wages, salaries or benefits relating to a period ending on or prior to the Closing Date and has duly and timely remitted the amounts deducted and all related employer contributions required to the appropriate insurers and Authorities for all periods ending on or prior to the Closing Date.

(d) The Vendor is in compliance in all material respects with all applicable Employment Legislation.

(e) To the knowledge of the Vendor, there are no circumstances, claims or frequency of claims which may expose the Purchaser to any charges or assessments on account of workplace safety and insurance or workers’ compensation, other than the standard charges or assessments for the rate group and classification of the Business.

(f) Except as disclosed in Schedule 4.23, no Employee or former Employee of the Vendor has made and, to the knowledge of the Vendor, no Employee or former employee of the Vendor has threatened to make a claim for any benefits under any indemnity, sickness and accident, long term disability or workers’ compensation plan or arrangement or any other form of disability benefit program. All assessments, penalties, fines, levies, charges, surcharges, Taxes, premiums or other amounts due and payable and relating to any disability insurance arising on or prior to the Closing Date or relating to a period ending on or prior to the Closing Date have been or will be paid by the Vendor on or prior to the Time of Closing.

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(g) Other than as disclosed in Schedule 4.23, there are no complaints, applications, investigations, orders, prosecutions or proceedings against the Vendor under the Pay Equity Act (Ontario) or comparable legislation.

4.24 Employee Plans

(a) Schedule 4.24 identifies each retirement, pension, supplemental pension benefit, bonus, stock purchase, profit sharing, stock option, deferred compensation, severance or termination pay, insurance, medical, hospital, dental, vision care, drug, sick leave, disability, salary continuation, legal benefits, unemployment benefits, vacation, pay equity, incentive or other compensation plan or arrangement or other employee benefit which is maintained, or otherwise contributed to or required to be contributed to, by the Vendor for the benefit of Employees (the “Employee Plans”). The Vendor has made available to the Purchaser summaries or current and complete copies of all Employee Plans.

(b) To the knowledge of the Vendor, no written or oral representations or promises have been made to the Employees to establish new employee plans or to increase the benefits under the existing Employee Plans.

(c) None of the Employee Plans is a “registered pension plan” as that term is defined in the ITA.

4.25 Books and Records

The Books and Records, all of which have been made available to the Purchaser (other than personnel records and other records relating to Employees, which will only be provided to the Purchaser on the Closing date, as they relate to Hired Employees), are complete and correct in all material respects and represent actual, bona fide transactions and have been maintained in accordance with sound business practices, including the maintenance of an adequate system of internal controls. The minute books of the Vendor, all of which have been made available to the Purchaser, contain accurate and complete records in all material respects of all meetings held, and corporate action taken, by the shareholders, the board of directors and committees of the board of directors, and no meeting of any shareholders, board of directors or committee has been held for which minutes have not been prepared or are not contained in such minute books.

4.26 No Undisclosed Liabilities

The Vendor has no liability that would be required to be reflected or reserved against in a balance sheet prepared in accordance with GAAP, except for liabilities reflected or reserved against in the Existing Balance Sheets and current liabilities incurred in the ordinary course of business of the Vendor since the respective dates of the Existing Balance Sheets.

4.27 Financial Statements and Financial Books and Records

(a) The Financial Statements have been prepared in accordance with GAAP and fairly present:

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(i) the financial position of the Business as of the dates shown in the Financial Statements; and

(ii) the results of operations of the Business for the periods indicated in the Financial Statements.

(b) All financial transactions relating to the Business have been accurately recorded in the Books and Records of the Vendor, a true and complete copy of which has been made available to the Purchaser.

(c) The Closing Balance Sheet will fairly present, in all material respects the financial condition of the Vendor as at the date of such balance sheets, all in accordance with GAAP. The Closing Balance Sheet will reflect the consistent application of such accounting principles throughout the periods involved. The Closing Balance Sheet will be prepared from and are in accordance with the Accounting Records of the Vendor.

(d) The Vendor has also delivered to the Purchaser copies of all letters from the Vendor’s accountants to the Vendor or its board of directors or audit committee in connection with or relating to the financial condition and results from operations, Accounting Records, Books and Records, or financial statements of the Vendor, during the five (5) years preceding the execution of this Agreement, together with copies of all responses thereto.

4.28 Conduct of Business in Ordinary Course

Other than the termination of the Distributorship Agreement effective July 31, 2017, the proposed wind-up and dissolution of HOG, and the proposed entry into this Agreement, since December 31, 2014;

(a) the Business has been operated in the ordinary course of business, consistent with past practice, and the Vendor has not;

(i) incurred any obligation, entered into any transaction or acquired, encumbered or disposed of any property relating to the Business except in the ordinary course of business; or

(ii) been made aware of any anticipated loss from any contract which would be a Material Adverse Change;

(b) other than retention arrangements that would not become Assumed Liabilities, there has not been any salary increase or bonus made or promised for the benefit of any Employee, other than annual salary adjustments made in the ordinary course of business;

(c) there has not been a Material Adverse Change in the Business or the Purchased Assets; and

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(d) there has not been any undertaking arrangement, assurance or agreement by the Vendor to do any of the foregoing.

4.29 Conduct of Business in Accordance with Business Plan

Since January 1, 2015, the Vendor has made commercially reasonable efforts to operate the Business in accordance with its 2015 Canada Business Plan dated November 20, 2014, a copy of which is attached hereto as Schedule 4.29.

4.30 No Bankruptcy or Insolvency

The Vendor is neither an insolvent person nor has it committed an act of insolvency within the meaning of the Bankruptcy and Insolvency Act (Canada), nor has it taken any steps to have itself declared bankrupt or wound up, reorganized, or to have a receiver appointed over any of its assets.

4.31 Compliance With Privacy Laws

(a) The Vendor has collected, used, maintained, and disclosed Personal Information in connection with the Business in material compliance with Privacy Laws. Without limiting the foregoing, none of the disclosed Personal Information has been compiled through automatic information assembly or “data harvesting”.

(b) There are no investigations, actions, claims or demands, whether statutory or otherwise, pending, or to the knowledge of the Vendor, threatened, with respect to the collection, use, disclosure or retention of the Personal Information by the Vendor.

(c) No judgment or order, whether statutory or otherwise, is pending or has been made, and no notice has been given pursuant to any Privacy Laws, requiring the Vendor to take (or to refrain from taking) any action with respect to the Personal Information.

4.32 GST/HST Registration

The Vendor is a registrant for purposes of the ETA whose registration number is 10188 4138 RT0001.

4.33 Equity interests

Except as disclosed in Schedule 4.33, the Vendor does not own, either as registered or beneficial owner, shares or interests in any other Person.

4.34 Brokerage Fees

The Vendor has not entered into any agreement which would entitle any Person to any valid claim against the Vendor or the Purchaser for a brokers’ commission, finders’ fee or any like payment in respect of the purchase and sale of the Purchased Assets or any other matter contemplated by this Agreement.

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ARTICLE 5 - REPRESENTATIONS AND WARRANTIES
OF THE PURCHASER

The Purchaser represents and warrants to the Vendor as follows and acknowledges and confirms that the Vendor is relying on such representations and warranties in connection with its sale of the Business and the Purchased Assets.

5.1 Organization

(a) The Purchaser is a limited partnership existing under the laws of the Province of Ontario and has the corporate power to enter into this Agreement and to perform its obligations hereunder.

(b) HDMC is a corporation existing under the laws of the State of Wisconsin and has the corporate power to enter into this Agreement and to perform its obligations hereunder.

5.2 Authorization

(a) All necessary corporate action has been taken by the Purchaser to authorize the execution and delivery by it of, and the performance of its obligations under, this Agreement. This Agreement has been duly executed and delivered by the Purchaser. This Agreement is a legal, valid and binding obligation of the Purchaser, enforceable against the Purchaser by the Vendor in accordance with its terms, except as enforcement may be limited by bankruptcy, insolvency and other laws affecting the rights of creditors generally and except that equitable remedies may only be granted in the discretion of a court of competent jurisdiction.

(b) All necessary corporate action has been taken by HDMC to authorize the execution and delivery by it of, and the performance of its obligations under, this Agreement. This Agreement has been duly executed and delivered by HDMC. This Agreement is a legal, valid and binding obligation of HDMC, enforceable against HDMC by the Vendor in accordance with its terms, except as enforcement may be limited by bankruptcy, insolvency and other laws affecting the rights of creditors generally and except that equitable remedies may only be granted in the discretion of a court of competent jurisdiction.

5.3 No Violation

The execution and delivery of this Agreement by each of the Purchaser and HDMC and the consummation of the transactions herein provided for will not result in a material breach or violation of any of the provisions of, or constitute a material default under, or materially conflict with or cause the acceleration of any obligation of the Purchaser or HDMC under: (i) any material contract or agreement to which the Purchaser or HDMC is a party or by which it is or its properties are bound; (ii) any provision of the constating documents, partnership agreement or by-laws or resolutions of the board of directors (or any committee thereof) or the shareholders of the Purchaser or HDMC; (iii) any material judgment, decree, order, award, law, statute, ordinance, regulation, rule or by-law of any Authority having jurisdiction over the Purchaser or HDMC, except where

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such breach, violation, default, conflict or acceleration would not prevent the Purchaser from fulfilling its obligations under this Agreement.

5.4 Consents and Approvals

Except as specified under the Investment Canada Act and the Competition Act, there is no requirement for the Purchaser or HDMC to make any filing with, give any notice to or obtain from any Authority any licence, permit, approval, consent, registration, certificate or other regulatory authorization as a condition to the lawful consummation of the transactions contemplated by this Agreement. There is no requirement under any contract or agreement to which the Purchaser or HDMC is a party or by which it is bound to give any notice to, or to obtain the consent or approval of, any party to such contract or agreement relating to the consummation of the transactions contemplated by this Agreement, the failure of which to obtain would prevent the Purchaser or HDMC from fulfilling its obligations under this Agreement.

5.5 GST/HST Registration

The Purchaser is a registrant for purposes of the ETA whose registration number is 802372383 RT0001.

5.6 Brokerage Fees

Neither the Purchaser nor HDMC has entered into any agreement which would entitle any person to any valid claim against the Purchaser, HDMC or the Vendor for a brokers’ commission, finders’ fee or any like payment in respect of the purchase and sale of the Purchased Assets or any other matter contemplated by this Agreement.

5.7 No Bankruptcy or Insolvency

Neither the Purchaser nor HDMC is an insolvent person nor has it committed an act of insolvency within the meaning of the Bankruptcy and Insolvency Act (Canada) or any analogous legislation in any other jurisdiction, nor has it taken any steps to have itself declared bankrupt or wound up, reorganized, or to have a receiver appointed over any of its assets.

ARTICLE 6 - SURVIVAL OF COVENANTS,
REPRESENTATIONS AND WARRANTIES

6.1 Survival of Representations and Warranties of the Vendor

The representations and warranties of the Vendor contained in Article 4 or any certificate delivered pursuant to this Agreement shall survive the Closing for a period of eighteen (18) months from the Closing Date, except for:

(a) those matters set out in Sections 4.1 (Organization), 4.2 (Authorization and Enforceability), 4.5 (No Violation), 4.9 (Title to Personal and Other Property) and 4.10 (No other Agreement to Purchase) (the “Fundamental Representations”) which shall survive the Closing Date indefinitely;

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(b) those matters set out in Section 4.17 (Computer Systems) which shall survive the Closing for a period of two (2) years from the Closing Date;

(c) those matters set out in Section 4.20 (Environmental) which shall survive the Closing for a period of three (3) years from the Closing Date;

(d) the Vendor's representations and warranties set out in Sections 4.3 and 4.4 shall survive until the Tax Authorities shall no longer be entitled to assess or reassess liability for the applicable Taxes against the Vendor for that particular period, having regard, without limitation to any waivers given by the Vendor in respect of any taxation year; and

(e) fraudulent or willfully false representations and warranties which shall survive indefinitely,

and notwithstanding the Closing and, subject to any other terms and conditions of this Agreement, any inspection or inquiries made by or on behalf of the Purchaser, shall continue in full force and effect for the benefit of the Purchaser, after which time the Vendor shall be released from all obligations in respect of such representations and warranties except with respect to any Claims asserted by the Purchaser in accordance with Section 11.3 hereof before the expiration, if applicable, of such period.

6.2 Survival of the Representations and Warranties of the Purchaser and HDMC

The representations and warranties of the Purchaser and HDMC contained in this Agreement shall survive the closing of the transactions contemplated herein until the day that is eighteen (18) monthsfollowingthe Closing Date, and notwithstanding the Closing and any inspection or inquiries made by or on behalf of the Vendor, shall continue in full force and effect for the benefit of the Vendor, after which time the Purchaser and HDMC shall be released from all obligations in respect of such representations and warranties except with respect to any Claims asserted by the Vendor in accordance with Section 11.3 hereof before the expiration of such period.

6.3 Survival of Covenants

To the extent that they were not required to be or have not been fully performed at or prior to the Time of Closing, and have not been waived, if applicable, the covenants of the Vendor and the Purchaser contained in this Agreement and any document executed or delivered by any party hereto shall survive the Closing of the transactions contemplated herein in accordance with their respective terms.

ARTICLE 7 - INTERIM PERIOD

7.1 Conduct of Business Prior to Closing

Except as set out in the other sections of this Article 7, during the Interim Period, the Vendor will:

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(a) Use its commercially reasonable efforts to operate the Business only in the ordinary course, and, to the extent consistent with such past practice, use its commercially reasonable efforts to preserve its assets and business organization and its business relationships with clients, customers, suppliers and others having business dealings with it and the Vendor shall not, without the prior written consent of the Purchaser (which consent shall not be unreasonably withheld), (i) enter into any transaction and shall refrain from doing any action which, if effected before the date of this Agreement, would constitute a breach of any representation, warranty, covenant or other obligation of the Vendor contained herein; (ii) sell, lease or grant any option to sell or lease, give a security interest in or otherwise create any Encumbrance on any of the material assets of the Vendor, (iii) make any individual commitment or agreement for capital expenditures in excess of Cdn.$50,000, or (iv) sell, license or transfer any Intellectual Property;

(b) not incur any material indebtedness or Liability or make any payment in respect thereof, except in the ordinary course of the Business which: (i) includes advances for working capital purposes from Persons who are not dealing at arm’s length with the Vendor and the repayment thereof by the Vendor, and (ii) excludes any other indebtedness or Liability incurred by the Vendor in favour of Persons who are not dealing at arm’s length with the Vendor;

(c) not acquire or agree to acquire any material additional assets except: (i) supplies to the extent necessary to supplement material deficiencies and purchased in the ordinary course of the Business, (ii) equipment purchased in connection with the repair and maintenance of existing equipment, provided that the cost of such new equipment does not exceed Cdn.$50,000 in the aggregate, or (iii) with the prior written approval of the Purchaser, not to be unreasonably withheld or delayed;

(d) not sell, agree to sell or otherwise transfer or dispose of any of the material assets of the Vendor other than in the ordinary course of the Business or with the prior written approval of the Purchaser, not to be unreasonably withheld or delayed;

(e) not enter into any material forward commitment other than in the ordinary course of the Business without the prior approval of the Purchaser, not to be unreasonably withheld or delayed;

(f) not increase the wages or salaries or any other form of remuneration, direct or indirect, of any of the Employees without the prior approval of the Purchaser in its sole discretion;

(g) pay, satisfy and discharge its liabilities in the ordinary course of Business;

(h) not renew, extend, replace, renegotiate, amend or terminate any material Assumed Contract without the prior approval of the Purchaser, not to be unreasonably withheld or delayed, except in the case of an Assumed Contract that is extended or renewed automatically in accordance with its terms;

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(i) not renew, extend, replace, renegotiate or terminate any Dealer Agreement or enter into any new Dealer Agreement, other than those Dealer Agreements in the process of being renewed, extended, replaced, renegotiated or terminated as of the date hereof as disclosed in Schedule 1.1(ff) (which transactions are hereby consented to and approved by HDMC), without the prior approval of the Purchaser, in its sole discretion;

(j) maintain the insurance currently held by the Vendor in respect of the Business and the Real Property in the same manner as currently held by the Vendor on the date hereof and as disclosed in Schedule 4.19;

(k) pay as and when due in accordance with Applicable Laws any and all Taxes capable of causing an Encumbrance of any nature on the Purchased Assets;

(l) promptly advise the Purchaser in writing of any Material Adverse Change, financial or otherwise, in the Vendor, the Business or their respective assets and properties;

(m) in reasonable consultation with the Purchaser, use all commercially reasonable efforts to give or obtain the contractual waivers, notices, consents, subordination agreements, attornment agreements, acknowledgments and approvals required to consummate the transactions contemplated herein;

(n) not, directly or indirectly, do or permit to occur any of the following: (i) adopt a plan of liquidation or resolutions providing for the liquidation or dissolution of the Vendor; (ii) authorize, recommend, propose or agree to any release or relinquishment of any material contractual right under any of the Assumed Contracts or other material right under any governmental authorization of the Vendor; or (iii) waive, release, grant or transfer any rights of value or modify or change in any material respect any existing governmental authorization, in each case without the prior approval of the Purchaser, acting reasonably; and

(o) not, directly or indirectly, (i) solicit or consider any inquiries, proposals or offers, or enter into agreements, relating to the disposition of the Purchased Assets, the merger or consolidation of the Vendor with any Person, the sale or exchange of any securities of the Vendor, or any other business combination involving the Vendor, or (ii) divulge or otherwise disclose any confidential information concerning the Business or the assets of the Business to any third Person or any details regarding the terms of this Agreement, in each case without the prior approval of the Purchaser, acting reasonably.

7.2 Conduct of Business in Accordance with Marketing Plan

During the Interim Period, the Vendor will use its commercially reasonable efforts to operate the Business in accordance with its 2015 Canada Business Plan dated November 20, 2014, and adhere to the Vendor’s 2015 model sales policies adopted thereafter, copies of such documents being attached hereto collectively as Schedule 4.29.

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7.3 Material Performance of Distributorship Agreement

Subject to Section 7.9 or as otherwise provided in this Agreement, during the Interim Period, the Vendor will use its commercially reasonable efforts to perform its obligations under the Distributorship Agreement in all material respects and on a timely basis.

7.4 Motorcycle Target

For the period from January 1, 2015 to the Closing Date, the Vendor shall achieve aggregate Dealer retail sales of Harley-Davidson motorcycles in Canada of 8,084 units (the “Motorcycle Target”).

7.5 Non-Current Inventory Target

For the period from January 1, 2015 to the Closing Date, the Vendor shall achieve aggregate Dealer retail sales of non-current Harley-Davidson motorcycles in Canada (being all model years prior to 2015) in Canada of 1,531 units (the “Non-Current Model Target”).

7.6 PAM Target

From the date of this Agreement to the Closing Date, the Vendor shall achieve CIM Platinum Performance as defined in HDMC’s CIM system, as follows:

(a) fifty-six percent (56%) of Users (as defined in the CIM system) in May 2015 (the “May PAM Target”);

(b) fifty-seven percent (57%) of Users in June 2015 (the “June PAM Target”); and

(c) forty-eight percent (48%) of Users in July 2015 (the “July PAM Target”).

7.7 Maintenance of Current Pricing

During the Interim Period, the Vendor will maintain current Canadian dollar pricing offered by the Vendor to the Dealers for all motorcycle models and PAM Inventory, unless otherwise consented to in advance in writing by the Purchaser.

7.8 Access for Investigation

(a) During the Interim Period, the Vendor will permit the Purchaser and its employees, agents, counsel, accountants and other representatives to have access during normal business hours to the premises of the Vendor, and to all Books and Records and will furnish to the Purchaser any information included in the Books and Records as the Purchaser may from time to time reasonably request to enable it to make a full and complete investigation of the Business and the Purchased Assets, and the Vendor will instruct its officers, employees, solicitors, accountants and other advisors to cooperate fully with and assist the Purchaser in that investigation. Notwithstanding the foregoing, the Vendor shall not be required to provide any personnel records or other records relating to its Employees to the Purchaser prior to the Closing Date,

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and the above referenced access and investigation shall not unduly interfere with the operation of the Vendor’s business.

(b) Until the Closing Date, in the event that the Purchaser desires to investigate the Vendor’s operations, the Purchaser and the Vendor shall, acting reasonably, agree on the date and time of such investigation and the scheduling of any meetings with the Vendor’s personnel and shall cause its personnel to cooperate with the Purchaser in connection with its reasonable investigations and information requests, provided that any such visits shall not cause any undue interruption to the operation and conduct of the Business. The Purchaser covenants and agrees with the Vendor that it will not request, directly or indirectly, physical inspection of the Vendor’s operation by governmental Authorities without the consent of the Vendor.

(c) If in the course of the Purchaser’s investigations of the Vendor’s operations during the Interim Period, the Purchaser reasonably apprehends a breach of a representation or warranty by the Vendor, the Purchaser shall notify the Vendor and the Vendor shall use it best efforts to resolve such breach or mitigate any damages or negative effects caused by such breach.

7.9 Performance under the Distributorship Agreement prior to Closing

HDMC hereby covenants and agrees not to require compliance with or enforce the following provisions of the Distributorship Agreement during the Interim Period:

(a) Article 12 – Business Planning Process;

(b) Section 14.2 – Succession Plan;

(c) Section 15.2 – Termination for Cause (except for subsections 15.2.4, 15.2.8, 15.2.9, and 15.2.11); and

(d) Section 15.3 – Conversion of Distributor’s Appointment.

HDMC further acknowledges that all provisions of the Distributorship Agreement and the obligations of the Vendor and the commercially reasonable standard of performance thereunder shall be interpreted in consideration of the pending termination of the Distributorship Agreement on Closing.

7.10 Obtaining All Authorizations

(a) Each of the Vendor and the Purchaser, as promptly as practicable after the execution of this Agreement, shall use its commercially reasonable efforts to make all filings with, give all notices to, and obtain all authorizations from, governmental Authorities that are necessary for the lawful completion of the transactions contemplated by this Agreement.

(b) In the case of the ICA Approval and the Competition Act Approval, each of Vendor and the Purchaser shall make, or cause to be made, all filings and submissions, and

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submit all documentation and information that is required to obtain the ICA Approval and the Competition Act Approval, and will use its commercially reasonable efforts to satisfy all requests for additional information and documentation received under or pursuant to those filings, submissions and the applicable legislation and any orders or requests made by any governmental Authorities under such legislation. The Purchaser shall use its commercially reasonable efforts to obtain ICA Approval and Competition Act Approval, including, in respect to ICA Approval only, by offering and agreeing to undertakings that are satisfactory to the Purchaser acting reasonably.

(c) The Parties will coordinate and cooperate in exchanging information and supplying assistance that is reasonably requested in connection with this Section 7.10 including providing each other with advanced copies and reasonable opportunity to comment on all notices and information supplied to or filed with any governmental Authority (including notices and information which a Party, acting reasonably, considers highly confidential and sensitive which may be provided on a confidential and privileged basis to outside counsel of the other Party), and all notices and correspondence received from any governmental Authority. To the extent that any information or documentation to be provided by the Vendor to the Purchaser pursuant to this Section 7.10 is competitively sensitive, such information may be provided only to external counsel for the Purchaser on an external counsel only basis.

7.11 Wind-up of HOG

Notwithstanding anything else in this Agreement, the Vendor and the Purchaser acknowledge and agree that HOG may be wound-up during the Interim Period, with all of its assets and liabilities being conveyed to and assumed by the Vendor.

ARTICLE 8 - OTHER COVENANTS

8.1 Regulatory Approvals

The Vendor shall cooperate with the Purchaser and render all necessary and reasonable assistance required by the Purchaser in connection with any application, notification or filing of the Purchaser in connection with these transactions or for the purposes of obtaining any permit, including Environmental Permits, necessary to allow the Purchaser to operate the Business following the Closing Date, including the notices, consents and approvals described in Schedule 4.6(a).

8.2 Consents and Approvals

The Vendor shall use its reasonable commercial efforts to give or obtain, at the Vendor’s own expense, at or prior to the Time of Closing, the notices, consents and approvals described in Schedule 4.6(b). Any filing fees with respect to the Competition Act Approval shall be paid wholly by the Purchaser.

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8.3 Bulk Sales Waiver

The parties agree to waive compliance with the provisions of bulk sales legislation in the jurisdictions in which any of the Purchased Assets are located. The Vendor shall (to the extent that such debts do not comprise part of the Assumed Liabilities), within ten (10) Business Days following the Closing, pay to its creditors all debts due, owing, payable or accruing due or to become due to its creditors as of the Closing Date, and deliver a certificate from the chief executive officer of the Vendor certifying to the Purchaser that all of such debts have been paid. The Escrow Amount shall not be distributed in accordance with the terms of the Escrow Agreement until such certificate is delivered by the Vendor. The Vendor covenants and agrees to take all action necessary to prevent any of its creditors from asserting any claim against the Purchaser or the Purchased Assets or under any bulk sales legislation for relief provided therein as a result of non-compliance with such legislation.

8.4 Escrow Agreement

At the Time of Closing, a portion of the Purchase Price amounting to $1,500,000shall be delivered into escrow as security for the performance of its representations, warranties and covenants under this Agreement. Without limiting the foregoing, at the Time of Closing, the Vendor and the Purchaser shall each execute and deliver the Escrow Agreement, and shall perform their respective obligations thereunder in accordance with its terms, and shall use their respective best efforts to cause the Escrow Agent to execute and deliver the Escrow Agreement. HDMC and the Purchaser each acknowledges and agrees that any and all costs relating to the escrow arrangements, including the Escrow Agent’s fees and the Vendor’s legal fees relating to reviewing and settling the Escrow Agreement, shall be payable by HDMC and shall not reduce the amount being held in escrow.

8.5 Concord Lease

At the Time of Closing, the Vendor shall terminate its existing lease of the Concord Property, the Purchaser shall execute and deliver the Concord Lease, and the Vendor shall cause the landlord of the Concord Property to execute and deliver the Concord Lease.

8.6 Richmond Occupancy License

At the Time of Closing, the Vendor and the Purchaser shall execute and deliver the Richmond Occupancy License, and the Vendor shall use commercially reasonable efforts to have the landlord of the Richmond Property provide any required consent relating thereto.

8.7 Non-Competition Agreements

At the Time of Closing, the Vendor, Don James and Malcolm Hunter shall enter into non-competition agreements with the Purchaser and HDMC in substantially the form attached as Exhibit E. Without limiting the foregoing, at the Time of Closing, the Vendor shall execute and deliver its Non-Competition Agreement, and shall deliver the executed Non-Competition Agreements of Don James and Malcolm Hunter.

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8.8 Transitional Services Agreement

The Vendor shall, for a period of up to six (6) months following the Closing Date, provide the Purchaser with such services as it may reasonably require with respect to the data centre operated by the Vendor from the Richmond Property in accordance with the terms of the Transitional Services Agreement. Without limiting the foregoing, at the Time of Closing, the Vendor and the Purchaser shall execute and deliver the Transitional Services Agreement.

8.9 HDFS Discharge

At or before the Time of Closing, the Vendor shall repay any and all amounts owing by it to HDFS Canada and shall cause Don James to tender his resignation with immediate effect of his position on the board of directors of HDFS Canada.

8.10 Dealer Network Relationships

The Vendor covenants and agrees to use commercially reasonable efforts to assist the Purchaser with respect to communications with the Dealers regarding the transactions contemplated in this Agreement and the impact of such transactions on each Dealer; and without limiting the generality of the foregoing to promptly organize “town hall” meetings with such Dealers to permit the Purchaser to efficiently communicate its transition plans to the Dealers. The costs of such town hall meetings shall be divided equally between the Purchaser and the Vendor. The Vendor shall take such steps as the Purchaser may reasonably direct, at the expense of the Purchaser, to minimize any disruption of the Purchaser’s current and prospective relationships with the Dealers. The Purchaser agrees that, as soon as practicable following the date hereof (and in any event within twenty (20) Business Days of the date of this Agreement), it shall provide written offers (which offers shall include reasonable security terms to secure the payment by Dealers of product purchases from the Purchaser) of dealership agreements (the “New Dealer Agreements”) to all of the Dealers as of the Closing Date (including, for greater certainty, the Dealership Business). Subject to provisions related to early termination, the New Dealer Agreements shall have a five year term (the “Full Term”) for the majority of Dealers and, in every case, a term ending no earlier than December 31, 2016. The Purchaser agrees that, subject to the foregoing, it shall offer a New Dealer Agreement to the Dealership Business to continue to operate as a retailer of Harley-Davidson products on terms and conditions comparable to those being offered to other Full Term Dealers. The Purchaser covenants and agrees that the New Dealer Agreements shall be effective contemporaneously with the termination of the Dealer Agreements. The parties acknowledge and agree that the requirements of Section 16.4 of the Distributorship Agreement requiring the Vendor to cause each of its Dealers to, upon termination of the Dealer Agreement, immediately remove from its premises and discontinue all use of the Trademarks and all materials bearing any of the Trademarks (including signs) shall be waived with respect to each Dealer.

8.11 Delivery of Books and Records

At the Time of Closing the Vendor shall deliver to the Purchaser all of the Books and Records. The Purchaser agrees that it will maintain and preserve the Books and Records so delivered to it for a period of seven (7) years from the Closing Date, or for such longer period as is required by

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any Applicable Law, and will permit the Vendor or its authorized representatives reasonable access thereto in connection with their affairs relating to its matters.

8.12 Litigation Support

(a) Subject to Article 11, which the parties acknowledge shall apply exclusively to any legal proceeding to which the Vendor is a party on or following the Closing in relation to the Business (a “Vendor Proceeding”) in which a claim for indemnification has been made, each of the Purchaser and HDMC agrees to provide to the Vendor, as soon as practicable, and on an ongoing basis, all information reasonably determined by the Vendor to be necessary or beneficial to it in connection with the Vendor Proceeding.

(b) To the extent that the Vendor requires the assistance of any employee of the Purchaser or HDMC in connection with the Vendor Proceeding, the Purchaser or HDMC, as applicable, shall provide the Vendor with access to such employee during normal business hours and the Vendor will use its commercially reasonable efforts to do so without undue interference to the business operations of the Purchaser.

(c) Each of the Purchaser and HDMC acknowledges and agrees that the Vendor shall retain full and complete carriage of and control over any such Vendor Proceeding, other than any control the Purchaser may have with regard to indemnified matters pursuant to Article 11 hereof.

(d) Any costs and expenses reasonably incurred by the Purchaser in providing information or access to its employees pursuant to the terms of this Section 8.12, including any out-of-pocket expenses and a reasonable reimbursement of employee wages, shall be reimbursed in full by the Vendor within thirty (30) days of receipt of an invoice from the Purchaser setting out the amount of such costs and expenses.

8.13 Employee Matters

(a) Prior to the Closing Date, the Vendor agrees to provide the Purchaser with an up-to-date list of the names of the Employees upon the request of the Purchaser from time to time and not more than four (4) Business Days following any such request.

(b) No later than two (2) Business Days after the commencement of the Interim Period, the Vendor shall give notice of termination of employment to all Employees, such termination to be effective upon and conditional upon Closing.

(c) With respect to the proposed hiring of Employees by the Purchaser, the Vendor and Purchaser agree as follows:

(i) By no later than thirty-five (35) days following the commencement of the Interim Period, the Purchaser shall interview and substantially complete initial offers of employment to such Employees as it chooses (the “Offered Employees”); with the offer of employment to be on such terms and conditions as the Purchaser may determine (the “Offer”).

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(ii) The Vendor shall render all reasonable assistance to encourage each Offered Employee to accept the Offer.

(iii) Offered Employees who accept the Offer shall be referred to hereinafter as the “Hired Employees”.

(iv) The Purchaser shall recognize the past service of the Hired Employees with the Vendor and, if applicable, the Vendor’s predecessors for all purposes.

(d) The Vendor shall employ all of the Offered Employees until the Time of Closing except for any Employees who prior to the Time of Closing: (i) have their employment terminated for cause; (ii) have their employment terminated with the Purchaser’s consent, which consent shall not be unreasonably withheld; (iii) voluntarily resign; or (iv) retire.

(e) Except as otherwise provided in this Agreement, during the Interim Period, the Vendor shall not hire any employees or increase the wages of any Employees, or enter into any new agreements with any Employee, except as required by contract or Applicable Law, or with the written consent of the Purchaser.

(f) Within fifteen (15) Business Days following the Closing Date, the Vendor shall settle, and pay to each of the Employees, all salaries, commissions, bonuses, and other amounts that were earned or that may become payable to or receivable by such Employees for all periods ending on or before the Closing Date, including accrued vacation pay in respect of their employment with the Business or any predecessor of the Business, and including pro-rata bonuses for the portion of the current bonus year that the Employees worked for the Vendor prior to the Closing Date.

(g) The Purchaser shall indemnify the Vendor and hold it harmless in respect of Severance Costs payable by the Vendor to:

(i) Employees who are not Offered Employees;

(ii) Offered Employees who do not accept an Offer of comparable employment from the Purchaser, in which case, the indemnity shall be limited to minimum statutory requirements in respect of notice or termination pay, severance pay and benefits;

(iii) Offered Employees who do not accept an Offer from the Purchaser that is not comparable; and

(iv) Hired Employees who assert a claim against the Vendor in respect of any difference between the compensation and benefits available under the Offer and the compensation and benefits available to them with the Vendor as of the commencement of the Interim Period; it being understood and agreed that, in such case, the Purchaser’s indemnification obligation shall be limited to such difference over the applicable contractual or common law notice period.

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(h) Notwithstanding the foregoing, the Purchaser’s obligation to indemnify the Vendor pursuant to this Section 8.13 shall be subject to the following:

(i) such obligation shall be reduced by fifty percent (50%) of the amount by which the Severance Costs to the Employees would have been reduced had working termination notices been provided to the Employees on March 19, 2015 rather than the actual date of delivery of termination notices by the Vendor;

(ii) the Purchaser shall not indemnify the Vendor in respect of its obligations to Lawson Greer or Ann Vandrick under any retirement agreements;

(iii) the Vendor’s sole and exclusive obligation to provide Employees with their entitlement to pro-rata bonuses through the Closing Date in respect of the 2015 bonus year;

(iv) the Purchaser’s obligation to indemnify the Vendor pursuant to this Section 8.13, subject to the qualifications provided for above, shall be subject to the provisions of Article 11; and

(v) the Vendor shall take such steps as the Purchaser may reasonably direct to minimize any severance or related damages claims of the Employees.

(i) Effective as of the Closing Date, the Purchaser shall be solely responsible for, and shall indemnify the Vendor and hold it harmless from and against, all salaries, commissions, bonuses and other amounts payable to Hired Employees earned in relation to any period of employment with the Purchaser, and all Severance Costs claimed by any Hired Employees (including as against the Vendor).

(j) The Hired Employees shall cease to participate in, accrue benefits under or be covered by the Employee Plans as of the Closing Date. Effective on the Closing Date, the Purchaser shall establish employee plans (the “Purchaser Employee Plans”) which shall provide the Hired Employees with benefits as it determines in its discretion. As of the Closing Date, the Hired Employees shall commence participation in, accrue benefits under and be covered by the Purchaser Employee Plans.

(k) The Purchaser will ensure that evidence of insurability or pre-existing conditions and eligibility periods in respect of the Purchaser Employee Plans are waived, except to the extent that such conditions and eligibility periods would have applied to the Hired Employees under the Employee Plans. The Purchaser Employee Plans shall honour any deductible, co-payment, coinsurance, or eligible out-of-pocket expenses paid or incurred by the Hired Employees, including with respect to their covered dependants, under the applicable Employee Plans from the beginning of the current coverage period to the Closing Date, as though such amounts had been paid in accordance with the terms and conditions of the Purchaser Employee Plans.

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(l) The Purchaser Employee Plans shall recognize service of the Hired Employees as recognized under the applicable Employee Plans for eligibility and determination of benefits under the Purchaser Employee Plans.

(m) The Vendor agrees that it is responsible under the Employee Plans for any benefit related claims arising in respect of the Employees prior to the Closing Date, in accordance with the terms of such Employee Plans and Applicable Law. The Purchaser agrees that it is responsible for any benefit related claims arising in respect of the Hired Employees from and after the Closing Date in accordance with the terms of the Purchaser Employee Plans and Applicable Law. For greater certainty, the date on which a benefit claim arose will be:

(i) in the case of a death claim, the date of death;

(ii) in the case of extended health care benefits, including dental and medical treatments, the date of treatment;

(iii) in the case of a claim for drug or vision care benefits, the date the prescription is filled; and

(iv) in the case of a disability claim, the date of occurrence of an injury, the diagnosis of an illness, or any other event giving rise to such claim or series of related claims.

8.14 Non-Transferable and Non-Assignable Assets

To the extent that any of the Purchased Assets, or any claim, right or benefit arising under or resulting from such assets (collectively, the “Rights”) is not capable of being transferred without the approval, consent or waiver of any third Person, or if the transfer of a Right would constitute a breach of any obligation under, or a violation of, any agreement or any Applicable Law, unless the approval, consent or waiver of such third Person is obtained and remedies such breach or violation, then this Agreement shall not constitute an agreement to transfer such Rights unless and until such approval, consent or waiver has been obtained. After the Closing and until the earlier of July 31, 2017 and the date on which all such Rights are transferred to the Purchaser, the Vendor shall respectively:

(a) maintain its existence and hold the Rights as bare trustee and agent for the Purchaser;

(b) comply with the terms and provisions of the Rights as bare trustee and agent for the Purchaser at the Purchaser’s cost and for the Purchaser’s benefit;

(c) cooperate with the Purchaser in any reasonable and lawful arrangements designed to provide the benefits of such Rights to the Purchaser; and

(d) enforce, at the request of the Purchaser and at the expense and for the account of the Purchaser, any rights of the Vendor arising from such Rights against any third Person, including the right to elect to terminate any such rights in accordance with the terms of such rights upon the written direction of the Purchaser.

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In order that the full value of the Rights may be realized for the benefit of the Purchaser, the Vendor shall, at the request and at the Purchaser’s expense and under the direction of the Purchaser, in the name of the Vendor or otherwise as the Purchaser may specify, take all such action and do or cause to be done all such things as are, in the opinion of the Purchaser acting reasonably, necessary or proper in order that the obligations of the Vendor, under such Rights may be performed in such manner that the value of such Rights is preserved and enures to the benefit of the Purchaser, and that any moneys due and payable and to become due and payable to the Purchaser in and under the Rights are received by the Purchaser. The Vendor shall promptly pay to the Purchaser all moneys collected by or paid to it in respect of every such Right.

8.15 Personal Information

Each Party shall comply with Privacy Laws in the course of collecting, using and disclosing Personal Information. The Purchaser shall collect Personal Information prior to Closing only for purposes related to the transactions contemplated by this Agreement and as is necessary to determine whether to proceed with such transactions and, if the Purchaser does not elect to terminate this Agreement as provided herein, for the completion of such transactions. During the Interim Period, the Purchaser shall not disclose Personal Information to any Person other than to its Representatives who are evaluating and advising on the transactions contemplated by this Agreement and shall protect and safeguard (and cause its Representatives to protect and safeguard) the Personal Information against unauthorized collection, use or disclosure. If the Purchaser proceeds with the transactions contemplated by this Agreement, the Purchaser shall not, following the Closing, without the consent of the individuals to whom such Personal Information relates or as permitted or required by Applicable Law, use or disclose Personal Information:

(a) for purposes other than those for which such Personal Information was collected by the Vendor prior to the Closing; and

(b) which does not relate directly to the carrying on of the Business or to the carrying out of the purposes for which the transactions contemplated by this Agreement were implemented.

If the Purchaser proceeds with the transactions contemplated by this Agreement, the Purchaser shall, within a reasonable period of time after Closing, notify affected individuals of the transactions and that their Personal Information has been transferred to Purchaser. If the Vendor or the Purchaser terminates this Agreement as provided herein, the Purchaser shall promptly deliver to the Vendor all Personal Information in its possession or in the possession of any of its Representatives, including all copies, reproductions, summaries or extracts thereof.

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8.16 Use of “Deeley” Name

The Vendor covenants and agrees not to utilize the “Deeley” name for a period of ten (10) years following the Closing Date in association with power sport industry vehicles, with the exception of the use of the “Trev Deeley Motorcycles”, “Trev Deeley Foundation” and the “Deeley Exhibition” business names (and combinations or variations thereof), which names the Vendor is expressly permitted to use in connection with the Dealership Business and charitable and not-for-profit activities following the Closing Date. The Vendor further covenants and agrees to grant an exclusive, royalty-free license to the Purchaser to use the “Deeley” name for a period of ten (10) years following the Closing Date in association with power sport industry vehicles with the exception of the use of the “Trev Deeley Motorcycles”, “Trev Deeley Foundation” and the “Deeley Exhibition” business names (and combinations or variations thereof) pursuant to a license agreement between the Vendor and the Purchaser to be entered into at the Time of Closing, in the form attached hereto as Exhibit D (the “License Agreement”).

8.17 Customer Personal Information and CASL

The Vendor covenants and agrees that any data relating to the Vendor’s customers or prospective customers that is provided to the Purchaser on Closing will indicate whether that customer or prospective customer has provided express consent to receive CEMs from the Vendor for the purposes of CASL. An indication of express consent to receive CEMs from the Vendor shall mean, for consents obtained on or after July 1, 2014, that the express consent was obtained in the manner prescribed by CASL, and for consents obtained before July 1, 2014, that the express consent either: (i) was obtained in the manner prescribed by CASL; or (ii) constituted a valid express consent under Privacy Laws, and therefore is recognized as a consent compliant with CASL in accordance with a Regulatory Impact Analysis Statement available online (at http://fightspam.gc.ca/eic/site/030.nsf/eng/00271.html). The Vendor shall provide the Purchaser on Closing with all documentation and records it has retained evidencing such express consents and the Vendor’s CASL policy. The Vendor hereby confirms that it does not rely upon implied consent to send CEMs, and that the Vendor’s CASL policy that addresses reliance upon implied consent to send CEMs has not been utilized or applied by the Vendor as the Vendor has relied solely upon express consent to send CEMs. The Purchaser shall comply with CASL in respect of any CEMs sent based on the information provided by the Vendor.

8.18 Gift Card Program

The Vendor covenants and agrees to administer any and all outstanding gift cards under the Gift Card Program in the same manner as currently administered until such time as all obligations to the retail customers who have purchased gift cards under the Gift Card Program have been extinguished.

8.19 Infusion Hosting Services

On or before Closing with respect to the Infusion statement of work between the Vendor and Infusion Development Corp. (“Infusion”) whereby Infusion provides managed cloud hosting services for the Vendor’s UltraComm application (the “SOW”), the Vendor covenants and agrees to obtain and deliver to the Purchaser an acknowledgement and consent of Infusion consenting to

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the assignment to the Purchaser of the SOW and agreeing to a one (1) year extension of the term thereof commencing on the Closing Date on substantially the same terms and conditions, including, for greater certainty, pricing, as currently provided in the SOW.

ARTICLE 9 - CONDITIONS OF CLOSING

9.1 Conditions of Closing in Favour of the Purchaser

(a) The purchase and sale of the Business and the Purchased Assets is subject to the following terms and conditions for the exclusive benefit of the Purchaser, to be performed or fulfilled at or prior to the Time of Closing:

(i) Representations and Warranties. The representations and warranties of the Vendor contained in this Agreement or any certificate or other document delivered pursuant hereto shall be true and correct at the Time of Closing in all material respects with the same force and effect as if such representations and warranties were made at and as of such time, except for any such representations and warranties that refer to or are expressed to be made as of a specific date, including the date of this Agreement, in which case such representations shall be true and correct in all material respects as of such date, and all representations and warranties that are on their terms qualified by materiality shall be true and correct, and a certificate executed by the Vendor dated the Closing Date, to that effect shall have been delivered to the Purchaser;

(ii) Covenants. All of the terms, covenants and conditions of this Agreement to be complied with or performed by the Vendor at or before the Time of Closing shall have been complied with or performed in all material respects, and a certificate executed by a senior officer of the Vendor, dated the Closing Date, to that effect shall have been delivered to the Purchaser;

(iii) No Material Adverse Change. No Material Adverse Change shall have occurred during the Interim Period;

(iv) Regulatory Consents. There shall have been obtained from all appropriate Authorities such consents and approvals as are required to be obtained by the Vendor and the Purchaser to permit the change of ownership of the Purchased Assets contemplated hereby, including Competition Act Approval and ICA Approval and those other consents and approvals described in Schedule 4.6(a);

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(v) Infusion Hosting Services. With respect to the Infusion statement of work between the Vendor and Infusion Development Corp. (“Infusion”) whereby Infusion provides managed cloud hosting services for the Vendor’s UltraComm application (the “SOW”), the Vendor shall have obtained and delivered to the Purchaser an acknowledgement and consent of Infusion consenting to the assignment to the Purchaser of the SOW and agreeing to a one (1) year extension of the term thereof commencing on the Closing Date on substantially the same terms and conditions, including, for greater certainty, pricing, as currently provided in the SOW;

(vi) Required Contractual Consents. Other than those Contracts specifically contemplated in the Transitional Services Agreement, the Vendor shall have given or obtained those notices, consents and approvals described in Schedule 4.6(b) as the Purchaser reasonably considers to be material to the Business;

(vii) No Action or Proceeding. No legal or regulatory action or proceeding shall be pending or threatened by any person to enjoin, restrict or prohibit the purchase and sale of the Purchased Assets contemplated hereby or the performance of any party’s obligations in this Agreement;

(viii)Workplace Safety and Insurance. The Vendor shall provide a clearance certificate or other similar documentary evidence from the Workplace Safety and Insurance Board or similar authority in each jurisdiction where the Vendor carries on the Business certifying that there are no outstanding assessments, penalties, fines, levies, charges, surcharges or other amounts due or owing to those authorities;

(ix) Delivery of Conveyancing Documents. The Vendor shall deliver to the Purchaser all necessary deeds, conveyances, bills of sale, assurances, transfers, assignments and any other documentation reasonably required by the Purchaser to transfer the Purchased Assets to the Purchaser with a good title, free and clear of all Encumbrances;

(x) Closing Documents. Without limiting the generality of any other provision of this Section 9.1, the Purchaser shall have received at or before the Time of Closing sufficient duly executed original copies of the following:

(D) a certificate of an officer of the Vendor attaching:

(i) copies of the articles of incorporation of the Vendor;

(ii) certificate of status of the Vendor; and

(iii) copies of resolutions of the board of directors and shareholders of the Vendor, approving the transfer of the Purchased Assets and entry into this Agreement and the other agreements, documents and transactions contemplated under this Agreement, as applicable;

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(E) a certificate of an officer of the Vendor confirming the matters contemplated in Section 9.1(a) and confirming that all conditions under this Agreement in favour of the Vendor have been either fulfilled or waived;

(F) the Deeley-HDMC Agreement executed by the Vendor;

(G) if applicable, termination agreements, in respect of Harley-Davidson Terminated Agreements not terminated under the Deeley-HDMC Agreement, executed by the Vendor;

(H) the Escrow Agreement executed by the Vendor;

(I) release from the Vendor of all claims it might have against HDMC substantially in the form attached as Exhibit G;

(J) the Non-Competition Agreements executed by the Vendor, Don James and Malcolm Hunter;

(K) the Concord Lease executed by the landlord of the Concord Property;

(L) the Richmond Occupancy License executed by the Vendor;

(M) the License Agreement executed by the Vendor;

(N) the Transitional Services Agreement executed by the Vendor;

(O) if applicable, a general conveyance, in a form reasonably satisfactory to the Purchaser, executed by Harley Owners Group Canada Inc. for the purposes of transferring all of its assets to the Purchaser;

(P) an opinion from counsel to the Vendor dated the Closing Date confirming the matters warranted in subsections 4.1 (Organization) and 4.2(a) (Authorizations); and

(Q) if applicable, the elections provided for in Section 3.8 and 3.9.

(b) In case any condition, obligation or covenant of the Vendor to be performed prior to the Time of Closing shall not have been performed or fulfilled prior to such time, the Purchaser may terminate this Agreement by notice in writing to the Vendor and in such event the Purchaser shall be released from all obligations hereunder relating to this Agreement and unless the condition, obligation or covenant of the Vendor for the non-performance of which the Purchaser has rescinded this Agreement are reasonably capable of being performed or caused to be performed by the Vendor, then the Vendor shall also be released from all obligations hereunder relating to this Agreement; provided, however, that the Purchaser shall be entitled to waive compliance with any of such conditions, obligations or covenants in whole or in part if it sees fit to do so without prejudice to any of its rights of termination in the event

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of non-performance of any other condition, obligation or covenant in whole or in part. In case any condition, obligation or covenant of the Vendor to be performed prior to the Time of Closing shall not have been performed prior to such time, and if the non-performed condition, obligation or covenant of the Vendor were reasonably capable of being performed or caused to be performed by the Vendor, then:

(i) the Purchaser may terminate this Agreement by notice in writing to the Vendor and in such event the Purchaser shall be released from all obligations hereunder relating to this Agreement and the Purchaser’s rights to pursue legal remedies against the Vendor will survive such termination unimpaired; and

(ii) the Purchaser may elect to complete this Agreement by notice in writing to the Vendor and in such event the Purchaser shall be entitled to require the Vendor to complete the transaction with an abatement of the Purchase Price (the “Abatement”) equal to the aggregate of:

(A) in the event that the Vendor fails to achieve the Motorcycle Target as provided for in Section 7.4:

(i) if the Motorcycle Target is not achieved by an amount of units representing four percent (4%) or more but less than six percent (6%) of the Motorcycle Target, being between 324 and 484 units, the amount of One Thousand Seven Hundred and Fifty Dollars ($1,750) multiplied by the number of units by which the Motorcycle Target is not achieved; or

(ii) if the Motorcycle Target is not achieved by six percent (6%) or more of the Motorcycle Target, being 485 or more units, the amount of Two Thousand Dollars ($2,000) multiplied by the number of units by which the Motorcycle Target is not achieved to a maximum of One Million Two Hundred and Fifty Thousand Dollars ($1,250,000); and

(B) in the event that the Vendor fails to achieve the Non-Current Model Target as provided for in Section 7.5:

(i) if the Non-Current Model Target is not achieved by three percent (3%) or more but less than five percent (5%) of the Non-Current Model Target, being between 46 and 75 units, the amount of Two Thousand Five Hundred Dollars ($2,500) multiplied by the number of units by which the Non-Current Model Target is not achieved; or

(ii) if the Non-Current Model Target is not achieved by five percent (5%) or more of the Non-Current Model Target, being 76 or more units, the amount of Three Thousand Dollars

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($3,000) multiplied by the number of units by which the Non-Current Model Target is not achieved to a maximum amount of Five Hundred Thousand Dollars ($500,000); and

(C) in the event that the Vendor fails to achieve the May PAM Target as provided in Section  7.6:

(i) if 55% of Users or more, but less than 56% of Users, the amount of Twenty-Five Thousand Dollars ($25,000);

(ii) if 54% of Users or more, but less and 55% of Users, Fifty Thousand Dollars ($50,000); and

(iii) if less than 54% of Users, Seventy-Five Thousand Dollars ($75,000);

(D) in the event that the Vendor fails to achieve the June PAM Target as provided in Section  7.6:

(i) if 56% of Users or more, but less than 57% of Users, the amount of Twenty-Five Thousand Dollars ($25,000);

(ii) if 55% of Users or more, but less than 56% of Users, Fifty Thousand Dollars ($50,000); and

(iii) if less than 55% of Users, Seventy-Five Thousand Dollars ($75,000);

(E) in the event that the Vendor fails to achieve the July PAM Target as provided in Section  7.6:

(i) if 47% of Users or more, but less than 48% of Users, the amount of Thirty-Three Thousand Dollars ($33,000);

(ii) if 46% of Users or more, but less than 47% of Users, Sixty-Seven Thousand Dollars ($67,000); and

(iii) if less than 46% of Users, One Hundred Thousand Dollars ($100,000); and

(F) the amount of Twelve Million Dollars ($12,000,000) if the condition, obligation or covenant of the Vendor to be performed prior to the Time of Closing and not performed or fulfilled is the covenant set out in Section 7.7,

the parties acknowledging the Abatement to be a genuine pre-estimate of the damages that would be suffered by the Purchaser arising out of the unperformed or unfulfilled condition, obligation or covenant specified in the Vendor’s notice in writing

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(including the rights of the Purchaser pursuant to Article 11 and any other indemnification provisions of this Agreement) and the Purchaser shall have no right to pursue further legal remedies against the Vendor for any loss arising out of the unperformed or unfulfilled condition, obligation or covenant specified in the Purchaser’s notice in writing.

(c) For greater certainty, for the purposes of this Section, a condition shall be deemed reasonably capable of being performed or caused to be performed unless the circumstances giving rise to the non-performance could not reasonably have been anticipated at the date hereof and were beyond the reasonable control of the Vendor at the Time of Closing.

9.2 Conditions of Closing in Favour of the Vendor

(a) The purchase and sale of the Purchased Assets is subject to the following terms and conditions for the exclusive benefit of the Vendor, to be performed or fulfilled at or prior to the Time of Closing:

(i) Representations and Warranties. The representations and warranties of the Purchaser contained in this Agreement or any certificate or other document delivered pursuant hereto shall be true and correct in all material respects at the Time of Closing with the same force and effect as if such representations and warranties were made at and as of such time, and all representations and warranties that are on their terms qualified by materiality shall be true and correct, and a certificate executed by the Purchaser, dated the Closing Date, to that effect shall have been delivered to the Vendor;

(ii) Covenants. All of the terms, covenants and conditions of this Agreement to be complied with or performed by the Purchaser at or before the Time of Closing shall have been complied with or performed in all material respects, and a certificate executed by a senior officer of the Purchaser, dated the Closing Date, to that effect shall have been delivered to the Vendor;

(iii) No Action or Proceeding. No legal or regulatory action or proceeding shall be pending or threatened by any person to enjoin, restrict or prohibit the purchase and sale of the Purchased Assets contemplated hereby or the performance of any party’s obligations under any agreement contemplated in this Agreement to be executed and delivered by either party at the Time of Closing; and

(iv) Closing Documents. Without limiting the generality of any other provision of this Section 9.2, the Vendor shall have received at or before the Time of Closing sufficient duly executed original copies of the following:

(A) a certificate of an officer of Harley-Davidson Canada GP Inc. (the “GP”), on behalf of the GP and as general partner of the Purchaser attaching:

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(i) copies of the articles of incorporation of the GP;

(ii) a copy of the declaration of the Purchaser;

(iii) a copy of the Purchaser’s limited partnership agreement;

(iv) certificate of status of the Purchaser; and

(v) copies of resolutions of the board of directors and shareholder of the GP, as general partner of the Purchaser, approving the transfer of the Purchased Assets and entry into this Agreement and the other agreements, documents and transactions contemplated under this Agreement, as applicable; and

(B) a certificate of an officer of the GP, as general partner of the Purchaser, confirming the matters contemplated in Section 9.2(a) and confirming that all conditions under this Agreement in favour of the Vendor have been either fulfilled or waived;

(C) the Escrow Agreement executed by the Purchaser and the Escrow Agent;

(D) release from HDMC and its Affiliates of all claims such entities might have against the Vendor substantially in the form attached as Exhibit H;

(E) the Concord Lease executed by the Purchaser and the related indemnity executed by HDMC;

(F) the Richmond Occupancy License executed by the Purchaser;

(G) the License Agreement executed by the Purchaser;

(H) the Deeley-HDMC Agreement executed by HDMC;

(I) if applicable, termination agreements, in respect of Harley-Davidson Terminated Agreements not terminated under the Deeley-HDMC Agreement, executed by HDMC or its applicable Affiliates;

(J) the Transitional Services Agreement executed by the Purchaser; and

(K) if applicable, the elections provided for in Section 3.8 and 3.9.

(b) In case any condition, obligation or covenant of the Purchaser to be performed prior to the Time of Closing shall not have been performed or fulfilled prior to such time, the Vendor may terminate this Agreement by notice in writing to the Purchaser and in such event the Vendor shall be released from all obligations hereunder relating to this Agreement and unless the condition, obligation or covenant of the Purchaser for the non-performance of which the Vendor has rescinded this Agreement are

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reasonably capable of being performed or caused to be performed by the Purchaser, then the Purchaser shall also be released from all obligations hereunder relating to this Agreement, subject to Section 9.2(c); provided, however, that the Vendor shall be entitled to waive compliance with any of such conditions, obligations or covenants in whole or in part if it sees fit to do so without prejudice to any of its rights of termination in the event of non-performance of any other condition, obligation or covenant in whole or in part.

(c) If the Purchaser terminates this Agreement by notice in writing to the Vendor and the transaction contemplated by this Agreement is not completed solely at the Purchaser’s election and not because a condition, obligation or covenant of the Vendor to be performed prior to the Time of Closing shall not have been performed or fulfilled prior to such time, the Purchaser will pay to the Vendor an amount equal to Two Million Dollars ($2,000,000)(the “Break Up Fee”), the parties acknowledging the Break Up Fee to be a genuine pre-estimate of the damages that would be suffered by the Vendor in such circumstances, and in full satisfaction thereof (including the rights of the Vendor pursuant to Article 11 and any other indemnification provisions of this Agreement). For greater certainty and without limiting the foregoing, this Section 9.2(c) shall expressly apply, without limitation, to termination by the Vendor in accordance with Section 9.2(b).

(d) For greater certainty, for the purposes of this Section, a condition shall be deemed reasonably capable of being performed or caused to be performed unless the circumstances giving rise to the non-performance could not reasonably have been anticipated at the date hereof and were beyond the reasonable control of the Purchaser at the Time of Closing.

9.3 Survival of Disclosure Provisions

Notwithstanding any other provision of this Agreement, the obligations contained in Sections 12.2 and 12.3 and any confidentiality agreement entered into by the parties shall survive the early termination of this Agreement.

ARTICLE 10 - CLOSING DATE AND TRANSFER OF POSSESSION

10.1 Place of Closing

The closing of the purchase and sale of the Purchased Assets (the “Closing”) shall take place at the Time of Closing at the offices of Miller Thomson LLP, 58^th Floor, Scotia Plaza, 40 King Street West, Toronto, Ontario M5H 3S1.

10.2 Further Assurances

From time to time subsequent to the Closing Date, each party to this Agreement covenants and agrees that it will at all times after such date, at the expense of the requesting party, promptly execute and deliver all such documents, including all such additional conveyances, transfers, consents and other assurances and do all such other acts and things as the other party, acting

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reasonably, may from time to time request be executed or done in order to better evidence or perfect or effectuate any provision of this Agreement or of any agreement or other document executed pursuant to this Agreement or any of the respective obligations intended to be created hereby or thereby.

ARTICLE 11 - REMEDIES

11.1 Indemnification by the Vendor

Subject to the terms set forth in this Article 11, the Vendor agrees to indemnify and save harmless the Purchaser, its Affiliates, and their respective directors, officers, agents, employees and shareholders (collectively referred to as the “Purchaser Indemnified Parties”) from and against any or all Losses suffered or incurred by the Purchaser Indemnified Parties as a result of:

(a) any breach by the Vendor of any representation or warranty of the Vendor contained in this Agreement;

(b) any breach or non-performance by the Vendor of any covenant to be performed by it which is contained in this Agreement;

(c) any Excluded Assets or any failure by the Vendor to pay, satisfy, discharge, perform or fulfil any of the Excluded Liabilities; and

(d) any claim arising out of the Bulk Sales Act (Ontario) or any non-compliance by the Vendor with Section 6 of the Retail Sales Tax Act (Ontario), except to the extent that such claim relates to the Assumed Liabilities.

Notwithstanding the foregoing, the Vendor shall not be required to indemnify or save harmless the Purchaser Indemnified Parties in respect of any Loss referred to in Section 11.1(a) or Section 11.1(b) unless a Purchaser Indemnified Party shall have provided notice to the Vendor in accordance with Section 11.3 on or prior to the expiration of the applicable time period related to such representation or warranty set out in Section 6.1 or such covenant set out in Section 6.3.

11.2 Indemnification by the Purchaser

Subject to the terms set forth in this Article 11, the Purchaser agrees to indemnify and save harmless the Vendor, its Affiliates, and their respective directors, officers, agents, employees and shareholders (collectively referred to as the “Vendor Indemnified Parties”) from and against any or all Losses suffered or incurred by the Vendor Indemnified Parties as a result of:

(a) any breach by the Purchaser of any representation or warranty contained in this Agreement;

(b) any breach or non-performance by the Purchaser of any covenant to be performed by it which is contained in this Agreement; and

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(c) any failure by the Purchaser to pay, satisfy, discharge, perform or fulfil any of the Assumed Liabilities or any liabilities and obligations of the Business as operated by the Purchaser after Closing.

Notwithstanding the foregoing, the Purchaser shall not be required to indemnify or save harmless the Vendor Indemnified Parties in respect of any Loss referred to in Section 11.2(a) or Section 11.2(b), unless a Vendor Indemnified Party shall have provided notice to the Purchaser in accordance with Section 11.3 on or prior to the expiration of the applicable time period related to such representation or warranty set out in Section 6.2 or such covenant set out in Section 6.3.

11.3 Notice of Claim

In the event that a person entitled to indemnification hereunder (the “Indemnified Party”) shall become aware of any claim, proceeding or other matter (a “Claim”) in respect of which a party (the “Indemnifying Party”) has agreed to indemnify the Indemnified Party pursuant to this Agreement, the Indemnified Party shall promptly give written notice thereof to the Indemnifying Party. Such notice shall specify whether the Claim arises as a result of a claim by a person against the Indemnified Party (a “Third Party Claim”) or whether the Claim does not so arise (a “Direct Claim”), and shall also specify with reasonable particularity (to the extent that the information is available), the factual basis for the Claim and the amount of the Claim, if known. If, through the fault of the Indemnified Party, the Indemnifying Party does not receive notice of any Claim in time effectively to contest the determination of any liability susceptible of being contested, the Indemnifying Party shall be entitled to set off against the amount claimed by the Indemnified Party the amount of any Losses incurred by the Indemnifying Party resulting from the Indemnified Party’s failure to give such notice on a timely basis. Notwithstanding the foregoing, an Indemnified party shall provide notice of any Claim relating to Taxes no later than 30 days after the assessment or reassessment of such Taxes.

11.4 Direct Claims

(a) With respect to any Direct Claim, following receipt of notice from the Indemnified Party of the Claim, the Indemnifying Party shall have twenty (20) Business Days (for the purposes of this Section, the “Investigation Period”) to make such investigation of the Claim as is considered necessary or desirable. For the purpose of such investigation, the Indemnified Party shall make available to the Indemnifying Party the information relied upon by the Indemnified Party to substantiate the Claim, together with all such other information as the Indemnifying Party may reasonably request. If both parties agree at or prior to the expiration of the Investigation Period (or any mutually agreed upon extension thereof) to the validity and amount of such Claim, the Indemnifying Party shall immediately pay to the Indemnified Party the full agreed upon amount of the Claim. If the parties are unable to resolve the dispute within a reasonable time of such written request, and in any event prior to the expiration of the Investigation Period (or any mutually agreed upon extension thereof), the dispute shall, at the request of either party, be determined by a court of competent jurisdiction.

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(b) In connection with a Direct Claim arising out of a breach by the Vendor of its representation and warranty contained in Section 4.7, during the Investigation Period, the parties shall investigate the Claim for the purposes of making a determination as to whether or not any uncollected Accounts Receivable are in fact ultimately collectible. A Direct Claim in respect of such matter shall only be deemed to be valid to the extent that there is not a substantial likelihood that such Accounts Receivable are collectible through reasonable commercial efforts. If the parties are unable to resolve the dispute within a reasonable time, and in any event prior to the expiration of the Investigation Period (or any mutually agreed upon extension thereof), the dispute shall, at the request of either party, be submitted to PriceWaterhouseCoopers, Toronto (the “Independent Accountants”) for resolution. If issues are submitted to the Independent Accountants for resolution, (i) the Vendor and the Purchaser shall furnish or cause to be furnished to the Independent Accountants such working papers and other documents and information relating to the disputed issues as the Independent Accountants may request and are available to that party or its agents and shall be afforded the opportunity to present to the Independent Accountants any material relating to the disputed issues and to discuss the issues with the Independent Accountants; (ii) the determination by the Independent Accountants, as set forth in a notice to be delivered to both the Vendor and the Purchaser within thirty (30) days of the submission to the Independent Accountants of the issues remaining in dispute, shall be final, binding and conclusive on the parties and shall be determinative of the amount of the Purchaser’s Direct Claim; and (iii) the unsuccessful party in respect of the aggregate of the issues in dispute shall bear the fees and costs of the Independent Accountants for such determination. The determined amount of the Direct Claim, if any, shall be paid within three (3) Business Days after the Independent Accountant’s determination becomes binding and conclusive on the parties pursuant to this Section 11.4(b).

11.5 Third Party Claims

With respect to any Third Party Claim, the Indemnifying Party shall have the right, at its expense, to participate in or assume control of the negotiation, settlement or defence of the Claim and, in such event, the Indemnifying Party shall reimburse the Indemnified Party for all the Indemnified Party’s reasonable and substantiated out-of-pocket expenses as a result of such participation or assumption. If the Indemnifying Party elects to assume such control, the Indemnified Party shall have the right to participate in the negotiation, settlement or defence of such Third Party Claim and to retain counsel to act on its behalf, provided that the fees and disbursements of such counsel shall be paid by the Indemnified Party unless the Indemnifying Party consents to the retention of such counsel or unless the named parties to any action or proceeding include both the Indemnifying Party and the Indemnified Party and the representation of both the Indemnifying Party and the Indemnified Party by the same counsel would be inappropriate due to the actual or potential differing interests between them (such as the availability of different defences). If the Indemnifying Party, having elected to assume such control, thereafter fails to defend the Third Party Claim within a reasonable time, the Indemnified Party shall be entitled to assume such control, and the Indemnifying Party shall be bound by the results obtained by the Indemnified Party with respect to such Third Party Claim.

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11.6 Settlement of Third Party Claims

If the Indemnifying Party fails to assume control of the defence of any Third Party Claim, the Indemnified Party shall have the exclusive right to contest, settle or pay the amount claimed. Whether or not the Indemnifying Party assumes control of the negotiation, settlement or defence of any Third Party Claim, the Indemnifying Party shall not settle any Third Party Claim without the written consent of the Indemnified Party, which consent shall not be unreasonably withheld or delayed; provided, however, that the liability of the Indemnifying Party shall be limited to the proposed settlement amount if any such consent is not obtained for any reason.

11.7 Co-operation

The Indemnified Party and the Indemnifying Party shall co-operate fully with each other with respect to Third Party Claims, and shall keep each other fully advised with respect thereto (including supplying copies of all relevant documentation promptly as it becomes available).

11.8 Trustee and Agent

The Vendor acknowledges that the Purchaser is acting as trustee and agent for the remaining Purchaser Indemnified Parties, on whose behalf and for whose benefit the indemnity in Section 11.1 is provided and that such remaining Purchaser Indemnified Parties shall have the full right and entitlement to take the benefit of and enforce such indemnity notwithstanding that they may not individually be parties to this Agreement. The Vendor agrees that the Purchaser may enforce the indemnity for and on behalf of such remaining Purchaser Indemnified Parties and, in such event, the Vendor will not in any proceeding to enforce the indemnity by or on behalf of such remaining Purchaser Indemnified Parties assert any defence thereto based on the absence of authority or consideration or privity of contract and irrevocably waives the benefit of any such defence.

The Purchaser acknowledges that the Vendor is acting as trustee and agent for the remaining Vendor Indemnified Parties, on whose behalf and for whose benefit the indemnity in Section 11.2 is provided and that such remaining Vendor Indemnified Parties shall have the full right and entitlement to take the benefit of and enforce such indemnity notwithstanding that they may not individually be parties to this Agreement. The Purchaser agrees that the Vendor may enforce the indemnity for and on behalf of such remaining Vendor Indemnified Parties and, in such event, the Purchaser will not in any proceeding to enforce the indemnity by or on behalf of such remaining Vendor Indemnified Parties assert any defence thereto based on the absence of authority or consideration or privity of contract and irrevocably waives the benefit of any such defence.

11.9 Exclusivity

Except for the rights of the Purchaser pursuant to Sections 9.1(b) and the rights of the Vendor pursuant to Sections 9.2(b) and 9.2(c), the provisions of this Article 11 and any other indemnification provisions of this Agreement shall be the sole and exclusive remedies for any Claim for breach of any covenant, representation, warranty, indemnity or other provision of this Agreement or any certificate delivered pursuant to this Agreement (other than a claim for specific performance or injunctive relief or a claim based upon fraud or wilful misconduct) with the intent that all such Claims shall be subject to the limitations and other provisions contained in this Article 11.

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11.10 Insurance Proceeds and Taxes

The amount of the Indemnifying Party’s liability under this Agreement shall be determined taking into account any applicable insurance proceeds and other savings, including tax savings, that reduce the overall impact of the Losses upon the Indemnified Party. Any payment under this Article 11, other than a payment pursuant to Section 8.13(g), shall be treated for tax purposes as an adjustment to the Purchase Price to the extent such characterization is proper and permissible under Applicable Law.

11.11 Right to Claim Escrow Amount

The Purchaser may give notice of a claim in any amount to which it may be entitled under this Article 11 under the Escrow Agreement. Neither the giving of notice of a claim under the Escrow Agreement nor the failure to do so will constitute an election of remedies or limit the Purchaser in any manner in the enforcement of any other remedies that may be available to it.

11.12 Set off

Notwithstanding any other provision of this Agreement, the Purchaser shall, before demanding any payment by the Vendor pursuant to the indemnification obligations of the Vendor pursuant to this Article 11 or the amount (if any) payable by the Vendor pursuant to Section 3.6(e), set off such amount against (i) the Escrow Amount; or (ii) any other amounts payable by the Purchaser to the Vendor whether under this Agreement or otherwise.

11.13 Limitations on Claims

(a) Monetary Limitation.

With respect to those matters set out in Sections 11.1(a), in no event will the aggregate liability of the Vendor for indemnification hereunder exceed $2,500,000.

(b) Damages from the Vendor.

No Losses may be recovered from the Vendor under this Article 11 with respect to those matters set out in Sections 4.17 and 4.21 unless and until the accumulated aggregate amount of such Losses of the Purchaser Indemnified Parties exceeds $25,000, in which event the aggregate amount of all such Losses may be recovered (up to the monetary limit described in Section 11.13(a) above). With respect to all other Losses, no Losses may be recovered from the Vendor under this Article 11 unless and until the accumulated aggregate amount of Losses of the Purchaser Indemnified Parties exceeds $100,000, in which event the aggregate amount of all such Losses may be recovered (up to the monetary limit described in Section 11.13(a) above). Such limitation shall have no application to any claim to recover Losses based on any incorrectness in or breach of the Fundamental Representations, or (ii) any other representation or warranty of the Vendor in this Agreement resulting from fraud or intentional misrepresentation.

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11.14 Other Limitations

No amounts shall be payable under this Article 11 for Losses to the extent such Losses were accounted for in favour of the Indemnified Party in the calculation of any adjustment to the Purchase Price pursuant to Sections 3.6 or 3.7.

11.15 GST/HST Gross Up

If any payment made by the Vendor or the Purchaser pursuant to Section 9.2(c) or this Article 11 is deemed by the ETA to include GST/HST, or is deemed by any applicable provincial or territorial legislation to include a similar value added or multi-staged tax, the amount of such payment shall be increased accordingly.

ARTICLE 12 - MISCELLANEOUS

12.1 Notices

(c) Any notice or other communication required or permitted to be given hereunder shall be in writing and shall be delivered by personal delivery, by overnight courier, by fax or other form of electronic transmission or by registered mail addressed as follows:

If to the Vendor to:

Fred Deeley Imports Ltd.

13500 Verdun Place

Richmond, British Columbia

V6V 1V2

Canada

Attention:    President

Fax No.:    (604) 273-2761

With a copy (which shall not constitute notice) to:

Blake, Cassels & Graydon LLP

199 Bay Street

Suite # 4000, Commerce Court West

Toronto, ON

M5L 1A9

Canada

Attention:     David Shaw

Fax No.:     (416) 863-4196

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If to the Purchaser and/or HDMC to:

Harley-Davidson, Inc.
3700 W. Juneau Ave.
Milwaukee, WI, USA

53208

Attention:    General Counsel
Fax No.:    (414) 343-4189

With a copy (which shall not constitute notice) to:

Miller Thomson LLP

Barristers and Solicitors

Scotia Plaza, 40 King Street West
Suite 5800, P.O. Box 1011
Toronto, ON

M5H 3S1

Attention:    Robert Stewart
Fax No: 416.595.8695

(d) Any such notice or other communication delivered by personal delivery or overnight courier shall be deemed to have been given and received on the day on which it was delivered (or, if such day is not a Business Day, on the next following Business Day), and if transmitted by fax or other form of electronic transmission, on the day of transmission thereof if such day is a Business Day and is received before 5:00 pm (local time to the recipient) or otherwise on the next Business Day after the day of transmittal, provided that the party so transmitting the notice has received confirmation of its successful transmittal, and if mailed or sent by registered mail, on the fifth Business Day following the date of mailing; provided, however, that if at the time of mailing or within three Business Days thereafter there is or occurs a labour dispute or other event which might reasonably be expected to disrupt the delivery of documents by mail, any notice or other communication hereunder shall be delivered or transmitted by means personal delivery or recorded electronic communication as aforesaid. Any party may at any time change its address for service from time to time by giving notice to the other parties in accordance with this Section 12.1.

12.2 Announcements

The parties shall consult with each other before issuing any press release or making any other public announcement with respect to this Agreement or the transactions contemplated hereby and, except as required by any applicable law or regulatory requirement, neither of them shall issue any such press release or make any such public announcement without the prior written consent of the other party, which consent shall not be unreasonably withheld or delayed.

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12.3 Disclosure

Prior to any public announcement of the transaction contemplated hereby pursuant to Section 12.2, none of the parties shall disclose this Agreement or any aspects of such transaction except to its board of directors, its senior management, its legal, accounting, financial or other professional advisors, any financial institution contacted by it with respect to any financing required in connection with such transaction and counsel to such institution, or as may be required by any applicable law or any regulatory authority or stock exchange having jurisdiction.

12.4 Reasonable Commercial Efforts

The parties acknowledge and agree that, for all purposes of this Agreement, an obligation on the part of any party to use reasonable commercial efforts to obtain any waiver, consent, approval, permit, licence or other document shall not require such party to make any payment to any person for the purpose of procuring the same, other than payments for amounts due and payable to such person, payments for incidental expenses incurred by such person and payments required by any applicable law or regulation.

12.5 Expenses

Except as otherwise provided in this Agreement, each party shall bear all expenses incurred by it in connection with the negotiation and entering into of the Agreement and the transactions contemplated therein including the fees and expenses of their respective counsel, accountants and financial advisors.

12.6 Counterparts

This Agreement may be executed in counterparts, each of which shall constitute an original and all of which taken together shall constitute one and the same instrument. Execution may be made by facsimile signature which, for all purposes, shall be deemed to be an original.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK.]

IN WITNESS WHEREOF this Agreement has been executed by the parties.

HARLEY-DAVIDSON CANADA LP, by its general partner,HARLEY-DAVIDSON CANADA GP INC.
Per:	/s/ Anoop Prakash
	Name: Anoop Prakash
	Title: Director
	I have the authority to bind the limited partnership

FRED DEELEY IMPORTS LTD.
Per:	/s/ Malcolm Hunter
	Name: Malcom Hunter
	Title: President
	I have the authority to bind the company

HARLEY-DAVIDSON MOTOR COMPANY, INC.
Per:	/s/ John A. Olin
	Name: John A. Olin
	Title: Senior Vice President and CFO
	I have the authority to bind the company

July 31^st, 2015

Private and Confidential

Fred Deeley Imports Ltd.

13500 Verdun Place

Richmond, British Columbia

V6V 1V2

Attention: President

Dear Sirs:

Re: Asset purchase agreement dated as of April 30, 2015 amongst Harley-Davidson Canada LP (the “Purchaser”), Fred Deeley Imports Ltd. (the “Vendor”) and Harley-Davidson Motor Company (the “Asset Purchase Agreement”) whereby the Purchaser agreed to acquire and the Vendor agreed to sell the Business and the Purchased Assets (as such terms are defined in the Asset Purchase Agreement).

And Re: Capitalized terms otherwise undefined herein shall have the meanings ascribed thereto in the Asset Purchase Agreement.

In anticipation of the closing of the transactions contemplated by or in connection with the Asset Purchase Agreement, the parties have agreed to enter into this Side Letter to document their agreement on certain matters. The parties agree as follows:

1. Notwithstanding the terms of the Asset Purchase Agreement or any transaction documents contemplated by the Asset Purchase Agreement, the Vendor and the Purchaser agree to the matters set out in Schedule “A” attached hereto.

2. No amendment or waiver of this Side Letter shall be binding on any party unless consented to by such party.

- Signatures on next page -

If the terms of this Letter Agreement are acceptable to you, please confirm by executing a copy hereof.

HARLEY-DAVIDSON CANADA LP, by its general partner, HARLEY-DAVIDSON CANADA GP INC.
Per:	/s/ Anoop Prakash
	Name:Anoop Prakash
	Title:President

AGREED AND ACCEPTED this 31^st day of July, 2015.

Fred Deeley Imports Ltd.
Per:	/s/ Malcolm Hunter
	Name:Malcolm Hunter
	Title:President
	I have the authority to bind the Corporation

SCHEDULE “A”

ITEM	DESCRIPTION
1.	The Purchaser has agreed to reimburse the Vendor for the cost of the Vendor’s counsel to review the Escrow Agreement in the amount of $3,000, in satisfaction of such obligation under Section 8.4 of the Asset Purchase Agreement, and its equal share of the cost of the town hall meetings in the amount of $64,223.65, in satisfaction of such obligation under Section 8.10 of the Asset Purchase Agreement. Such amounts will be reflected as closing adjustments to the estimated Purchase Price and reflected in the statement of adjustments on Closing.
2.	The Vendor has agreed to include office furniture and equipment for 20 workstations and 1 conference room in Schedule “B” of the Richmond Occupancy License and such furniture and equipment will be considered “Furniture and Equipment” for the purposes of the Richmond Occupancy License. The Vendor shall be entitled to remove such furniture and equipment from the Richmond Property with advance notice to the Purchaser on any two consecutive days between December 15 and 31, 2015. The Vendor has agreed to allow the Purchaser to use training room tables, or comparable furniture, from the date that the office furniture and equipment for workstations is removed by the Vendor to and until December 31, 2015.
3.	The Purchaser and the Vendor have agreed to treat the effective closing time as 12:01 a.m. EDT on the Closing Date subject to delivery of purchase price funds and confirmation of the release of any escrow conditions with respect to closing documents by the Purchaser and the Vendor on Closing.
4.	The Vendor has agreed to provide the Purchaser with full access to its warehouse located at the Concord Property on July 30th and 31st, 2015 between the hours of 9:00 a.m. and 4:00 p.m. EDT for the purposes of conducting a physical inventory count of the Vendor’s inventory. The Vendor has further agreed that the results of such physical inventory count may be utilized by the Purchaser in the preparation of the Final Closing Date Financial Statement notwithstanding that the inventory count is conducted prior to the Closing Date, provided however, that such agreement does not impact the Vendor’s rights pursuant to Section 3.6(b) of the Asset Purchase Agreement.
5.	The Vendor and the Purchaser have agreed to use the Bank of Canada’s noon spot exchange rate on July 24, 2015 for the purposes of the conversion of any U.S. dollar amounts into Canadian dollar amounts included in the calculation of Purchase Price and otherwise reflected on the Statement of Proceeds and Adjustments.
6.	The Purchaser has agreed to accept delivery by the Vendor of an extension to the statement of work related to managed cloud hosting services for the Vendor’s UltraComm application to July 23, 2016 in satisfaction of the Vendor’s obligations contained in sections 8.19 and 9.1(a)(v) of the Asset Purchase Agreement.
7.	The Purchaser has agreed to assume the obligations under the FreeWheeler Loan Program arising from and after the Closing Date (and all such obligations shall be Assumed Liabilities), provided that any obligations incurred or accrued under the FreeWheeler Loan Program prior to the Closing Date (and for greater certainty, notwithstanding that such amounts may not be due and payable until after the Closing Date) shall be Excluded Liabilities.
8.	The Purchaser has determined that the transaction is not subject to the pre-notification provisions of the Competition Act, and therefore the Purchaser irrevocably waives the closing condition in Section 9.1(a)(iv) of the Asset Purchase Agreement.
9.	Attached as Schedule “A” is a list of the Assumed Contracts, which the Purchaser and the Vendor have agreed is true and complete and replaces the Assumed Contracts as defined in the Asset Purchase Agreement. The list of Assumed Contracts shall not be construed as amending or modifying Schedule 1.1(iiiii) (Vendor Contracts).

10. The Purchaser shall be responsible for and shall indemnify the Vendor in respect of any damage to property, personal injury or death caused by the acts or omissions of Purchaser, its employees, subcontractors or agents occurring in the course of the Purchaser’s access to the Richmond Property or the Concord Property and to the Systems prior to the Closing. Provided that the Purchaser shall be given prompt written notice of and shall have control over the defense of any third party claims arising out of such damage; the Purchaser may agree, without Vendor’s prior consent, to any settlement that does not impose any liability on Vendor; and the Vendor shall upon the request of the Purchaser provide all reasonable assistance based on the resources available to Deeley in the defense of any third party claims (provided that the Purchaser shall reimburse all reasonable out-of-pocket expenses of the Vendor).

14579284.6

EX-10.1

NON-COMPETITION AND NON-SOLICITATION AGREEMENT

THIS AGREEMENT made the 4^th day of August, 2015

BETWEEN:

DON JAMES (the “Restricted Party”)

- and -

HARLEY-DAVIDSON CANADA LP,a limited partnership established under the laws of the Province of Ontario (the “Purchaser”)

RECITALS:

A.Pursuant to an asset purchase agreement (the “Asset Purchase Agreement”) dated as of April 30, 2015, between the Purchaser, Fred Deeley Imports Ltd. (the “Vendor”) and Harley-Davidson Motor Company, the Purchaser has agreed to acquire, and the Vendor has agreed to sell, the Business and Purchased Assets (as such terms are defined in the Asset Purchase Agreement).

B.    The Restricted Party’s knowledge and experience in the Restricted Activity (as defined below) is specialized and highly competitive.

C.    Pursuant to Section 8.7 of the Asset Purchase Agreement, it is a condition precedent to the completion of the transactions that the Restricted Party enter into this Agreement.

NOW, THEREFORE, in consideration of the premises and covenants contained in this Agreement and for other good and valuable consideration (the receipt and sufficiency of which are acknowledged), the Parties agree as follows:

ARTICLE 1
INTERPRETATION

1.1 Definitions

In this Agreement, capitalized terms not otherwise defined have the meaning given to such terms in the Asset Purchase Agreement, and:

(a) “Affiliate” has the meaning given to that term in the Canada Business Corporations Act.

(b) “Asset Purchase Agreement” has the meaning given to it in the recitals.

(c) “Business” means the business currently carried on by the Vendor as such term is defined in the Asset Purchase Agreement.

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(d) “Dealership Business” has the meaning given to it in the Asset Purchase Agreement.

(e) “Governmental Authority” means any national, multi-national, federal, provincial, state, municipal, local or other government, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government.

(f) “Non-Interference Period” means the period of five (5) years commencing on the date of this Agreement.

(g) “Parties” means, collectively, the Restricted Party and the Purchaser and “Party” means either of them.

(h) “Person” means any individual, estate, trust, firm, partnership, joint venture, corporation, unlimited liability company, limited liability company, unincorporated association or organization, government or any agency or ministry of any government, and includes any successor to any of the foregoing.

(i) “Restricted Activities” means the marketing, distribution and sale of motorcycles, motorcycle parts, and related apparel and merchandise, but explicitly excludes the Dealership Business.

(j) “Territory” means Canada, being the jurisdiction where the Business is or has been operated.

1.2 Interpretation

In this Agreement:

(a) Unless specified otherwise, reference to a statute includes any regulations under such statute and refers to that statute and such regulations as they may be amended or to any successor legislation.

(b) The division into articles, sections, paragraphs and schedules and the insertion of headings are for convenience of reference only and will not affect the construction or interpretation of this Agreement. The words “hereto”, “herein”, “hereof”, “hereunder” and similar expressions refer to this Agreement and not to any particular portion of it. References to an Article, Section, Paragraph or Schedule refer to the applicable article, section, paragraph or schedule of this Agreement.

(c) Words in the singular include the plural and vice versa, words in one gender include all genders, and the words “including”, “include” and “includes” mean “including (or include or includes) without limitation”.

(d) This Agreement is the joint product of the Parties, has been subject to mutual consultation, negotiation and agreement and will not be construed for or against any Party.

ARTICLE 2
TERMINATION

2.1 Term

This Agreement shall be in force during the Non-Interference Period.

ARTICLE 3
NON-COMPETITION

3.1 Non-Competition

(a) The Restricted Party shall not and shall ensure that its Affiliates do not, for the Non-Interference Period, within the Territory, directly or indirectly, in any manner whatsoever including either individually, in partnership, jointly or in conjunction with any other Person, or as employee, consultant, independent contractor, principal, agent, director, officer, investor, owner or shareholder, supply products or services to any customer of the Restricted Activity or:

(i) establish, carry on, be engaged in or concerned with or interested in, any undertaking or business;

(ii) have any financial interest (including an interest by way of royalty or other compensation arrangements) in or in respect of the business of any Person which carries on, directly or indirectly, an undertaking or business;

(iii) advise, lend money to, guarantee the debts or obligations of or give security on behalf of any Person which carries on, directly or indirectly, an undertaking or business;

(iv) consent to its name or the trade name(s) to be used or employed by any Person, directly or indirectly, engaged or concerned with or interested in any aspect of an undertaking or business,

in each case, which is substantially the same as the Restricted Activity, or competes in whole or in part with, the Business.

3.2 Exception

Notwithstanding Section 3.1, the Restricted Party may:

(a) have an equity investment in any Person whose equity securities are listed on a recognized stock exchange, where the equity investment does not in the aggregate exceed five percent (5%) of the issued equity shares of that Person;

(b) continue to provide financial support to Fox Harley-Davidson, including keeping agreements in place relating to security and a term deposit that Fred Deeley Limited has provided to Royal Bank to support Fox Harley-Davidson's operating line, and

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a guarantee from Fred Deeley Limited to HDFS for a loan HDFS provided to Fox Harley-Davidson.

(c) engage in and operate the Dealership Business; or

(d) sell, assist with the marketing and sale of, hire or engage the services of any third party to assist with the marketing and sale of, any Excluded Asset, and any assets or inventory acquired as a result of an obligation to acquire or repurchase such assets or inventory pursuant to the Restricted Party’s Vendor Agreement with GE Commercial Distribution Finance Canada, on such terms as the Restricted Party may determine in its sole and unfettered discretion.

3.3 Enforceability

Notwithstanding anything in this Article 3 to the contrary, if at any time, in any judicial proceeding, any of the restrictions stated in this Article are found by a final order of a court of competent jurisdiction to be unreasonable or otherwise unenforceable under circumstances then existing, the Parties agree that the period, scope or geographical area, as the case may be, shall be reduced to the extent necessary to enable the court to enforce the restrictions to the extent such provisions are allowable under law, giving effect to the agreement and intent of the Parties that the restrictions contained herein shall be effective to the fullest extent permissible.

ARTICLE 4
NON-SOLICITATION/NON-DISPARAGEMENT

4.1 Non-Solicitation

The Restricted Party shall not, during the Non-Interference Period, directly or indirectly, in any manner whatsoever:

(a) canvass or solicit the business of (or procure or assist the canvassing or soliciting of the business of) any Person that was a customer of the Purchaser or reasonably prospective customer of the Purchaser, as of the date hereof, in connection with activities which are substantially the same as the Restricted Activity or are, in whole or in part, in competition with the Business; or

(b) induce or attempt to induce any officer, director, partner, employee or agent of the Purchaser to leave the employ of the Purchaser, or in any way interfere with the relationship between the Purchaser and any such Person, hire directly or indirectly any Person who was an officer, director, partner, employee or agent of the Purchaser for a period of one (1) year from the date such Person was terminated or left the employ of the Purchaser without the prior written permission of the Purchaser; or induce or attempt to induce any customer, supplier, licensee or other business relation of the Purchaser to cease doing business with the Purchaser or in any way interfere with the relationship between any such customer, supplier, licensee or business relation of the Purchaser. For greater certainty, general solicitations of employment

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published in a newspaper, over the internet, or in another publication of general circulation and not specifically directed towards such individuals shall not be deemed to constitute solicitation for purposes of this Section 4.1.

4.2 Non-Disparagement

The Restricted Party shall not, during the Non-Interference Period, take any action or publish any communication which could reasonably be expected to have a materially negative impact on the reputation of the Purchaser or its products or services.

ARTICLE 5
PROPRIETARY INFORMATION

5.1 Proprietary Information

(a) The Restricted Party acknowledges and agrees that it had detailed confidential or proprietary information and trade secrets concerning the Business (collectively, the “Proprietary Information”). The Restricted Party acknowledges that disclosure of any of the Proprietary Information to competitors of the Purchaser, or the Business or to the general public, or the use of same by any competitor of the Purchaser, or the Business would be highly detrimental to the interests of the Purchaser, and the Business and hereby covenants and agrees that it shall maintain the confidentiality of all Proprietary Information and shall not use such information, howsoever obtained, for any purpose whatsoever until the date, if any, on which (i) the relevant information becomes available to the public without breach of this Agreement or similar agreements or (ii) the Restricted Party is required to disclose such information by any law (including rule or regulation) or any court or governmental or regulatory authority of competent jurisdiction, in which case the Restricted Party shall be entitled to disclose or make use of such information only to the extent it is so required; provided that before disclosure is made, to the extent legally possible, notice of the legal requirement is provided to the Purchaser and, to the extent possible in the circumstances, the Purchaser is afforded the opportunity to dispute the requirement or otherwise protect the subject Proprietary Information.

(b) For greater certainty, nothing in this Article 5 shall limit the Restricted Party’s ability to operate the Dealership Business or to utilize any Proprietary Information in connection therewith.

(c) The provisions of this Section 5.1 shall survive the termination or expiration of this Agreement.

ARTICLE 6
REMEDIES

6.1 Equitable Remedies

The Restricted Party acknowledges that:

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(a) a breach or threatened breach by the Restricted Party of any of the provisions of this Agreement would cause the Purchaser irreparable harm not compensable in damages alone; and

(b) it is essential to the effective enforcement of this Agreement that, in addition to any other remedies to which the Purchaser may be entitled at law or in equity or otherwise under this Agreement, the Purchaser be entitled to seek and obtain, in a summary manner, from any court having jurisdiction, interim, interlocutory, and permanent injunctive relief, specific performance and other equitable remedies.

ARTICLE 7
ACKNOWLEDGEMENT

7.1 Restricted Party Acknowledgments

The Restricted Party acknowledges that:

(a) having regard to the importance of goodwill of the Business and Purchased Assets purchased under the Asset Purchase Agreement, the purchase price for the Business and Purchased Assets and all of the circumstances of the transactions, it is necessary that the Restricted Party enter into this Agreement in order for the Purchaser to receive the full benefit of the Business and the Purchased Assets and of the goodwill relating to the Business and the Purchased Assets and to protect itself from the irreparable harm that would arise out of any breach of the terms of this Agreement; and

(b) the terms of this Agreement are just and reasonable.

ARTICLE 8
NOTICES

8.1 Notices

Any notice, direction or other instrument required or permitted to be given to any party hereto shall be in writing and shall be sufficiently given if delivered personally, or transmitted by facsimile, as follows:

(a) in the case of the Purchaser to:

Harley-Davidson, Inc.
3700 W. Juneau Ave.
Milwaukee, WI, USA

53208

Attention:    General Counsel
Fax No.:    (414) 343-4189

– 6 –

(b) in the case of the Restricted Party, to:

Donald James

11200 W. Saanich Road

North Saanich, BC

V8L 5P4

8.2 Delivery of Notices

Any such notice, direction or other instrument, if delivered personally, shall be deemed to have been given and received on the day on which it was delivered, provided that if such day is not a Business Day then the notice, direction or other instrument shall be deemed to have been given and received on the first Business Day next following such day and if transmitted by facsimile, shall be deemed to have been given and received on the day of its transmission, provided that if such day is not a Business Day or if it is transmitted or received after the end of normal business hours then the notice, direction or other instrument shall be deemed to have been given and received on the first Business Day next following the day of such transmission.

8.3 Change of Address

Any Party may change its address for service from time to time by notice given to the other Party in accordance with the foregoing provisions.

ARTICLE 9
GENERAL

9.1 Severability

If any provision of this Agreement is invalid or unenforceable, such provision shall be severed and the remainder of this Agreement shall be unaffected thereby but shall continue to be valid and enforceable to the fullest extent permitted by law. Subject to Section 3.3, the provisions of this Agreement are severable and if any provisions are in conflict with any applicable law, the conflicting provisions shall be deemed never to have constituted a part of this Agreement and shall not affect or impair any of the remaining provisions thereof.

9.2 Amendment and Waiver

This Agreement may only be amended or terminated by written agreement signed by each Party. Any waiver of any provision of this Agreement will be effective only if it is in writing and signed by the Party to be bound thereby, and only in the specific instance and for the specific purpose for which it has been given. No failure on the part of any Party to exercise, and no delay in exercising, any right under this Agreement will operate as a waiver of such right.

9.3 Time

– 7 –

Time is of the essence of this Agreement.

9.4 Further Assurances

Each Party agrees that upon the reasonable written request of the other Party, at any time, it will perform all acts and execute all documents as may be necessary or desirable to effect the purpose of this Agreement or to better evidence the transactions contemplated by this Agreement.

9.5 Governing Law and Attornment

(a) This Agreement is governed by and will be construed in accordance with the laws of the Province of Ontario and the federal laws of Canada applicable therein.

(b) The Parties: (a) hereby irrevocably and unconditionally submit to the non-exclusive jurisdiction of the courts of the Province of Ontario and to any appellate court for the purpose of any suit, action or other proceeding arising out of or based upon this Agreement; (b) agree not to commence any suit, action or other proceeding arising out of or based upon this Agreement except in the courts of the Province of Ontario; and (c) hereby waive, and agree not to assert, by way of motion, as a defense, or otherwise, in any such suit, action or proceeding, any claim that it is not subject personally to the jurisdiction of the above-named courts, that its property is exempt or immune from attachment or execution, that the suit, action or proceeding is brought in an inconvenient forum, that the venue of the suit, action or proceeding is improper or that this Agreement or the subject matter hereof may not be enforced in or by such court.

9.6 Entire Agreement

This Agreement constitutes the entire agreement between the Parties relating to the subject matter hereof and supersedes all prior agreements, understandings, negotiations and discussions, whether oral or written. There are no representations, warranties, conditions, covenants or other agreements, express or implied, collateral, statutory or otherwise, between the Parties in connection with the subject matter of this Agreement, except as specifically set forth herein.

9.7 Benefit of Agreement

This Agreement will enure to the benefit of and be binding upon the Parties and their respective successors and assigns. This Agreement may not be assigned by the Restricted Party without the prior written consent of the Purchaser. Upon prior written notice to the Restricted Party, this Agreement may be assigned by the Purchaser to:

(a) a corporation which is a holding body corporate, a subsidiary body corporate or an affiliate of the Purchaser (within the meaning of the Canada Business Corporations Act);

– 8 –

(b) a corporation formed as a result of a merger or amalgamation of the Purchaser with another corporation or corporations; and/or

(c) any assignee or purchaser of the majority of the Purchaser’s shares or all or substantially all of its assets.

9.8 Remedies

The rights and remedies of a Party under this Agreement are cumulative and are in addition to, and not in substitution for, any rights or remedies provided by law or by equity, and any single or partial exercise by a Party of any right or remedy for a default or breach of any term, covenant, condition or agreement contained in this Agreement does not waive, alter, affect or prejudice any other right or remedy or other rights or remedies to which such Party may be entitled for such default or breach.

9.9 Counterparts and Electronic Execution

This Agreement may be executed in any number of counterparts, each of which will be deemed to be an original and all of which taken together will be deemed to constitute one and the same instrument.

This Agreement may be executed and delivered by electronic means and each of the Parties may rely on such electronic execution as though it were an original hand-written signature.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK.]

– 9 –

IN WITNESS WHEREOF the Parties have duly executed this Agreement as of the date first written above.

/s/ Don James

DON JAMES

HARLEY-DAVIDSON CANADA LP, by its general partner, HARLEY-DAVIDSON CANADA GP INC.
Per:	/s/ Anoop Prakash
	Name: Anoop Prakash
	Title: President
	I have the authority to bind the Limited Partnership

EX-31.1

Exhibit 31.1

Chief Executive Officer Certification

Pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934

I, Matthew S. Levatich, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Harley-Davidson, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth quarter in case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of registrant's board of directors:

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: August 6, 2015	/s/ Matthew S. Levatich
	Matthew S. Levatich
	President and Chief Executive Officer

EX-31.2

Exhibit 31.2

Chief Financial Officer Certification

Pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934

I, John A. Olin, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Harley-Davidson, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth quarter in case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of registrant's board of directors:

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: August 6, 2015	/s/ John A. Olin
	John A. Olin
	Senior Vice President and
	Chief Financial Officer

EX-32.1

Exhibit 32.1

Written Statement of the Chief Executive Officer and Chief Financial Officer

Pursuant to 18 U.S.C. sec. 1350

Solely for the purpose of complying with 18 U.S.C. §1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, we, the undersigned President and Chief Executive Officer and the Senior Vice President and Chief Financial Officer of Harley-Davidson, Inc. (the “Company”), hereby certify, based on our knowledge, that the Quarterly Report on Form 10-Q of the Company for the quarter ended June 28, 2015 (the “Report”) fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934 and that information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: August 6, 2015	/s/ Matthew S. Levatich
	Matthew S. Levatich
	President and Chief Executive Officer
	/s/ John A. Olin
	John A. Olin
	Senior Vice President and
	Chief Financial Officer

XML

New Accounting Standards Debt Issuance Cost (Details) $ in Millions	Jun. 28, 2015 USD ($)
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]
Deferred Finance Costs, Net	$ 18.4

XML

Derivative Instruments And Hedging Activities (Derivative Instrument Fair Value) (Detail) - USD ($) $ in Thousands		Jun. 28, 2015	Dec. 31, 2014	Jun. 29, 2014
Derivatives Designated As Hedging Instruments [Member]
Derivative [Line Items]
Derivative, Notional Amount		$ 668,475	$ 340,805	$ 399,749
Derivatives Designated As Hedging Instruments [Member] | Other Current Assets [Member]
Derivative [Line Items]
Derivative Asset, Current	[1]	26,501	32,244	3,091
Derivatives Designated As Hedging Instruments [Member] | Accrued Liabilities [Member]
Derivative [Line Items]
Derivative Liability, Current	[2]	98	414	1,478
Derivatives Designated As Hedging Instruments [Member] | Foreign Currency Contracts [Member] | Cash Flow Hedging [Member]
Derivative [Line Items]
Derivative, Notional Amount	[3]	367,309	339,077	398,338
Derivatives Designated As Hedging Instruments [Member] | Foreign Currency Contracts [Member] | Other Current Assets [Member] | Cash Flow Hedging [Member]
Derivative [Line Items]
Derivative Asset, Current	[1],[3]	23,136	32,244	3,091
Derivatives Designated As Hedging Instruments [Member] | Foreign Currency Contracts [Member] | Accrued Liabilities [Member] | Cash Flow Hedging [Member]
Derivative [Line Items]
Derivative Liability, Current	[2],[3]	0	0	1,461
Derivatives Designated As Hedging Instruments [Member] | Commodity Contract [Member] | Cash Flow Hedging [Member]
Derivative [Line Items]
Derivative, Notional Amount	[3]	1,166	1,728	1,411
Derivatives Designated As Hedging Instruments [Member] | Commodity Contract [Member] | Other Current Assets [Member] | Cash Flow Hedging [Member]
Derivative [Line Items]
Derivative Asset, Current	[1],[3]	0	0	0
Derivatives Designated As Hedging Instruments [Member] | Commodity Contract [Member] | Accrued Liabilities [Member] | Cash Flow Hedging [Member]
Derivative [Line Items]
Derivative Liability, Current	[2],[3]	98	414	17
Derivatives Designated As Hedging Instruments [Member] | Interest Rate Lock Commitments [Member] | Cash Flow Hedging [Member]
Derivative [Line Items]
Derivative, Notional Amount	[3]	300,000	0	0
Derivatives Designated As Hedging Instruments [Member] | Interest Rate Lock Commitments [Member] | Other Current Assets [Member] | Cash Flow Hedging [Member]
Derivative [Line Items]
Derivative Asset, Current	[1],[3]	3,365	0	0
Derivatives Designated As Hedging Instruments [Member] | Interest Rate Lock Commitments [Member] | Accrued Liabilities [Member] | Cash Flow Hedging [Member]
Derivative [Line Items]
Derivative Liability, Current	[2],[3]	0	0	0
Derivatives Not Designated As Hedging Instruments [Member]
Derivative [Line Items]
Derivative, Notional Amount		8,218	11,804	7,754
Derivatives Not Designated As Hedging Instruments [Member] | Other Current Assets [Member]
Derivative [Line Items]
Derivative Asset, Current	[1]	0	0	68
Derivatives Not Designated As Hedging Instruments [Member] | Accrued Liabilities [Member]
Derivative [Line Items]
Derivative Liability, Current	[2]	888	1,613	0
Derivatives Not Designated As Hedging Instruments [Member] | Commodity Contract [Member]
Derivative [Line Items]
Derivative, Notional Amount		8,218	11,804	7,754
Derivatives Not Designated As Hedging Instruments [Member] | Commodity Contract [Member] | Other Current Assets [Member]
Derivative [Line Items]
Derivative Asset, Current	[1]	0	0	68
Derivatives Not Designated As Hedging Instruments [Member] | Commodity Contract [Member] | Accrued Liabilities [Member]
Derivative [Line Items]
Derivative Liability, Current	[2]	$ 888	$ 1,613	$ 0

[1] ncluded in other current assets

[2] Included in accrued liabilities

[3] Derivative designated as a cash flow hedge

XML

Finance Receivables (Aging Of Past Due Finance Receivables Including Non Accrual Status Finance Receivables) (Detail) - USD ($) $ in Thousands	Jun. 28, 2015	Dec. 31, 2014	Jun. 29, 2014
Financing Receivable, Recorded Investment, Past Due [Line Items]
Current	$ 7,143,453	$ 6,379,379	$ 6,807,233
31-60 Days Past Due	97,495	113,390	91,118
61-90 Days Past Due	28,331	38,558	28,201
Greater than 90 Days Past Due	18,447	28,918	14,720
Total Past Due	144,273	180,866	134,039
Total Finance Receivables	7,287,726	6,560,245	6,941,272
Retail [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Current	5,819,279	5,427,719	5,469,796
31-60 Days Past Due	96,982	113,007	90,617
61-90 Days Past Due	28,150	38,486	28,088
Greater than 90 Days Past Due	18,274	28,712	14,686
Total Past Due	143,406	180,205	133,391
Total Finance Receivables	5,962,685	5,607,924	5,603,187
Wholesale [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Current	1,324,174	951,660	1,337,437
31-60 Days Past Due	513	383	501
61-90 Days Past Due	181	72	113
Greater than 90 Days Past Due	173	206	34
Total Past Due	867	661	648
Total Finance Receivables	$ 1,325,041	$ 952,321	$ 1,338,085

XML

Supplemental Consolidating Data (Operations) (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 28, 2015	Jun. 29, 2014	Jun. 28, 2015	Jun. 29, 2014
Segment Reporting Information [Line Items]
Motorcycles and Related Products	$ 1,650,783	$ 1,834,285	$ 3,161,353	$ 3,405,973
Financial Services	173,609	166,414	335,984	320,774
Total revenue	1,824,392	2,000,699	3,497,337	3,726,747
Motorcycles and Related Products cost of goods sold	1,003,569	1,110,146	1,923,864	2,089,703
Financial Services interest expense	41,188	40,741	79,724	79,598
Provision for credit losses	15,175	15,961	41,422	36,292
Selling, administrative and engineering expense	301,944	286,156	579,693	562,577
Total costs and expenses	1,361,876	1,453,004	2,624,703	2,768,170
Operating income	462,516	547,695	872,634	958,577
Investment income	1,450	1,772	2,772	3,431
Interest expense	9	393	18	4,070
Income before provision for income taxes	463,957	549,074	875,388	957,938
Provision for income taxes	164,147	194,921	305,724	337,868
Net income	299,810	354,153	569,664	620,070
Motorcycles And Related Products Operations [Member]
Segment Reporting Information [Line Items]
Motorcycles and Related Products	1,653,759	1,836,974	3,166,641	3,410,941
Financial Services	0	0	0	0
Total revenue	1,653,759	1,836,974	3,166,641	3,410,941
Motorcycles and Related Products cost of goods sold	1,003,569	1,110,146	1,923,864	2,089,703
Financial Services interest expense	0	0	0	0
Provision for credit losses	0	0	0	0
Selling, administrative and engineering expense	267,149	251,432	512,284	496,197
Total costs and expenses	1,270,718	1,361,578	2,436,148	2,585,900
Operating income	383,041	475,396	730,493	825,041
Investment income	1,450	1,772	102,772	123,431
Interest expense	9	393	18	4,070
Income before provision for income taxes	384,482	476,775	833,247	944,402
Provision for income taxes	134,633	168,303	256,149	288,876
Net income	249,849	308,472	577,098	655,526
Financial Services Operations [Member]
Segment Reporting Information [Line Items]
Motorcycles and Related Products	0	0	0	0
Financial Services	174,147	166,963	336,837	321,649
Total revenue	174,147	166,963	336,837	321,649
Motorcycles and Related Products cost of goods sold	0	0	0	0
Financial Services interest expense	41,188	40,741	79,724	79,598
Provision for credit losses	15,175	15,961	41,422	36,292
Selling, administrative and engineering expense	38,309	37,962	73,550	72,223
Total costs and expenses	94,672	94,664	194,696	188,113
Operating income	79,475	72,299	142,141	133,536
Investment income	0	0	0	0
Interest expense	0	0	0	0
Income before provision for income taxes	79,475	72,299	142,141	133,536
Provision for income taxes	29,514	26,618	49,575	48,992
Net income	49,961	45,681	92,566	84,544
Consolidation, Eliminations [Member]
Segment Reporting Information [Line Items]
Motorcycles and Related Products	(2,976)	(2,689)	(5,288)	(4,968)
Financial Services	(538)	(549)	(853)	(875)
Total revenue	(3,514)	(3,238)	(6,141)	(5,843)
Motorcycles and Related Products cost of goods sold	0	0	0	0
Financial Services interest expense	0	0	0	0
Provision for credit losses	0	0	0	0
Selling, administrative and engineering expense	(3,514)	(3,238)	(6,141)	(5,843)
Total costs and expenses	(3,514)	(3,238)	(6,141)	(5,843)
Operating income	0	0	0	0
Investment income	0	0	(100,000)	(120,000)
Interest expense	0	0	0	0
Income before provision for income taxes	0	0	(100,000)	(120,000)
Provision for income taxes	0	0	0	0
Net income	$ 0	$ 0	$ (100,000)	$ (120,000)

XML

Derivative Instruments And Hedging Activities (Gain Loss On Derivative Cash Flow Hedges Recognized In OCI) (Detail) - Cash Flow Hedging [Member] - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 28, 2015	Jun. 29, 2014	Jun. 28, 2015	Jun. 29, 2014
Derivative Instruments And Hedging Activities [Line Items]
Amount of Gain/(Loss) Recognized in OCI, before tax	$ (1,096)	$ 3,907	$ 31,452	$ 2,684
Foreign Currency Contracts [Member]
Derivative Instruments And Hedging Activities [Line Items]
Amount of Gain/(Loss) Recognized in OCI, before tax	(4,458)	3,931	28,210	2,493
Commodity Contract [Member]
Derivative Instruments And Hedging Activities [Line Items]
Amount of Gain/(Loss) Recognized in OCI, before tax	(3)	(24)	(123)	191
Interest Rate Lock Commitments [Member]
Derivative Instruments And Hedging Activities [Line Items]
Amount of Gain/(Loss) Recognized in OCI, before tax	$ 3,365	$ 0	$ 3,365	$ 0

XML

Finance Receivables (Changes In Allowance For Credit Losses On Finance Receivables) (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 28, 2015	Jun. 29, 2014	Jun. 28, 2015	Jun. 29, 2014
Accounts, Notes, Loans and Financing Receivable [Line Items]
Provision for Loan and Lease Losses	$ 15,175	$ 15,961	$ 41,422	$ 36,292
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Balance, beginning of period	132,820	114,529	127,364	110,693
Charge-offs	(21,003)	(19,018)	(53,736)	(46,361)
Recoveries	12,239	10,883	24,181	21,731
Balance, end of period	139,231	122,355	139,231	122,355
Retail [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Provision for Loan and Lease Losses	16,890	16,258	39,433	33,466
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Balance, beginning of period	123,777	106,776	122,025	106,063
Charge-offs	(21,003)	(19,018)	(53,736)	(46,361)
Recoveries	12,239	10,883	24,181	21,731
Balance, end of period	131,903	114,899	131,903	114,899
Wholesale [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Provision for Loan and Lease Losses	(1,715)	(297)	1,989	2,826
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Balance, beginning of period	9,043	7,753	5,339	4,630
Charge-offs	0	0	0	0
Recoveries	0	0	0	0
Balance, end of period	$ 7,328	$ 7,456	$ 7,328	$ 7,456

XML

Product Warranty and Safety Recall Campaigns (Tables)

6 Months Ended

Jun. 28, 2015

Product Warranties Disclosures [Abstract]

Warranty And Safety Recall Liability

Changes in the Company’s warranty and recall liability were as follows (in thousands):

	Three months ended						Six months ended
	June 28, 2015			June 29, 2014			June 28, 2015			June 29, 2014
Balance, beginning of period	$	71,073		$	69,336		$	69,250		$	64,120
Warranties issued during the period	21,843			19,824			36,954			37,186
Settlements made during the period	(23,554		)	(16,921		)	(37,119		)	(28,494		)
Recalls and changes to pre-existing warranty liabilities	14,054			3,798			14,331			3,225
Balance, end of period	$	83,416		$	76,037		$	83,416		$	76,037

XML

Subsequent Events Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed (Details) $ in Millions	Aug. 04, 2015 USD ($)
Subsequent Event [Member]
Subsequent Event [Line Items]
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Assets	$ 62

XML

Accumulated Other Comprehensive Income (Changes In Other Comprehensinve Income) (Details) - USD ($) $ in Thousands		3 Months Ended			6 Months Ended
		Jun. 28, 2015	Jun. 29, 2014		Jun. 28, 2015		Jun. 29, 2014
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Balance, beginning of period		$ (522,161)	$ (323,929)		$ (514,943)		$ (332,676)
Other comprehensive (loss) income before reclassifications		3,740	10,735		6,191		11,200
Income tax		307	2,617		(9,354)		(945)
Net other comprehensive (loss) income before reclassifications		3,433	8,118		(3,163)		10,255
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax		(6,031)	(10,735)		(7,018)		21,235
Comprehensive Income (Loss), Reclassifications, Tax		(2,233)	3,975		2,598		(7,865)
Net reclassifications		(3,798)	(6,760)		(4,420)		13,370
Other comprehensive (loss) income		(365)	14,878		(7,583)		23,625
Balance, end of period		(522,526)	(309,051)		(522,526)		(309,051)
Prior Service Costs [Member]
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax		695	684	[1]	(1,390)	[1]	(1,368)	[1]
Actuarial Losses [Member]
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax		(14,670)	(10,323)	[1]	29,340	[1]	20,645	[1]
Foreign Currency Contracts [Member]
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax		20,131	(1,183)	[2]	(35,407)	[2]	2,241	[2]
Commodity Contract [Member]
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax		(125)	87	[2]	439	[2]	(283)	[2]
Accumulated Translation Adjustment [Member]
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Balance, beginning of period		(30,503)	36,274		(3,482)		33,326
Other comprehensive (loss) income before reclassifications		5,040	6,945		(24,951)		8,700
Income tax		789	1,212		2,181		19
Net other comprehensive (loss) income before reclassifications		4,251	5,733		(22,770)		8,681
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax		0	0		0		0
Comprehensive Income (Loss), Reclassifications, Tax		0	0		0		0
Net reclassifications		0	0		0		0
Other comprehensive (loss) income		4,251	5,733		(22,770)		8,681
Balance, end of period		(26,252)	42,007		(26,252)		42,007
Accumulated Net Unrealized Investment Gain (Loss) [Member]
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Balance, beginning of period		(767)	(318)		(700)		(276)
Other comprehensive (loss) income before reclassifications		(204)	(117)		(310)		(184)
Income tax		(76)	(43)		115		(68)
Net other comprehensive (loss) income before reclassifications		(128)	(74)		(195)		(116)
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax		0	0		0		0
Comprehensive Income (Loss), Reclassifications, Tax		0	0		0		0
Net reclassifications		0	0		0		0
Other comprehensive (loss) income		(128)	(74)		(195)		(116)
Balance, end of period		(895)	(392)		(895)		(392)
Accumulated Net Gain (Loss) from Designated or Qualifying Cash Flow Hedges [Member]
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Balance, beginning of period		30,114	(1,907)		19,042		(1,680)
Other comprehensive (loss) income before reclassifications		(1,096)	3,907		31,452		2,684
Income tax		(406)	1,448		(11,650)		(994)
Net other comprehensive (loss) income before reclassifications		(690)	2,459		19,802		1,690
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax		(20,006)	(1,096)		(34,968)		1,958
Comprehensive Income (Loss), Reclassifications, Tax		(7,410)	405		12,952		(725)
Net reclassifications		(12,596)	(691)		(22,016)		1,233
Other comprehensive (loss) income		(13,286)	3,150		(2,214)		2,923
Balance, end of period		16,828	1,243		16,828		1,243
Accumulated Net Gain (Loss) from Designated or Qualifying Cash Flow Hedges [Member] | Foreign Currency Contracts [Member]
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax	[2]	20,131	(1,183)		(35,407)		2,241
Accumulated Net Gain (Loss) from Designated or Qualifying Cash Flow Hedges [Member] | Commodity Contract [Member]
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax	[2]	(125)	87		439		(283)
Accumulated Defined Benefit Plans Adjustment [Member]
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Balance, beginning of period		(521,005)	(357,978)		(529,803)		(364,046)
Other comprehensive (loss) income before reclassifications		0	0		0		0
Income tax		0	0		0		0
Net other comprehensive (loss) income before reclassifications		0	0		0		0
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax		13,975	(9,639)		27,950		19,277
Comprehensive Income (Loss), Reclassifications, Tax		5,177	3,570		(10,354)		(7,140)
Net reclassifications		8,798	(6,069)		17,596		12,137
Other comprehensive (loss) income		8,798	6,069		17,596		12,137
Balance, end of period		(512,207)	(351,909)		(512,207)		(351,909)
Accumulated Defined Benefit Plans Adjustment [Member] | Prior Service Costs [Member]
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax		695	684		(1,390)	[1]	1,368
Accumulated Defined Benefit Plans Adjustment [Member] | Actuarial Losses [Member]
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax		$ (14,670)	$ (10,323)		$ 29,340	[1]	$ (20,645)

[1] Amounts reclassified are included in the computation of net periodic period cost. See Note 14 for information related to pension and postretirement benefit plans.

[2] Amounts reclassified to net income are included in Motorcycles and Related Products cost of goods sold.

XML

Supplemental Consolidating Data (Balance Sheet) (Detail) - USD ($) $ in Thousands	Jun. 28, 2015	Dec. 31, 2014	Jun. 29, 2014	Dec. 31, 2013
Segment Reporting Information [Line Items]
Cash and cash equivalents	$ 1,247,579	$ 906,680	$ 999,346	$ 1,066,612
Available-for-sale Securities, Current	52,516	57,325	57,814
Accounts receivable, net	277,569	247,621	289,940
Finance receivables, net	2,331,723	1,916,635	2,281,512
Inventories	395,044	448,871	371,597
Restricted cash	136,760	98,627	154,681
Deferred Tax Assets, Net, Current	94,778	89,916	90,348
Other current assets	160,421	182,420	128,460
Total current assets	4,696,390	3,948,095	4,373,698
Finance receivables, net	4,816,772	4,516,246	4,537,405
Property, plant and equipment, net	873,007	883,077	826,467
Prepaid Pension Costs	0	0	256,279
Goodwill	26,105	27,752	30,252
Deferred Tax Assets, Net, Noncurrent	66,755	77,835	2,915
Other long-term assets	85,843	75,092	49,280
Total assets	10,564,872	9,528,097	10,076,296
Accounts payable	407,636	196,868	388,342
Accrued liabilities	448,737	449,317	500,769
Short-term debt	114,983	731,786	619,622
Long-term Debt, Current Maturities	1,551,368	1,011,315	944,915
Total current liabilities	2,522,724	2,389,286	2,453,648
Long-term debt	4,560,349	3,761,528	3,794,396
Pension liability	66,786	76,186	38,174
Postretirement healthcare benefits	196,369	203,006	209,312
Deferred Tax Liabilities, Net, Noncurrent	0	0	38,919
Other long-term liabilities	195,017	188,805	175,587
Total shareholders' equity	3,023,627	2,909,286	3,366,260
Total liabilities and shareholders' equity	10,564,872	9,528,097	10,076,296
Motorcycles And Related Products Operations [Member]
Segment Reporting Information [Line Items]
Cash and cash equivalents	828,289	573,895	635,705	718,912
Available-for-sale Securities, Current	52,516	57,325	57,814
Accounts receivable, net	743,341	658,735	1,317,297
Finance receivables, net	0	0	0
Inventories	395,044	448,871	371,597
Restricted cash	0	0	0
Deferred Tax Assets, Net, Current	51,667	50,015	52,348
Other current assets	126,856	142,278
Total current assets	2,197,713	1,931,119	2,530,190
Finance receivables, net	0	0	0
Property, plant and equipment, net	841,361	848,661	792,642
Prepaid Pension Costs			256,279
Goodwill	26,105	27,752	30,252
Deferred Tax Assets, Net, Noncurrent	57,587
Other long-term assets	121,264	113,727
Total assets	3,244,030	2,996,380	3,723,507
Accounts payable	306,335	171,098	316,707
Accrued liabilities	369,467	370,652	423,312
Short-term debt	0	0	0
Long-term Debt, Current Maturities	0	0	0
Total current liabilities	675,802	541,750	740,019
Long-term debt	0	0	0
Pension liability	66,786	76,186	38,174
Postretirement healthcare benefits	196,369	203,006	209,312
Deferred Tax Liabilities, Net, Noncurrent			35,597
Other long-term liabilities	168,043	164,060	152,862
Total shareholders' equity	2,137,030	2,011,378	2,547,543
Total liabilities and shareholders' equity	3,244,030	2,996,380	3,723,507
Financial Services Operations [Member]
Segment Reporting Information [Line Items]
Cash and cash equivalents	419,290	332,785	363,641	347,700
Available-for-sale Securities, Current	0	0	0
Accounts receivable, net	0	0	0
Finance receivables, net	2,331,723	1,916,635	2,281,512
Inventories	0	0	0
Restricted cash	136,760	98,627	154,681
Deferred Tax Assets, Net, Current	43,111	39,901	38,000
Other current assets	40,441	43,125
Total current assets	2,971,325	2,431,073	2,870,865
Finance receivables, net	4,816,772	4,516,246	4,537,405
Property, plant and equipment, net	31,646	34,416	33,825
Prepaid Pension Costs			0
Goodwill	0	0	0
Deferred Tax Assets, Net, Noncurrent	10,861
Other long-term assets	43,842	39,309
Total assets	7,874,446	7,025,907	7,456,601
Accounts payable	567,073	436,884	1,098,992
Accrued liabilities	87,839	83,797	79,205
Short-term debt	114,983	731,786	619,622
Long-term Debt, Current Maturities	1,551,368	1,011,315	944,915
Total current liabilities	2,321,263	2,263,782	2,742,734
Long-term debt	4,560,349	3,761,528	3,794,396
Pension liability	0	0	0
Postretirement healthcare benefits	0	0	0
Deferred Tax Liabilities, Net, Noncurrent			1,574
Other long-term liabilities	26,974	24,745	22,725
Total shareholders' equity	965,860	975,852	895,172
Total liabilities and shareholders' equity	7,874,446	7,025,907	7,456,601
Consolidation, Eliminations [Member]
Segment Reporting Information [Line Items]
Cash and cash equivalents	0	0	0	$ 0
Available-for-sale Securities, Current	0	0	0
Accounts receivable, net	(465,772)	(411,114)	(1,027,357)
Finance receivables, net	0	0	0
Inventories	0	0	0
Restricted cash	0	0	0
Deferred Tax Assets, Net, Current	0	0	0
Other current assets	(6,876)	(2,983)
Total current assets	(472,648)	(414,097)	(1,027,357)
Finance receivables, net	0	0	0
Property, plant and equipment, net	0	0	0
Prepaid Pension Costs			0
Goodwill	0	0	0
Deferred Tax Assets, Net, Noncurrent	(1,693)
Other long-term assets	(79,263)	(77,944)
Total assets	(553,604)	(494,190)	(1,103,812)
Accounts payable	(465,772)	(411,114)	(1,027,357)
Accrued liabilities	(8,569)	(5,132)	(1,748)
Short-term debt	0	0	0
Long-term Debt, Current Maturities	0	0	0
Total current liabilities	(474,341)	(416,246)	(1,029,105)
Long-term debt	0	0	0
Pension liability	0	0	0
Postretirement healthcare benefits	0	0	0
Deferred Tax Liabilities, Net, Noncurrent			1,748
Other long-term liabilities	0	0	0
Total shareholders' equity	(79,263)	(77,944)	(76,455)
Total liabilities and shareholders' equity	$ (553,604)	$ (494,190)	$ (1,103,812)

XML

Finance Receivables (Tables)

6 Months Ended

Jun. 28, 2015

Receivables [Abstract]

Finance Receivables

Finance receivables, net, consisted of the following (in thousands):

	June 28, 2015			December 31, 2014			June 29, 2014
Retail	$	5,962,685		$	5,607,924		$	5,603,187
Wholesale	1,325,041			952,321			1,338,085
	7,287,726			6,560,245			6,941,272
Allowance for credit losses	(139,231		)	(127,364		)	(122,355		)
	$	7,148,495		$	6,432,881		$	6,818,917

Changes In The Allowance For Credit Losses On Finance Receivables

The allowance for credit losses and finance receivables by portfolio, segregated by those amounts that are individually evaluated for impairment and those that are collectively evaluated for impairment, was as follows (in thousands):

	June 28, 2015
	Retail		Wholesale		Total
Allowance for credit losses, ending balance:
Individually evaluated for impairment	$	—	$	—	$	—
Collectively evaluated for impairment	131,903		7,328		139,231
Total allowance for credit losses	$	131,903	$	7,328	$	139,231
Finance receivables, ending balance:
Individually evaluated for impairment	$	—	$	—	$	—
Collectively evaluated for impairment	5,962,685		1,325,041		7,287,726
Total finance receivables	$	5,962,685	$	1,325,041	$	7,287,726
	December 31, 2014
	Retail		Wholesale		Total
Allowance for credit losses, ending balance:
Individually evaluated for impairment	$	—	$	—	$	—
Collectively evaluated for impairment	122,025		5,339		127,364
Total allowance for credit losses	$	122,025	$	5,339	$	127,364
Finance receivables, ending balance:
Individually evaluated for impairment	$	—	$	—	$	—
Collectively evaluated for impairment	5,607,924		952,321		6,560,245
Total finance receivables	$	5,607,924	$	952,321	$	6,560,245
	June 29, 2014
	Retail		Wholesale		Total
Allowance for credit losses, ending balance:
Individually evaluated for impairment	$	—	$	—	$	—
Collectively evaluated for impairment	114,899		7,456		122,355
Total allowance for credit losses	$	114,899	$	7,456	$	122,355
Finance receivables, ending balance:
Individually evaluated for impairment	$	—	$	—	$	—
Collectively evaluated for impairment	5,603,187		1,338,085		6,941,272
Total finance receivables	$	5,603,187	$	1,338,085	$	6,941,272

Changes in the allowance for credit losses on finance receivables by portfolio were as follows (in thousands):

	Three months ended June 28, 2015
	Retail			Wholesale			Total
Balance, beginning of period	$	123,777		$	9,043		$	132,820
Provision for credit losses	16,890			(1,715		)	15,175
Charge-offs	(21,003		)	—			(21,003		)
Recoveries	12,239			—			12,239
Balance, end of period	$	131,903		$	7,328		$	139,231
	Three months ended June 29, 2014
	Retail			Wholesale			Total
Balance, beginning of period	$	106,776		$	7,753		$	114,529
Provision for credit losses	16,258			(297		)	15,961
Charge-offs	(19,018		)	—			(19,018		)
Recoveries	10,883			—			10,883
Balance, end of period	$	114,899		$	7,456		$	122,355
	Six months ended June 28, 2015
	Retail			Wholesale			Total
Balance, beginning of period	$	122,025		$	5,339		$	127,364
Provision for credit losses	39,433			1,989			41,422
Charge-offs	(53,736		)	—			(53,736		)
Recoveries	24,181			—			24,181
Balance, end of period	$	131,903		$	7,328		$	139,231
	Six months ended June 29, 2014
	Retail			Wholesale			Total
Balance, beginning of period	$	106,063		$	4,630		$	110,693
Provision for credit losses	33,466			2,826			36,292
Charge-offs	(46,361		)	—			(46,361		)
Recoveries	21,731			—			21,731
Balance, end of period	$	114,899		$	7,456		$	122,355

Aging Of Past Due Finance Receivables Including Non-Accrual Status Finance Receivables

An analysis of the aging of past due finance receivables was as follows (in thousands):

	June 28, 2015
	Current		31-60 Days Past Due		61-90 Days Past Due		Greater than 90 Days Past Due		Total Past Due		Total Finance Receivables
Retail	$	5,819,279	$	96,982	$	28,150	$	18,274	$	143,406	$	5,962,685
Wholesale	1,324,174		513		181		173		867		1,325,041
Total	$	7,143,453	$	97,495	$	28,331	$	18,447	$	144,273	$	7,287,726
	December 31, 2014
	Current		31-60 Days Past Due		61-90 Days Past Due		Greater than 90 Days Past Due		Total Past Due		Total Finance Receivables
Retail	$	5,427,719	$	113,007	$	38,486	$	28,712	$	180,205	$	5,607,924
Wholesale	951,660		383		72		206		661		952,321
Total	$	6,379,379	$	113,390	$	38,558	$	28,918	$	180,866	$	6,560,245
	June 29, 2014
	Current		31-60 Days Past Due		61-90 Days Past Due		Greater than 90 Days Past Due		Total Past Due		Total Finance Receivables
Retail	$	5,469,796	$	90,617	$	28,088	$	14,686	$	133,391	$	5,603,187
Wholesale	1,337,437		501		113		34		648		1,338,085
Total	$	6,807,233	$	91,118	$	28,201	$	14,720	$	134,039	$	6,941,272

Recorded Investment Of Retail Finance Receivables By Credit Quality Indicator

The recorded investment of retail finance receivables, by credit quality indicator, was as follows (in thousands):

	June 28, 2015		December 31, 2014		June 29, 2014
Prime	$	4,718,363	$	4,435,352	$	4,407,364
Sub-prime	1,244,322		1,172,572		1,195,823
Total	$	5,962,685	$	5,607,924	$	5,603,187

The recorded investment of wholesale finance receivables, by internal credit quality indicator, was as follows (in thousands):

	June 28, 2015		December 31, 2014		June 29, 2014
Doubtful	$	—	$	954	$	4,916
Substandard	7,739		7,025		4,192
Special Mention	15,343		—		—
Medium Risk	3,245		11,557		16,202
Low Risk	1,298,714		932,785		1,312,775
Total	$	1,325,041	$	952,321	$	1,338,085

XML

Asset-Backed Financing (Narrative) (Detail)	3 Months Ended				6 Months Ended
	Jun. 28, 2015 USD ($)	Mar. 29, 2015 USD ($)	Jun. 29, 2014 USD ($)	Mar. 30, 2014 USD ($)	Jun. 28, 2015 USD ($)	Jun. 29, 2015 CAD	Jun. 28, 2015 CAD	Dec. 31, 2014 USD ($)
Secured Notes Through One Term Asset-backed Securitization Transaction [Member] | Secured Debt [Member]
Variable Interest Entity [Line Items]
Company issued secured notes	$ 500,000,000	$ 700,000,000	$ 850,000,000.0		$ 500,000,000
Asset-Backed Canadian Commercial Paper Conduit Facility [Member] | Foreign Line of Credit [Member] | Variable Interest Entity, Not Primary Beneficiary [Member]
Variable Interest Entity [Line Items]
Line of Credit Facility, Current Borrowing Capacity | CAD						CAD 200,000,000	CAD 240,000,000.0
Debt Instrument, Term					5 years
Variable Interest Entity, Reporting Entity Involvement, Maximum Loss Exposure, Amount	26,300,000				$ 26,300,000
Certain Loans Acquired in Transfer Not Accounted for as Debt Securities, Acquired During Period, Contractually Required Payments Receivable at Acquisition	26,800,000	19,200,000	26,400,000	$ 15,700,000
Line of Credit [Member] | Asset-Backed Canadian Commercial Paper Conduit Facility [Member] | Foreign Line of Credit [Member] | Variable Interest Entity, Not Primary Beneficiary [Member]
Variable Interest Entity [Line Items]
Cash Flows Between Transferor and Transferee, Proceeds from New Transfers	23,400,000	$ 16,800,000	23,100,000	$ 13,800,000
Third-party Bank [Member] | Line of Credit [Member] | Asset-Backed U.S. Commercial Paper Conduit Facility VIE [Member] | SPEs [Member]
Variable Interest Entity [Line Items]
Line of Credit Facility, Current Borrowing Capacity	600,000,000				600,000,000
Borrowings outstanding under conduit facility	$ 0		$ 0		$ 0			$ 0

XML

Additional Balance Sheet And Cash Flow Information (Inventories, Net) (Detail) - USD ($) $ in Thousands	Jun. 28, 2015	Dec. 31, 2014	Jun. 29, 2014
Inventory [Line Items]
Raw materials and work in process	$ 137,151	$ 151,254	$ 118,720
Inventory at lower of FIFO cost or market	444,946	498,773	420,323
Excess of FIFO over LIFO cost	(49,902)	(49,902)	(48,726)
Inventories, net	395,044	448,871	371,597
Motorcycle Finished Goods [Member]
Inventory [Line Items]
Finished goods	186,326	230,309	179,314
Parts and Accessories Finished Goods [Member]
Inventory [Line Items]
Finished goods	$ 121,469	$ 117,210	$ 122,289

XML

Supplemental Consolidating Data (Tables)

6 Months Ended

Jun. 28, 2015

Condensed Financial Information of Parent Company Only Disclosure [Abstract]

Operations

	Three months ended June 28, 2015
	Motorcycles & Related Products Operations		Financial Services Operations		Eliminations			Consolidated
Revenue:
Motorcycles and Related Products	$	1,653,759	$	—	$	(2,976	)	$	1,650,783
Financial Services	—		174,147		(538		)	173,609
Total revenue	1,653,759		174,147		(3,514		)	1,824,392
Costs and expenses:
Motorcycles and Related Products cost of goods sold	1,003,569		—		—			1,003,569
Financial Services interest expense	—		41,188		—			41,188
Financial Services provision for credit losses	—		15,175		—			15,175
Selling, administrative and engineering expense	267,149		38,309		(3,514		)	301,944
Total costs and expenses	1,270,718		94,672		(3,514		)	1,361,876
Operating income	383,041		79,475		—			462,516
Investment income	1,450		—		—			1,450
Interest expense	9		—		—			9
Income before provision for income taxes	384,482		79,475		—			463,957
Provision for income taxes	134,633		29,514		—			164,147
Net income	$	249,849	$	49,961	$	—		$	299,810
	Six months ended June 28, 2015
	Motorcycles & Related Products Operations		Financial Services Operations		Eliminations			Consolidated
Revenue:
Motorcycles and Related Products	$	3,166,641	$	—	$	(5,288	)	$	3,161,353
Financial Services	—		336,837		(853		)	335,984
Total revenue	3,166,641		336,837		(6,141		)	3,497,337
Costs and expenses:
Motorcycles and Related Products cost of goods sold	1,923,864		—		—			1,923,864
Financial Services interest expense	—		79,724		—			79,724
Financial Services provision for credit losses	—		41,422		—			41,422
Selling, administrative and engineering expense	512,284		73,550		(6,141		)	579,693
Total costs and expenses	2,436,148		194,696		(6,141		)	2,624,703
Operating income	730,493		142,141		—			872,634
Investment income	102,772		—		(100,000		)	2,772
Interest expense	18		—		—			18
Income before provision for income taxes	833,247		142,141		(100,000		)	875,388
Provision for income taxes	256,149		49,575		—			305,724
Net income	$	577,098	$	92,566	$	(100,000	)	$	569,664

	Three months ended June 29, 2014
	Motorcycles & Related Products Operations		Financial Services Operations		Eliminations			Consolidated
Revenue:
Motorcycles and Related Products	$	1,836,974	$	—	$	(2,689	)	$	1,834,285
Financial Services	—		166,963		(549		)	166,414
Total revenue	1,836,974		166,963		(3,238		)	2,000,699
Costs and expenses:
Motorcycles and Related Products cost of goods sold	1,110,146		—		—			1,110,146
Financial Services interest expense	—		40,741		—			40,741
Financial Services provision for credit losses	—		15,961		—			15,961
Selling, administrative and engineering expense	251,432		37,962		(3,238		)	286,156
Total costs and expenses	1,361,578		94,664		(3,238		)	1,453,004
Operating income	475,396		72,299		—			547,695
Investment income	1,772		—		—			1,772
Interest expense	393		—		—			393
Income before provision for income taxes	476,775		72,299		—			549,074
Provision for income taxes	168,303		26,618		—			194,921
Net income	$	308,472	$	45,681	$	—		$	354,153
	Six months ended June 29, 2014
	Motorcycles & Related Products Operations		Financial Services Operations		Eliminations			Consolidated
Revenue:
Motorcycles and Related Products	$	3,410,941	$	—	$	(4,968	)	$	3,405,973
Financial Services	—		321,649		(875		)	320,774
Total revenue	3,410,941		321,649		(5,843		)	3,726,747
Costs and expenses:
Motorcycles and Related Products cost of goods sold	2,089,703		—		—			2,089,703
Financial Services interest expense	—		79,598		—			79,598
Financial Services provision for credit losses	—		36,292		—			36,292
Selling, administrative and engineering expense	496,197		72,223		(5,843		)	562,577
Total costs and expenses	2,585,900		188,113		(5,843		)	2,768,170
Operating income	825,041		133,536		—			958,577
Investment income	123,431		—		(120,000		)	3,431
Interest expense	4,070		—		—			4,070
Income before provision for income taxes	944,402		133,536		(120,000		)	957,938
Provision for income taxes	288,876		48,992		—			337,868
Net income	$	655,526	$	84,544	$	(120,000	)	$	620,070

Balance Sheet

	June 28, 2015
	Motorcycles & Related Products Operations		Financial Services Operations		Eliminations			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	828,289	$	419,290	$	—		$	1,247,579
Marketable securities	52,516		—		—			52,516
Accounts receivable, net	743,341		—		(465,772		)	277,569
Finance receivables, net	—		2,331,723		—			2,331,723
Inventories	395,044		—		—			395,044
Restricted cash	—		136,760		—			136,760
Deferred income taxes	51,667		43,111		—			94,778
Other current assets	126,856		40,441		(6,876		)	160,421
Total current assets	2,197,713		2,971,325		(472,648		)	4,696,390
Finance receivables, net	—		4,816,772		—			4,816,772
Property, plant and equipment, net	841,361		31,646		—			873,007
Goodwill	26,105		—		—			26,105
Deferred income taxes	57,587		10,861		(1,693		)	66,755
Other long-term assets	121,264		43,842		(79,263		)	85,843
	$	3,244,030	$	7,874,446	$	(553,604	)	$	10,564,872
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	306,335	$	567,073	$	(465,772	)	$	407,636
Accrued liabilities	369,467		87,839		(8,569		)	448,737
Short-term debt	—		114,983		—			114,983
Current portion of long-term debt	—		1,551,368		—			1,551,368
Total current liabilities	675,802		2,321,263		(474,341		)	2,522,724
Long-term debt	—		4,560,349		—			4,560,349
Pension liability	66,786		—		—			66,786
Postretirement healthcare benefits	196,369		—		—			196,369
Other long-term liabilities	168,043		26,974		—			195,017
Shareholders’ equity	2,137,030		965,860		(79,263		)	3,023,627
	$	3,244,030	$	7,874,446	$	(553,604	)	$	10,564,872

	December 31, 2014
	Motorcycles & Related Products Operations		Financial Services Operations		Eliminations			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	573,895	$	332,785	$	—		$	906,680
Marketable securities	57,325		—		—			57,325
Accounts receivable, net	658,735		—		(411,114		)	247,621
Finance receivables, net	—		1,916,635		—			1,916,635
Inventories	448,871		—		—			448,871
Restricted cash	—		98,627		—			98,627
Deferred income taxes	50,015		39,901		—			89,916
Other current assets	142,278		43,125		(2,983		)	182,420
Total current assets	1,931,119		2,431,073		(414,097		)	3,948,095
Finance receivables, net	—		4,516,246		—			4,516,246
Property, plant and equipment, net	848,661		34,416		—			883,077
Goodwill	27,752		—		—			27,752
Deferred income taxes	75,121		4,863		(2,149		)	77,835
Other long-term assets	113,727		39,309		(77,944		)	75,092
	$	2,996,380	$	7,025,907	$	(494,190	)	$	9,528,097
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	171,098	$	436,884	$	(411,114	)	$	196,868
Accrued liabilities	370,652		83,797		(5,132		)	449,317
Short-term debt	—		731,786		—			731,786
Current portion of long-term debt	—		1,011,315		—			1,011,315
Total current liabilities	541,750		2,263,782		(416,246		)	2,389,286
Long-term debt	—		3,761,528		—			3,761,528
Pension liability	76,186		—		—			76,186
Postretirement healthcare benefits	203,006		—		—			203,006
Other long-term liabilities	164,060		24,745		—			188,805
Shareholders’ equity	2,011,378		975,852		(77,944		)	2,909,286
	$	2,996,380	$	7,025,907	$	(494,190	)	$	9,528,097

	June 29, 2014
	Motorcycles & Related Products Operations		Financial Services Operations		Eliminations			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	635,705	$	363,641	$	—		$	999,346
Marketable securities	57,814		—		—			57,814
Accounts receivable, net	1,317,297		—		(1,027,357		)	289,940
Finance receivables, net	—		2,281,512		—			2,281,512
Inventories	371,597		—		—			371,597
Restricted cash	—		154,681		—			154,681
Deferred income taxes	52,348		38,000		—			90,348
Other current assets	95,429		33,031		—			128,460
Total current assets	2,530,190		2,870,865		(1,027,357		)	4,373,698
Finance receivables, net	—		4,537,405		—			4,537,405
Property, plant and equipment, net	792,642		33,825		—			826,467
Prepaid pension costs	256,279		—		—			256,279
Goodwill	30,252		—		—			30,252
Deferred income taxes	2,915		—		—			2,915
Other long-term assets	111,229		14,506		(76,455		)	49,280
	$	3,723,507	$	7,456,601	$	(1,103,812	)	$	10,076,296
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	316,707	$	1,098,992	$	(1,027,357	)	$	388,342
Accrued liabilities	423,312		79,205		(1,748		)	500,769
Short-term debt	—		619,622		—			619,622
Current portion of long-term debt	—		944,915		—			944,915
Total current liabilities	740,019		2,742,734		(1,029,105		)	2,453,648
Long-term debt	—		3,794,396		—			3,794,396
Pension liability	38,174		—		—			38,174
Postretirement healthcare liability	209,312		—		—			209,312
Deferred income taxes	35,597		1,574		1,748			38,919
Other long-term liabilities	152,862		22,725		—			175,587
Shareholders’ equity	2,547,543		895,172		(76,455		)	3,366,260
	$	3,723,507	$	7,456,601	$	(1,103,812	)	$	10,076,296

Cash Flows

	Six months ended June 28, 2015
	Motorcycles & Related Products Operations			Financial Services Operations			Eliminations & Adjustments			Consolidated
Cash flows from operating activities:
Net income	$	577,098		$	92,566		$	(100,000	)	$	569,664
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation	88,996			4,644			—			93,640
Amortization of deferred loan origination costs	—			47,524			—			47,524
Amortization of financing origination fees	—			4,820			—			4,820
Provision for employee long-term benefits	24,635			—			—			24,635
Contributions to pension and postretirement plans	(12,725		)	—			—			(12,725		)
Stock compensation expense	15,415			1,319			—			16,734
Net change in wholesale finance receivables related to sales	—			—			(418,969		)	(418,969		)
Provision for credit losses	—			41,422			—			41,422
Deferred income taxes	5,832			(7,027		)	—			(1,195		)
Foreign currency adjustments	11,041			—			—			11,041
Other, net	(2,671		)	707			—			(1,964		)
Change in current assets and current liabilities:
Accounts receivable	(347,967		)	—			304,658			(43,309		)
Finance receivables—accrued interest and other	—			(270		)	—			(270		)
Inventories	38,012			—			—			38,012
Accounts payable and accrued liabilities	144,784			385,999			(298,426		)	232,357
Derivative instruments	1,185			—			—			1,185
Other	9,625			1,717			—			11,342
Total adjustments	(23,838		)	480,855			(412,737		)	44,280
Net cash provided by operating activities	553,260			573,421			(512,737		)	613,944

	Six months ended June 28, 2015
	Motorcycles & Related Products Operations			Financial Services Operations			Eliminations & Adjustments			Consolidated
Cash flows from investing activities:
Capital expenditures	(83,282		)	(1,898		)	—			(85,180		)
Origination of finance receivables	—			(4,526,313		)	2,549,750			(1,976,563		)
Collections of finance receivables	—			3,707,444			(2,137,013		)	1,570,431
Sales and redemptions of marketable securities	4,500			—			—			4,500
Other	5,111			—			—			5,111
Net cash used by investing activities	(73,671		)	(820,767		)	412,737			(481,701		)
Cash flows from financing activities:
Proceeds from issuance of medium-term notes	—			595,386			—			595,386
Intercompany borrowing activity	250,000			(250,000		)	—			—
Proceeds from securitization debt	—			1,195,668			—			1,195,668
Repayments of securitization debt	—			(454,332		)	—			(454,332		)
Net decrease in credit facilities and unsecured commercial paper	—			(616,586		)	—			(616,586		)
Borrowings of asset-backed commercial paper	—			40,209			—			40,209
Repayments of asset-backed commercial paper	—			(35,730		)	—			(35,730		)
Net change in restricted cash	—			(40,159		)	—			(40,159		)
Dividends paid	(129,745		)	(100,000		)	100,000			(129,745		)
Purchase of common stock for treasury	(358,425		)	—			—			(358,425		)
Excess tax benefits from share-based payments	2,401			—			—			2,401
Issuance of common stock under employee stock option plans	15,664			—			—			15,664
Net cash (used by) provided by financing activities	(220,105		)	334,456			100,000			214,351
Effect of exchange rate changes on cash and cash equivalents	(5,090		)	(605		)	—			(5,695		)
Net increase in cash and cash equivalents	$	254,394		$	86,505		$	—		$	340,899
Cash and cash equivalents:
Cash and cash equivalents—beginning of period	$	573,895		$	332,785		$	—		$	906,680
Net increase in cash and cash equivalents	254,394			86,505			—			340,899
Cash and cash equivalents—end of period	$	828,289		$	419,290		$	—		$	1,247,579

	Six months ended June 29, 2014
	Motorcycles & Related Products Operations			Financial Services Operations			Eliminations & Adjustments			Consolidated
Cash flows from operating activities:
Net income	$	655,526		$	84,544		$	(120,000	)	$	620,070
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation	83,348			3,775			—			87,123
Amortization of deferred loan origination costs	—			45,713						45,713
Amortization of financing origination fees	59			4,225			—			4,284
Provision for employee long-term benefits	16,854			—			—			16,854
Contributions to pension and postretirement plans	(14,035		)	—			—			(14,035		)
Stock compensation expense	19,393			1,375			—			20,768
Net change in wholesale finance receivables related to sales	—			—			(510,200		)	(510,200		)
Provision for credit losses	—			36,292			—			36,292
Loss on extinguishment of debt	—			1,145			—			1,145
Deferred income taxes	(3,894		)	—			—			(3,894		)
Foreign currency adjustments	939			(6,023		)	—			(5,084		)
Other, net	4,712			4,620			—			9,332
Change in current assets and current liabilities:
Accounts receivable	(363,817		)	—			338,174			(25,643		)
Finance receivables—accrued interest and other	—			(993		)	—			(993		)
Inventories	58,741			—			—			58,741
Accounts payable and accrued liabilities	189,117			375,290			(338,174		)	226,233
Derivative instruments	968			—			—			968
Other	4,962			(2,044		)	—			2,918
Total adjustments	(2,653		)	463,375			(510,200		)	(49,478		)
Net cash provided by operating activities	652,873			547,919			(630,200		)	570,592

	Six months ended June 29, 2014
	Motorcycles & Related Products Operations			Financial Services Operations			Eliminations & Adjustments			Consolidated
Cash flows from investing activities:
Capital expenditures	(71,395		)	(3,128		)	—			(74,523		)
Origination of finance receivables	—			(4,580,910		)	2,676,333			(1,904,577		)
Collections of finance receivables	—			3,684,319			(2,166,133		)	1,518,186
Sales and redemptions of marketable securities	41,010			—			—			41,010
Other	145			—			—			145
Net cash used by investing activities	(30,240		)	(899,719		)	510,200			(419,759		)
Cash flows from financing activities:
Repayments of senior unsecured notes	(303,000		)	—			—			(303,000		)
Repayments of medium-term notes	—			(7,220		)	—			(7,220		)
Intercompany borrowing activity	(100,000		)	100,000			—			—
Proceeds from securitization debt	—			847,126			—			847,126
Repayments of securitization debt	—			(393,655		)	—			(393,655		)
Net decrease in credit facilities and unsecured commercial paper	—			(48,134		)	—			(48,134		)
Borrowings of asset-backed commercial paper	—			36,800			—			36,800
Repayments of asset-backed commercial paper	—			(37,317		)	—			(37,317		)
Net change in restricted cash	—			(9,874		)	—			(9,874		)
Dividends paid	(120,631		)	(120,000		)	120,000			(120,631		)
Purchase of common stock for treasury	(223,736		)	—			—			(223,736		)
Excess tax benefits from share-based payments	8,652			—			—			8,652
Issuance of common stock under employee stock option plans	27,907			—			—			27,907
Net cash (used by) provided by financing activities	(710,808		)	367,726			120,000			(223,082		)
Effect of exchange rate changes on cash and cash equivalents	4,968			15			—			4,983
Net (decrease) increase in cash and cash equivalents	$	(83,207	)	$	15,941		$	—		$	(67,266	)
Cash and cash equivalents:
Cash and cash equivalents—beginning of period	$	718,912		$	347,700		$	—		$	1,066,612
Net (decrease) increase in cash and cash equivalents	(83,207		)	15,941			—			(67,266		)
Cash and cash equivalents—end of period	$	635,705		$	363,641		$	—		$	999,346

XML

Fair Value Measurements (Summary Of Assets And Liabilities Measured at Fair Value) (Detail) - USD ($) $ in Thousands	Jun. 28, 2015	Dec. 31, 2014	Jun. 29, 2014
Fair Value, Measurements, Nonrecurring [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Repossessed Assets	$ 13,100	$ 13,400	$ 11,200
Fair Value, Measurements, Recurring [Member] | Balance [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash equivalents	1,030,928	737,024	660,520
Investments, Fair Value Disclosure	90,214	91,140	91,381
Derivative Asset, Current	26,501	32,244	3,159
Assets, Fair Value Disclosure	1,147,643	860,408	755,060
Derivatives, liabilities	986	2,027	1,478
Fair Value, Measurements, Recurring [Member] | Quoted Prices In Active Markets For Identical Assets (Level 1) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash equivalents	558,660	482,686	482,780
Investments, Fair Value Disclosure	37,698	33,815	33,567
Derivative Asset, Current	0	0	0
Assets, Fair Value Disclosure	596,358	516,501	516,347
Derivatives, liabilities	0	0	0
Fair Value, Measurements, Recurring [Member] | Significant Other Observable Inputs (Level 2) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash equivalents	472,268	254,338	177,740
Investments, Fair Value Disclosure	52,516	57,325	57,814
Derivative Asset, Current	26,501	32,244	3,159
Assets, Fair Value Disclosure	551,285	343,907	238,713
Derivatives, liabilities	986	2,027	1,478
Fair Value, Measurements, Recurring [Member] | Significant Unobservable Inputs (Level 3) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash equivalents	0	0	0
Investments, Fair Value Disclosure	0	0	0
Derivative Asset, Current	0	0	0
Assets, Fair Value Disclosure	0	0	0
Derivatives, liabilities	0	0	0
Fair value, adjustment [Domain]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Repossessed Assets	$ 1,900	$ 5,000	$ 2,400

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Business Segments (Information By Strategic Business Units) (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 28, 2015	Jun. 29, 2014	Jun. 28, 2015	Jun. 29, 2014
Segment Reporting Information [Line Items]
Motorcycles net revenue	$ 1,650,783	$ 1,834,285	$ 3,161,353	$ 3,405,973
Selling, administrative and engineering expense	301,944	286,156	579,693	562,577
Financial Services revenue	173,609	166,414	335,984	320,774
Operating income	462,516	547,695	872,634	958,577
Motorcycles [Member]
Segment Reporting Information [Line Items]
Motorcycles net revenue	1,650,783	1,834,285	3,161,353	3,405,973
Gross profit	647,214	724,139	1,237,489	1,316,270
Selling, administrative and engineering expense	266,611	250,883	511,432	495,322
Operating income	380,603	473,256	726,057	820,948
Financial Services [Member]
Segment Reporting Information [Line Items]
Financial Services revenue	173,609	166,414	335,984	320,774
Financial services expense	91,696	91,975	189,407	183,145
Operating income	$ 81,913	$ 74,439	$ 146,577	$ 137,629

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Product Warranty And Safety Recall Campaigns (Warranty And Safety Recall Liability) (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 28, 2015	Jun. 29, 2014	Jun. 28, 2015	Jun. 29, 2014
Movement in Standard Product Warranty Accrual [Roll Forward]
Balance, beginning of period	$ 71,073	$ 69,336	$ 69,250	$ 64,120
Warranties issued during the period	21,843	19,824	36,954	37,186
Settlements made during the period	(23,554)	(16,921)	(37,119)	(28,494)
Recalls and changes to pre-existing warranty liabilities	14,054	3,798	14,331	3,225
Balance, end of period	$ 83,416	$ 76,037	$ 83,416	$ 76,037

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Finance Receivables (Allowance For Credit Losses And Finance Receivables By Portfolio Individually And Collectively Evaluated For Impairment) (Detail) - USD ($)	Jun. 28, 2015	Mar. 29, 2015	Dec. 31, 2014	Jun. 29, 2014	Mar. 30, 2014	Dec. 31, 2013
Financing Receivable, Allowance for Credit Losses [Line Items]
Individually evaluated for impairment	$ 0		$ 0	$ 0
Collectively evaluated for impairment	139,231,000		127,364,000	122,355,000
Total allowance for credit losses	139,231,000	$ 132,820,000	127,364,000	122,355,000	$ 114,529,000	$ 110,693,000
Individually evaluated for impairment	0		0	0
Collectively evaluated for impairment	7,287,726,000		6,560,245,000	6,941,272,000
Total Finance Receivables	7,287,726,000		6,560,245,000	6,941,272,000
Wholesale [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
Individually evaluated for impairment	0		0	0
Collectively evaluated for impairment	7,328,000		5,339,000	7,456,000
Total allowance for credit losses	7,328,000	9,043,000	5,339,000	7,456,000	7,753,000	4,630,000
Individually evaluated for impairment	0		0	0
Collectively evaluated for impairment	1,325,041,000		952,321,000	1,338,085,000
Total Finance Receivables	1,325,041,000		952,321,000	1,338,085,000
Retail [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
Individually evaluated for impairment	0		0	0
Collectively evaluated for impairment	131,903,000		122,025,000	114,899,000
Total allowance for credit losses	131,903,000	$ 123,777,000	122,025,000	114,899,000	$ 106,776,000	$ 106,063,000
Individually evaluated for impairment	0		0	0
Collectively evaluated for impairment	5,962,685,000		5,607,924,000	5,603,187,000
Total Finance Receivables	5,962,685,000		5,607,924,000	5,603,187,000
Nonperforming Financing Receivable [Member] | Wholesale [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
Individually evaluated for impairment	$ 0		$ 0	$ 0

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Finance Receivables

6 Months Ended

Jun. 28, 2015

Receivables [Abstract]

Finance Receivables

Finance Receivables

The Company provides retail financial services to customers of the Company’s independent dealers in the United States and Canada. The origination of retail loans is a separate and distinct transaction between the Company and the retail customer, unrelated to the Company’s sale of product to its dealers. Retail finance receivables consist of secured promissory notes and secured installment sales contracts. The Company holds either titles or liens on titles to vehicles financed by promissory notes and installment sales contracts.

The Company offers wholesale financing to the Company’s independent dealers. Wholesale loans to dealers are generally secured by financed inventory or property and are originated in the U.S. and Canada.

Finance receivables, net, consisted of the following (in thousands):

	June 28, 2015			December 31, 2014			June 29, 2014
Retail	$	5,962,685		$	5,607,924		$	5,603,187
Wholesale	1,325,041			952,321			1,338,085
	7,287,726			6,560,245			6,941,272
Allowance for credit losses	(139,231		)	(127,364		)	(122,355		)
	$	7,148,495		$	6,432,881		$	6,818,917

A provision for credit losses on finance receivables is charged or credited to earnings in amounts that the Company believes are sufficient to maintain the allowance for credit losses at a level that is adequate to cover losses of principal inherent in the existing portfolio. The allowance for credit losses represents management’s estimate of probable losses inherent in the finance receivable portfolio as of the balance sheet date. However, due to the use of projections and assumptions in estimating the losses, the amount of losses actually incurred by the Company could differ from the amounts estimated.

Changes in the allowance for credit losses on finance receivables by portfolio were as follows (in thousands):

	Three months ended June 28, 2015
	Retail			Wholesale			Total
Balance, beginning of period	$	123,777		$	9,043		$	132,820
Provision for credit losses	16,890			(1,715		)	15,175
Charge-offs	(21,003		)	—			(21,003		)
Recoveries	12,239			—			12,239
Balance, end of period	$	131,903		$	7,328		$	139,231
	Three months ended June 29, 2014
	Retail			Wholesale			Total
Balance, beginning of period	$	106,776		$	7,753		$	114,529
Provision for credit losses	16,258			(297		)	15,961
Charge-offs	(19,018		)	—			(19,018		)
Recoveries	10,883			—			10,883
Balance, end of period	$	114,899		$	7,456		$	122,355
	Six months ended June 28, 2015
	Retail			Wholesale			Total
Balance, beginning of period	$	122,025		$	5,339		$	127,364
Provision for credit losses	39,433			1,989			41,422
Charge-offs	(53,736		)	—			(53,736		)
Recoveries	24,181			—			24,181
Balance, end of period	$	131,903		$	7,328		$	139,231
	Six months ended June 29, 2014
	Retail			Wholesale			Total
Balance, beginning of period	$	106,063		$	4,630		$	110,693
Provision for credit losses	33,466			2,826			36,292
Charge-offs	(46,361		)	—			(46,361		)
Recoveries	21,731			—			21,731
Balance, end of period	$	114,899		$	7,456		$	122,355

Finance receivables are considered impaired when management determines it is probable that the Company will be unable to collect all amounts due according to the terms of the loan agreement. Portions of the allowance for credit losses are established to cover estimated losses on finance receivables specifically identified for impairment. The unspecified portion of the allowance for credit losses covers estimated losses on finance receivables which are collectively reviewed for impairment.

The retail portfolio primarily consists of a large number of small balance, homogeneous finance receivables. The Company performs a periodic and systematic collective evaluation of the adequacy of the retail allowance for credit losses. The Company utilizes loss forecast models which consider a variety of factors including, but not limited to, historical loss trends, origination or vintage analysis, known and inherent risks in the portfolio, the value of the underlying collateral, recovery rates, and current economic conditions including items such as unemployment rates. Retail finance receivables are not evaluated individually for impairment prior to charge-off and therefore are not reported as impaired loans.

The wholesale portfolio is primarily composed of large balance, non-homogeneous loans. The Company’s evaluation for the wholesale allowance for credit losses is first based on a loan-by-loan review. A specific allowance for credit losses is established for wholesale finance receivables determined to be individually impaired when management concludes that the borrower will not be able to make full payment of the contractual amounts due based on the original terms of the loan agreement. The impairment is determined based on the cash that the Company expects to receive discounted at the loan’s original interest rate or the fair value of the collateral, if the loan is collateral-dependent. Finance receivables in the wholesale portfolio that are not considered impaired on an individual basis are segregated, based on similar risk characteristics, according to the Company’s internal risk rating system and collectively evaluated for impairment. The related allowance for credit losses is based on factors such as the specific borrower’s financial performance and ability to repay, the Company’s past loan loss experience, current economic conditions, and the value of the underlying collateral.

Generally, it is the Company’s policy not to change the terms and conditions of finance receivables. However, to minimize the economic loss, the Company may modify certain finance receivables in troubled debt restructurings. Total restructured finance receivables are not significant.

The allowance for credit losses and finance receivables by portfolio, segregated by those amounts that are individually evaluated for impairment and those that are collectively evaluated for impairment, was as follows (in thousands):

	June 28, 2015
	Retail		Wholesale		Total
Allowance for credit losses, ending balance:
Individually evaluated for impairment	$	—	$	—	$	—
Collectively evaluated for impairment	131,903		7,328		139,231
Total allowance for credit losses	$	131,903	$	7,328	$	139,231
Finance receivables, ending balance:
Individually evaluated for impairment	$	—	$	—	$	—
Collectively evaluated for impairment	5,962,685		1,325,041		7,287,726
Total finance receivables	$	5,962,685	$	1,325,041	$	7,287,726
	December 31, 2014
	Retail		Wholesale		Total
Allowance for credit losses, ending balance:
Individually evaluated for impairment	$	—	$	—	$	—
Collectively evaluated for impairment	122,025		5,339		127,364
Total allowance for credit losses	$	122,025	$	5,339	$	127,364
Finance receivables, ending balance:
Individually evaluated for impairment	$	—	$	—	$	—
Collectively evaluated for impairment	5,607,924		952,321		6,560,245
Total finance receivables	$	5,607,924	$	952,321	$	6,560,245
	June 29, 2014
	Retail		Wholesale		Total
Allowance for credit losses, ending balance:
Individually evaluated for impairment	$	—	$	—	$	—
Collectively evaluated for impairment	114,899		7,456		122,355
Total allowance for credit losses	$	114,899	$	7,456	$	122,355
Finance receivables, ending balance:
Individually evaluated for impairment	$	—	$	—	$	—
Collectively evaluated for impairment	5,603,187		1,338,085		6,941,272
Total finance receivables	$	5,603,187	$	1,338,085	$	6,941,272

There were no wholesale finance receivables at June 28, 2015, December 31, 2014, or June 29, 2014 that were individually deemed to be impaired under ASC Topic 310, “Receivables.”

Retail finance receivables are contractually delinquent if the minimum payment is not received by the specified due date. Retail finance receivables are generally charged-off when the receivable is 120 days or more delinquent, the related asset is repossessed or the receivable is otherwise deemed uncollectible. All retail finance receivables accrue interest until either collected or charged-off. Accordingly, as of June 28, 2015, December 31, 2014 and June 29, 2014, all retail finance receivables were accounted for as interest-earning receivables, of which $18.3 million, $28.7 million and $14.7 million, respectively, were 90 days or more past due.

Wholesale finance receivables are delinquent if the minimum payment is not received by the contractual due date. Interest continues to accrue on past due finance receivables until the date the finance receivable becomes uncollectible and the finance receivable is placed on non-accrual status. The Company will resume accruing interest on these accounts when payments are current according to the terms of the loans and future payments are reasonably assured. While on non-accrual status, all cash received is applied to principal or interest as appropriate. Wholesale finance receivables are written down once management determines that the specific borrower does not have the ability to repay the loan in full. There were no wholesale receivables on non-accrual status at June 28, 2015, December 31, 2014 or June 29, 2014. At June 28, 2015, December 31, 2014 and June 29, 2014, $0.2 million, $0.2 million, and $0.03 million of wholesale finance receivables were 90 days or more past due and accruing interest, respectively.

An analysis of the aging of past due finance receivables was as follows (in thousands):

	June 28, 2015
	Current		31-60 Days Past Due		61-90 Days Past Due		Greater than 90 Days Past Due		Total Past Due		Total Finance Receivables
Retail	$	5,819,279	$	96,982	$	28,150	$	18,274	$	143,406	$	5,962,685
Wholesale	1,324,174		513		181		173		867		1,325,041
Total	$	7,143,453	$	97,495	$	28,331	$	18,447	$	144,273	$	7,287,726
	December 31, 2014
	Current		31-60 Days Past Due		61-90 Days Past Due		Greater than 90 Days Past Due		Total Past Due		Total Finance Receivables
Retail	$	5,427,719	$	113,007	$	38,486	$	28,712	$	180,205	$	5,607,924
Wholesale	951,660		383		72		206		661		952,321
Total	$	6,379,379	$	113,390	$	38,558	$	28,918	$	180,866	$	6,560,245
	June 29, 2014
	Current		31-60 Days Past Due		61-90 Days Past Due		Greater than 90 Days Past Due		Total Past Due		Total Finance Receivables
Retail	$	5,469,796	$	90,617	$	28,088	$	14,686	$	133,391	$	5,603,187
Wholesale	1,337,437		501		113		34		648		1,338,085
Total	$	6,807,233	$	91,118	$	28,201	$	14,720	$	134,039	$	6,941,272

A significant part of managing the Company's finance receivable portfolios includes the assessment of credit risk associated with each borrower. As the credit risk varies between the retail and wholesale portfolios, the Company utilizes different credit risk indicators for each portfolio.

The Company manages retail credit risk through its credit approval policy and ongoing collection efforts. The Company uses FICO scores, a standard credit rating measurement, to differentiate the expected default rates of retail credit applicants enabling the Company to better evaluate credit applicants for approval and to tailor pricing according to this assessment. Retail loans with a FICO score of 640 or above at origination are considered prime, and loans with a FICO score below 640 are considered sub-prime. These credit quality indicators are determined at the time of loan origination and are not updated subsequent to the loan origination date.

The recorded investment of retail finance receivables, by credit quality indicator, was as follows (in thousands):

	June 28, 2015		December 31, 2014		June 29, 2014
Prime	$	4,718,363	$	4,435,352	$	4,407,364
Sub-prime	1,244,322		1,172,572		1,195,823
Total	$	5,962,685	$	5,607,924	$	5,603,187

The Company's credit risk on the wholesale portfolio is different from that of the retail portfolio. Whereas the retail portfolio represents a relatively homogeneous pool of retail finance receivables that exhibit more consistent loss patterns, the wholesale portfolio exposures are less consistent. The Company utilizes an internal credit risk rating system to manage credit risk exposure consistently across wholesale borrowers and individually evaluates credit risk factors for each borrower.

The Company uses the following internal credit quality indicators, based on an internal risk rating system, listed from highest level of risk to lowest level of risk for the wholesale portfolio: Doubtful, Substandard, Special Mention, Medium Risk and Low Risk. Based upon management’s review, the dealers classified in the Doubtful category are the dealers with the greatest likelihood of being charged off, while the dealers classified as Low Risk are least likely to be charged off. The internal rating system considers factors such as the specific borrowers’ ability to repay and the estimated value of any collateral. Dealer risk rating classifications are reviewed and updated on a quarterly basis.

The recorded investment of wholesale finance receivables, by internal credit quality indicator, was as follows (in thousands):

	June 28, 2015		December 31, 2014		June 29, 2014
Doubtful	$	—	$	954	$	4,916
Substandard	7,739		7,025		4,192
Special Mention	15,343		—		—
Medium Risk	3,245		11,557		16,202
Low Risk	1,298,714		932,785		1,312,775
Total	$	1,325,041	$	952,321	$	1,338,085

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Product Warranty And Safety Recall Campaigns (Narrative) (Detail) - USD ($) $ in Millions	6 Months Ended
	Jun. 28, 2015	Dec. 31, 2014	Jun. 29, 2014
Motorcycles [Member]
Product Information [Line Items]
Standard product warranty, period	2 years
Parts and Accessories Finished Goods [Member]
Product Information [Line Items]
Standard product warranty, period	1 year
Japan [Member] | Motorcycles [Member]
Product Information [Line Items]
Standard product warranty, period	3 years
Safety Recall [Member]
Product Information [Line Items]
Liability for safety recall campaigns	$ 16.6	$ 9.8	$ 6.8

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Additional Balance Sheet And Cash Flow Information (Reconciliation Of Net Income To Net Cash Used By Operating Activities) (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 28, 2015	Jun. 29, 2014	Jun. 28, 2015	Jun. 29, 2014
Cash flows from operating activities:
Net income	$ 299,810	$ 354,153	$ 569,664	$ 620,070
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation			93,640	87,123
Amortization of deferred loan origination costs			47,524	45,713
Amortization of financing origination fees			4,820	4,284
Provision for employee long-term benefits			24,635	16,854
Contributions to pension and postretirement plans			(12,725)	(14,035)
Stock compensation expense			16,734	20,768
Net change in wholesale finance receivables related to sales			(418,969)	(510,200)
Provision for credit losses	$ 15,175	$ 15,961	41,422	36,292
Gains (Losses) on Extinguishment of Debt			0	(1,145)
Deferred Income Taxes and Tax Credits			(1,195)	(3,894)
Foreign currency adjustments			11,041	(5,084)
Other, net			(1,964)	9,332
Changes in current assets and liabilities:
Accounts receivable, net			(43,309)	(25,643)
Finance receivables-accrued interest and other			(270)	(993)
Inventories			38,012	58,741
Accounts payable and accrued liabilities			232,357	226,233
Derivative instruments			1,185	968
Other			11,342	2,918
Total adjustments			44,280	(49,478)
Net cash provided by operating activities			$ 613,944	$ 570,592

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Derivative Instruments and Hedging Activities (Tables)

6 Months Ended

Jun. 28, 2015

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Instrument Fair Value

The following table summarizes the fair value of the Company’s derivative financial instruments (in thousands):

	June 28, 2015						December 31, 2014						June 29, 2014
Derivatives Designated As Hedging Instruments Under ASC Topic 815	Notional Value		Asset Fair  Value(a)		Liability Fair  Value(b)		Notional Value		Asset Fair  Value(a)		Liability Fair  Value(b)		Notional Value		Asset Fair  Value(a)		Liability Fair  Value(b)
Foreign currency contracts(c)	$	367,309	$	23,136	$	—	$	339,077	$	32,244	$	—	$	398,338	$	3,091	$	1,461
Commodity contracts(c)	1,166		—		98		1,728		—		414		1,411		—		17
Treasury rate locks(c)	300,000		3,365		—		—		—		—		—		—		—
Total	$	668,475	$	26,501	$	98	$	340,805	$	32,244	$	414	$	399,749	$	3,091	$	1,478
	June 28, 2015						December 31, 2014						June 29, 2014
Derivatives Not Designated As Hedging Instruments Under ASC Topic 815	Notional Value		Asset Fair  Value(a)		Liability Fair  Value(b)		Notional Value		Asset Fair  Value(a)		Liability Fair  Value(b)		Notional Value		Asset Fair  Value(a)		Liability Fair  Value(b)
Commodity contracts	$	8,218	$	—	$	888	$	11,804	$	—	$	1,613	$	7,754	$	68	$	—
	$	8,218	$	—	$	888	$	11,804	$	—	$	1,613	$	7,754	$	68	$	—

(a) Foreign currency and commodity contract fair value included in other current assets and Treasury rate lock fair value included in other long-term assets

(b) Included in accrued liabilities

(c) Derivative designated as a cash flow hedge

Schedule of Cash Flow Hedges Included in Accumulated Other Comprehensive Income (Loss)

The following tables summarize the amount of gains and losses related to derivative financial instruments designated as cash flow hedges (in thousands):

	Amount of Gain/(Loss) Recognized in OCI, before tax
	Three months ended						Six months ended
Cash Flow Hedges	June 28, 2015			June 29, 2014			June 28, 2015			June 29, 2014
Foreign currency contracts	$	(4,458	)	$	3,931		$	28,210		$	2,493
Commodity contracts	(3		)	(24		)	(123		)	191
Treasury rate locks	3,365			—			3,365			—
Total	$	(1,096	)	$	3,907		$	31,452		$	2,684

	Amount of Gain/(Loss) Reclassified from AOCL into Income
	Three months ended						Six months ended						Expected to be Reclassified
Cash Flow Hedges	June 28, 2015			June 29, 2014			June 28, 2015			June 29, 2014			Over the Next Twelve Months
Foreign currency contracts(a)	$	20,131		$	(1,183	)	$	35,407		$	(2,241	)	$	23,461
Commodity contracts(a)	(125		)	87			(439		)	283			(98		)
Treasury rate locks(b)	—			—			—			—			191
Total	$	20,006		$	(1,096	)	$	34,968		$	(1,958	)	$	23,554

(a) Gain/(loss) reclassified from accumulated other comprehensive loss (AOCL) to income is included in cost of goods sold

(b) Gain/(loss) reclassified from accumulated other comprehensive loss (AOCL) to income will be included in interest expense

For the three and six months ended June 28, 2015 and June 29, 2014, the cash flow hedges were highly effective and, as a result, the amount of hedge ineffectiveness was not material. No amounts were excluded from effectiveness testing.

Schedule of Other Derivatives Not Designated as Hedging Instruments, Statements of Financial Performance and Financial Position, Location

The following tables summarize the amount of gains and losses related to derivative financial instruments not designated as hedging instruments (in thousands):

	Amount of Gain/(Loss) Recognized in Income on Derivative
	Three months ended				Six months ended
Derivatives Not Designated As Hedges	June 28, 2015		June 29, 2014		June 28, 2015			June 29, 2014
Commodity contracts(a)	$	14	$	184	$	(526	)	$	(144	)
Total	$	14	$	184	$	(526	)	$	(144	)

(a) Gain/(loss) recognized in income is included in cost of goods sold.

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Fair Value of Financial Instruments (Tables)

6 Months Ended

Jun. 28, 2015

Fair Value Disclosures [Abstract]

Summary Of The Fair Value And Carrying Value Of The Company's Financial Instruments

The following table summarizes the fair value and carrying value of the Company’s financial instruments (in thousands):

	June 28, 2015				December 31, 2014				June 29, 2014
	Fair Value		Carrying Value		Fair Value		Carrying Value		Fair Value		Carrying Value
Assets:
Cash and cash equivalents	$	1,247,579	$	1,247,579	$	906,680	$	906,680	$	999,346	$	999,346
Marketable securities	$	90,214	$	90,214	$	91,140	$	91,140	$	91,381	$	91,381
Derivatives	$	26,501	$	26,501	$	32,244	$	32,244	$	3,159	$	3,159
Finance receivables, net	$	7,251,671	$	7,148,495	$	6,519,500	$	6,432,881	$	6,917,698	$	6,818,917
Restricted cash	$	162,211	$	162,211	$	122,052	$	122,052	$	154,681	$	154,681
Liabilities:
Derivatives	$	986	$	986	$	2,027	$	2,027	$	1,478	$	1,478
Unsecured commercial paper	$	114,983	$	114,983	$	731,786	$	731,786	$	619,622	$	619,622
Asset-backed Canadian commercial paper conduit facility	$	160,940	$	160,940	$	166,912	$	166,912	$	173,224	$	173,224
Medium-term notes	$	4,077,952	$	3,933,698	$	3,502,536	$	3,334,398	$	3,049,735	$	2,853,232
Term asset-backed securitization debt	$	2,016,232	$	2,017,079	$	1,270,656	$	1,271,533	$	1,717,287	$	1,712,855

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Derivative Instruments And Hedging Activities (Gain Loss On Derivative Cash Flow Hedges Reclassified From AOCI Into Income) (Detail) - USD ($) $ in Thousands		3 Months Ended		6 Months Ended
		Jun. 28, 2015	Jun. 29, 2014	Jun. 28, 2015	Jun. 29, 2014
Cash Flow Hedging [Member]
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Amount of Gain/(Loss) Reclassified from AOCI into Income		$ 20,006	$ (1,096)	$ 34,968	$ (1,958)
Expected to be Reclassified Over the Next Twelve Months		23,554
Cash Flow Hedging [Member] | Foreign Currency Contracts [Member]
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Amount of Gain/(Loss) Reclassified from AOCI into Income	[1]	20,131	(1,183)	35,407	(2,241)
Expected to be Reclassified Over the Next Twelve Months	[1]	23,461
Cash Flow Hedging [Member] | Commodity Contract [Member]
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Amount of Gain/(Loss) Reclassified from AOCI into Income	[1]	(125)	87	(439)	283
Expected to be Reclassified Over the Next Twelve Months	[1]	(98)
Cash Flow Hedging [Member] | Interest Rate Lock Commitments [Member]
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Amount of Gain/(Loss) Reclassified from AOCI into Income	[1]	0	0	0	0
Expected to be Reclassified Over the Next Twelve Months	[1]	191
Not Designated as Hedging Instrument [Member]
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Derivative Instruments Not Designated as Hedging Instruments, Loss		14	184	(526)	(144)
Not Designated as Hedging Instrument [Member] | Commodity Contract [Member]
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Derivative Instruments Not Designated as Hedging Instruments, Loss	[2]	$ 14	$ 184	$ (526)	$ (144)

[1] Gain/(loss) reclassified from accumulated other comprehensive loss (AOCL) to income is included in cost of goods sold

[2] (a)Gain/(loss) recognized in income is included in cost of goods sold.

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Finance Receivables (Finance Receivables) (Detail) - USD ($) $ in Thousands	Jun. 28, 2015	Mar. 29, 2015	Dec. 31, 2014	Jun. 29, 2014	Mar. 30, 2014	Dec. 31, 2013
Accounts, Notes, Loans and Financing Receivable [Line Items]
Financing Receivable, Gross	$ 7,287,726		$ 6,560,245	$ 6,941,272
Allowance for credit losses	(139,231)	$ (132,820)	(127,364)	(122,355)	$ (114,529)	$ (110,693)
Total Finance Receivables, Net	7,148,495		6,432,881	6,818,917
Retail [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Financing Receivable, Gross	5,962,685		5,607,924	5,603,187
Allowance for credit losses	(131,903)	(123,777)	(122,025)	(114,899)	(106,776)	(106,063)
Wholesale [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Financing Receivable, Gross	1,325,041		952,321	1,338,085
Allowance for credit losses	$ (7,328)	$ (9,043)	$ (5,339)	$ (7,456)	$ (7,753)	$ (4,630)

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Accumulated Other Comprehensive Income (Tables)

6 Months Ended

Jun. 28, 2015

Equity [Abstract]

Schedule of Accumulated Other Comprehensive Income (Loss)

The following tables set forth the changes in accumulated other comprehensive loss (AOCL) (in thousands):

	Three months ended June 28, 2015
	Foreign currency translation adjustments			Marketable securities			Derivative financial instruments			Pension and postretirement benefit plans			Total
Balance, beginning of period	$	(30,503	)	$	(767	)	$	30,114		$	(521,005	)	$	(522,161	)
Other comprehensive income (loss) before reclassifications	5,040			(204		)	(1,096		)	—			3,740
Income tax	(789		)	76			406			—			(307		)
Net other comprehensive income (loss) before reclassifications	4,251			(128		)	(690		)	—			3,433
Reclassifications:
Realized (gains) losses - foreign currency contracts(a)	—			—			(20,131		)	—			(20,131		)
Realized (gains) losses - commodities contracts(a)	—			—			125			—			125
Prior service credits(b)	—			—			—			(695		)	(695		)
Actuarial losses(b)	—			—			—			14,670			14,670
Total before tax	—			—			(20,006		)	13,975			(6,031		)
Income tax expense (benefit)	—			—			7,410			(5,177		)	2,233
Net reclassifications	—			—			(12,596		)	8,798			(3,798		)
Other comprehensive income (loss)	4,251			(128		)	(13,286		)	8,798			(365		)
Balance, end of period	$	(26,252	)	$	(895	)	$	16,828		$	(512,207	)	$	(522,526	)
	Three months ended June 29, 2014
	Foreign currency translation adjustments			Marketable securities			Derivative financial instruments			Pension and postretirement benefit plans			Total
Balance, beginning of period	$	36,274		$	(318	)	$	(1,907	)	$	(357,978	)	$	(323,929	)
Other comprehensive income (loss) before reclassifications	6,945			(117		)	3,907			—			10,735
Income tax	(1,212		)	43			(1,448		)	—			(2,617		)
Net other comprehensive income (loss) before reclassifications	5,733			(74		)	2,459			—			8,118
Reclassifications:
Realized (gains) losses - foreign currency contracts(a)	—			—			1,183			—			1,183
Realized (gains) losses - commodities contracts(a)	—			—			(87		)	—			(87		)
Prior service credits(b)	—			—			—			(684		)	(684		)
Actuarial losses(b)	—			—			—			10,323			10,323
Total before tax	—			—			1,096			9,639			10,735
Income tax benefit	—			—			(405		)	(3,570		)	(3,975		)
Net reclassifications	—			—			691			6,069			6,760
Other comprehensive income (loss)	5,733			(74		)	3,150			6,069			14,878
Balance, end of period	$	42,007		$	(392	)	$	1,243		$	(351,909	)	$	(309,051	)

	Six months ended June 28, 2015
	Foreign currency translation adjustments			Marketable securities			Derivative financial instruments			Pension and postretirement benefit plans			Total
Balance, beginning of period	$	(3,482	)	$	(700	)	$	19,042		$	(529,803	)	$	(514,943	)
Other comprehensive (loss) income before reclassifications	(24,951		)	(310		)	31,452			—			6,191
Income tax	2,181			115			(11,650		)	—			(9,354		)
Net other comprehensive (loss) income before reclassifications	(22,770		)	(195		)	19,802			—			(3,163		)
Reclassifications:
Realized (gains) losses - foreign currency contracts(a)	—			—			(35,407		)	—			(35,407		)
Realized (gains) losses - commodities contracts(a)	—			—			439			—			439
Prior service credits(b)	—			—			—			(1,390		)	(1,390		)
Actuarial losses(b)	—			—			—			29,340			29,340
Total before tax	—			—			(34,968		)	27,950			(7,018		)
Income tax expense (benefit)	—			—			12,952			(10,354		)	2,598
Net reclassifications	—			—			(22,016		)	17,596			(4,420		)
Other comprehensive (loss) income	(22,770		)	(195		)	(2,214		)	17,596			(7,583		)
Balance, end of period	$	(26,252	)	$	(895	)	$	16,828		$	(512,207	)	$	(522,526	)
	Six months ended June 29, 2014
	Foreign currency translation adjustments			Marketable securities			Derivative financial instruments			Pension and postretirement benefit plans			Total
Balance, beginning of period	$	33,326		$	(276	)	$	(1,680	)	$	(364,046	)	$	(332,676	)
Other comprehensive income (loss) before reclassifications	8,700			(184		)	2,684			—			11,200
Income tax	(19		)	68			(994		)	—			(945		)
Net other comprehensive income (loss) before reclassifications	8,681			(116		)	1,690			—			10,255
Reclassifications:
Realized (gains) losses - foreign currency contracts(a)	—			—			2,241			—			2,241
Realized (gains) losses - commodities contracts(a)	—			—			(283		)	—			(283		)
Prior service credits(b)	—			—			—			(1,368		)	(1,368		)
Actuarial losses(b)	—			—			—			20,645			20,645
Total before tax	—			—			1,958			19,277			21,235
Income tax benefit	—			—			(725		)	(7,140		)	(7,865		)
Net reclassifications	—			—			1,233			12,137			13,370
Other comprehensive income (loss)	8,681			(116		)	2,923			12,137			23,625
Balance, end of period	$	42,007		$	(392	)	$	1,243		$	(351,909	)	$	(309,051	)

(a) Amounts reclassified to net income are included in Motorcycles and Related Products cost of goods sold.

(b) Amounts reclassified are included in the computation of net periodic period cost. See Note 14 for information related to pension and postretirement benefit plans.

XML

Debt Debt (Tables)

6 Months Ended

Jun. 28, 2015

Debt Disclosure [Abstract]

Schedule of Long-term Debt Instruments [Table Text Block]

Debt with a contractual term greater than one year is generally classified as long-term debt and consisted of the following (in thousands):

	June 28, 2015			December 31, 2014			June 29, 2014
Secured debt
Asset-backed Canadian commercial paper conduit facility	$	160,940		$	166,912		$	173,224
Term asset-backed securitization debt	2,017,079			1,271,533			1,712,855
Unsecured notes
5.75% Medium-term notes due in 2014 ($500.0 million par value)	—			—			499,946
1.15% Medium-term notes due in 2015 ($600.0 million par value)	599,954			599,817			599,680
3.88% Medium-term notes due in 2016 ($450.0 million par value)	449,964			449,937			449,910
2.70% Medium-term notes due in 2017 ($400.0 million par value)	399,972			399,963			399,955
1.55% Medium-term notes due in 2017 ($400.0 million par value)	399,557			399,464			—
6.80% Medium-term notes due in 2018 ($888.0 million par value)	887,467			887,381			903,741
2.40% Medium-term notes due in 2019 ($600.0 million par value)	598,066			597,836			—
2.15% Medium-term notes due in 2020 ($600.0 million par value)	598,718			—			—
Gross long-term debt	6,111,717			4,772,843			4,739,311
Less: current portion of long-term debt	(1,551,368		)	(1,011,315		)	(944,915		)
Long-term debt	$	4,560,349		$	3,761,528		$	3,794,396

XML

Additional Balance Sheet and Cash Flow Information

6 Months Ended

Jun. 28, 2015

Supplemental Cash Flow Information [Abstract]

Additional Balance Sheet and Cash Flow Information

Additional Balance Sheet and Cash Flow Information

Marketable Securities

The Company’s marketable securities consisted of the following (in thousands):

	June 28, 2015		December 31, 2014		June 29, 2014
Available-for-sale: Corporate bonds	$	52,516	$	57,325	$	57,814
Trading securities: Mutual funds	37,698		33,815		33,567
	$	90,214	$	91,140	$	91,381

The Company’s available-for-sale securities are carried at fair value with any unrealized gains or losses reported in other comprehensive income. During the first half of 2015 and 2014, the Company recognized gross unrealized losses of approximately $310,000 and $184,000, respectively, or $195,000 and $116,000 net of taxes, respectively, to adjust amortized cost to fair value. The marketable securities have contractual maturities that generally come due over the next 3 to 22 months.

The Company's trading securities relate to investments held by the Company to fund certain deferred compensation obligations. The trading securities are carried at fair value with gains and losses recorded in net income and investments are included in other long-term assets on the consolidated balance sheets.

Inventories

Inventories are valued at the lower of cost or market. Substantially all inventories located in the United States are valued using the last-in, first-out (LIFO) method. Other inventories are valued at the lower of cost or market using the first-in, first-out (FIFO) method. Inventories consist of the following (in thousands):

	June 28, 2015			December 31, 2014			June 29, 2014
Components at the lower of FIFO cost or market
Raw materials and work in process	$	137,151		$	151,254		$	118,720
Motorcycle finished goods	186,326			230,309			179,314
Parts and accessories and general merchandise	121,469			117,210			122,289
Inventory at lower of FIFO cost or market	444,946			498,773			420,323
Excess of FIFO over LIFO cost	(49,902		)	(49,902		)	(48,726		)
	$	395,044		$	448,871		$	371,597

Operating Cash Flow

The reconciliation of net income to net cash provided by operating activities is as follows (in thousands):

	Six months ended
	June 28, 2015			June 29, 2014
Cash flows from operating activities:
Net income	$	569,664		$	620,070
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation	93,640			87,123
Amortization of deferred loan origination costs	47,524			45,713
Amortization of financing origination fees	4,820			4,284
Provision for employee long-term benefits	24,635			16,854
Contributions to pension and postretirement plans	(12,725		)	(14,035		)
Stock compensation expense	16,734			20,768
Net change in wholesale finance receivables related to sales	(418,969		)	(510,200		)
Provision for credit losses	41,422			36,292
Loss on debt extinguishment	—			1,145
Deferred income taxes	(1,195		)	(3,894		)
Foreign currency adjustments	11,041			(5,084		)
Other, net	(1,964		)	9,332
Changes in current assets and liabilities:
Accounts receivable, net	(43,309		)	(25,643		)
Finance receivables—accrued interest and other	(270		)	(993		)
Inventories	38,012			58,741
Accounts payable and accrued liabilities	232,357			226,233
Derivative instruments	1,185			968
Other	11,342			2,918
Total adjustments	44,280			(49,478		)
Net cash provided by operating activities	$	613,944		$	570,592

XML

Debt Schedule of Short-Term Debt (Tables)

6 Months Ended

Jun. 28, 2015

Debt Disclosure [Abstract]

Schedule of Short-term Debt [Table Text Block]

Debt with contractual terms less than one year is generally classified as short-term debt and consisted of the following (in thousands):

	June 28, 2015		December 31, 2014		June 29, 2014
Unsecured commercial paper	$	114,983	$	731,786	$	619,622

XML

Additional Balance Sheet And Cash Flow Information (Marketable Securities) (Detail) - USD ($) $ in Thousands	Jun. 28, 2015	Dec. 31, 2014	Jun. 29, 2014
Supplemental Cash Flow Information [Abstract]
Available-for-sale securities	$ 52,516	$ 57,325	$ 57,814
Trading Securities	37,698	33,815	33,567
Marketable Securities	$ 90,214	$ 91,140	$ 91,381

XML

Fair Value Of Financial Instruments (Summary Of Fair Value And Carrying Value Of Company Financial Instruments) (Detail) - USD ($) $ in Thousands	Jun. 28, 2015	Dec. 31, 2014	Jun. 29, 2014
Assets:
Restricted cash	$ 136,760	$ 98,627	$ 154,681
Fair Value [Member]
Assets:
Cash equivalents	1,247,579	906,680	999,346
Marketable securities	90,214	91,140	91,381
Derivatives	26,501	32,244	3,159
Finance receivables, net	7,251,671	6,519,500	6,917,698
Restricted cash	162,211	122,052	154,681
Liabilities:
Derivatives	986	2,027	1,478
Carrying Value [Member]
Assets:
Cash equivalents	1,247,579	906,680	999,346
Marketable securities	90,214	91,140	91,381
Derivatives	26,501	32,244	3,159
Finance receivables, net	7,148,495	6,432,881	6,818,917
Restricted cash	162,211	122,052	154,681
Liabilities:
Derivatives	986	2,027	1,478
Unsecured Commercial Paper [Member] | Fair Value [Member]
Liabilities:
Debt Instrument, Fair Value Disclosure	114,983	731,786	619,622
Unsecured Commercial Paper [Member] | Carrying Value [Member]
Liabilities:
Debt Instrument, Fair Value Disclosure	114,983	731,786	619,622
Asset-Backed Canadian Commercial Paper Conduit Facility [Member] | Fair Value [Member]
Liabilities:
Debt Instrument, Fair Value Disclosure	160,940	166,912	173,224
Asset-Backed Canadian Commercial Paper Conduit Facility [Member] | Carrying Value [Member]
Liabilities:
Debt Instrument, Fair Value Disclosure	160,940	166,912	173,224
Medium-term Notes [Member] | Fair Value [Member]
Liabilities:
Debt Instrument, Fair Value Disclosure	4,077,952	3,502,536	3,049,735
Medium-term Notes [Member] | Carrying Value [Member]
Liabilities:
Debt Instrument, Fair Value Disclosure	3,933,698	3,334,398	2,853,232
Secured Debt [Member] | Fair Value [Member]
Liabilities:
Debt Instrument, Fair Value Disclosure	2,016,232	1,270,656	1,717,287
Secured Debt [Member] | Carrying Value [Member]
Liabilities:
Debt Instrument, Fair Value Disclosure	$ 2,017,079	$ 1,271,533	$ 1,712,855

XML

Supplemental Consolidating Data (Cash Flows) (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 28, 2015	Jun. 29, 2014	Jun. 28, 2015	Jun. 29, 2014
Segment Reporting Information [Line Items]
Repayments of Medium-term Notes			$ 0	$ (7,220)
Deferred Income Taxes and Tax Credits			(1,195)	(3,894)
Cash flows from operating activities:
Net income	$ 299,810	$ 354,153	569,664	620,070
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation			93,640	87,123
Amortization of deferred loan origination costs			47,524	45,713
Amortization Of Financing Origination Fees			4,820	4,284
Pension and Other Postretirement Benefit Expense			24,635	16,854
Contributions to pension and postretirement plans			(12,725)	(14,035)
Stock compensation expense			16,734	20,768
Net change in wholesale finance receivables related to sales			(418,969)	(510,200)
Provision for credit losses	15,175	15,961	41,422	36,292
Foreign currency adjustments			11,041	(5,084)
Other, net			(1,964)	9,332
Changes in current assets and liabilities:
Accounts receivable			(43,309)	(25,643)
Finance receivables-accrued interest and other			(270)	(993)
Inventories			38,012	58,741
Accounts payable and accrued liabilities			232,357	226,233
Derivative instruments			1,185	968
Increase (Decrease) in Prepaid Expenses, Other			(11,342)	(2,918)
Total adjustments			44,280	(49,478)
Net cash provided by operating activities			613,944	570,592
Cash flows from investing activities:
Capital expenditures			(85,180)	(74,523)
Origination of finance receivables			(1,976,563)	(1,904,577)
Collections of finance receivables			1,570,431	1,518,186
Sales and redemptions of marketable securities			4,500	41,010
Other			5,111	145
Net cash (used by) provided by investing activities			(481,701)	(419,759)
Repayments of Unsecured Debt			0	(303,000)
Proceeds from Issuance of Medium-term Notes			595,386	0
Cash flows from financing activities:
Intercompany Borrowing Activity			0	0
Proceeds from Securitization Debt			1,195,668	847,126
Proceeds from Other Debt				847,126
Repayments of Securitization Debt			(454,332)	(393,655)
borrowings of asset backed commercial paper			40,209	36,800
Proceeds from (Repayments of) Credit Facility and Other Unsecured Debt			(616,586)	(48,134)
Net repayments of asset-backed commercial paper			35,730
Repayments of asset-backed commercial paper			(35,730)	(37,317)
Net change in restricted cash			(40,159)	(9,874)
Dividends paid			(129,745)	(120,631)
Purchase of common stock for treasury			(358,425)	(223,736)
Excess tax benefits from share based payments			2,401	8,652
Issuance of common stock under employee stock option plans			15,664	27,907
Borrowings of asset-backed commercial paper			40,209	36,800
Net cash provided by (used by) financing activities			214,351	(223,082)
Effect of exchange rate changes on cash and cash equivalents			(5,695)	4,983
Net increase (decrease) in cash and cash equivalents			340,899	(67,266)
Cash and cash equivalents:
Cash and cash equivalents—beginning of period			906,680	1,066,612
Net increase (decrease) in cash and cash equivalents			340,899	(67,266)
Cash and cash equivalents—end of period	1,247,579	999,346	1,247,579	999,346
Gains (Losses) on Extinguishment of Debt			0	1,145
Motorcycles And Related Products Operations [Member]
Segment Reporting Information [Line Items]
Repayments of Medium-term Notes				0
Deferred Income Taxes and Tax Credits			5,832	(3,894)
Cash flows from operating activities:
Net income	249,849	308,472	577,098	655,526
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation			88,996	83,348
Amortization of deferred loan origination costs			0	0
Amortization Of Financing Origination Fees			0	59
Pension and Other Postretirement Benefit Expense			24,635	16,854
Contributions to pension and postretirement plans			(12,725)	(14,035)
Stock compensation expense			15,415	19,393
Net change in wholesale finance receivables related to sales			0	0
Provision for credit losses	0	0	0	0
Foreign currency adjustments			11,041	939
Other, net			(2,671)	4,712
Changes in current assets and liabilities:
Accounts receivable			(347,967)	(363,817)
Finance receivables-accrued interest and other			0	0
Inventories			38,012	58,741
Accounts payable and accrued liabilities			144,784	189,117
Derivative instruments			1,185	968
Increase (Decrease) in Prepaid Expenses, Other			(9,625)	(4,962)
Total adjustments			(23,838)	(2,653)
Net cash provided by operating activities			553,260	652,873
Cash flows from investing activities:
Capital expenditures			(83,282)	(71,395)
Origination of finance receivables			0	0
Collections of finance receivables			0	0
Sales and redemptions of marketable securities			4,500	41,010
Other			5,111	145
Net cash (used by) provided by investing activities			(73,671)	(30,240)
Repayments of Unsecured Debt				(303,000)
Proceeds from Issuance of Medium-term Notes			0
Cash flows from financing activities:
Intercompany Borrowing Activity			250,000	(100,000)
Proceeds from Securitization Debt			0
Proceeds from Other Debt				0
Repayments of Securitization Debt			0	0
borrowings of asset backed commercial paper			0	0
Proceeds from (Repayments of) Credit Facility and Other Unsecured Debt			0	0
Net repayments of asset-backed commercial paper			0
Repayments of asset-backed commercial paper				0
Net change in restricted cash			0	0
Dividends paid			(129,745)	(120,631)
Purchase of common stock for treasury			(358,425)	(223,736)
Excess tax benefits from share based payments			2,401	8,652
Issuance of common stock under employee stock option plans			15,664	27,907
Net cash provided by (used by) financing activities			(220,105)	(710,808)
Effect of exchange rate changes on cash and cash equivalents			(5,090)	4,968
Net increase (decrease) in cash and cash equivalents			254,394	(83,207)
Cash and cash equivalents:
Cash and cash equivalents—beginning of period			573,895	718,912
Net increase (decrease) in cash and cash equivalents			254,394	(83,207)
Cash and cash equivalents—end of period	828,289	635,705	828,289	635,705
Gains (Losses) on Extinguishment of Debt				0
Financial Services Operations [Member]
Segment Reporting Information [Line Items]
Repayments of Medium-term Notes				(7,220)
Deferred Income Taxes and Tax Credits			(7,027)	0
Cash flows from operating activities:
Net income	49,961	45,681	92,566	84,544
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation			4,644	3,775
Amortization of deferred loan origination costs			47,524	45,713
Amortization Of Financing Origination Fees			4,820	4,225
Pension and Other Postretirement Benefit Expense			0	0
Contributions to pension and postretirement plans			0	0
Stock compensation expense			1,319	1,375
Net change in wholesale finance receivables related to sales			0	0
Provision for credit losses	15,175	15,961	41,422	36,292
Foreign currency adjustments			0	(6,023)
Other, net			707	4,620
Changes in current assets and liabilities:
Accounts receivable			0	0
Finance receivables-accrued interest and other			(270)	(993)
Inventories			0	0
Accounts payable and accrued liabilities			385,999	375,290
Derivative instruments			0	0
Increase (Decrease) in Prepaid Expenses, Other			(1,717)	2,044
Total adjustments			480,855	463,375
Net cash provided by operating activities			573,421	547,919
Cash flows from investing activities:
Capital expenditures			(1,898)	(3,128)
Origination of finance receivables			(4,526,313)	(4,580,910)
Collections of finance receivables			3,707,444	3,684,319
Sales and redemptions of marketable securities			0	0
Other			0	0
Net cash (used by) provided by investing activities			(820,767)	(899,719)
Repayments of Unsecured Debt				0
Proceeds from Issuance of Medium-term Notes			595,386
Cash flows from financing activities:
Intercompany Borrowing Activity			(250,000)	100,000
Proceeds from Securitization Debt			1,195,668
Proceeds from Other Debt				847,126
Repayments of Securitization Debt			(454,332)	(393,655)
borrowings of asset backed commercial paper			40,209	36,800
Proceeds from (Repayments of) Credit Facility and Other Unsecured Debt			(616,586)	(48,134)
Net repayments of asset-backed commercial paper			35,730
Repayments of asset-backed commercial paper				(37,317)
Net change in restricted cash			(40,159)	(9,874)
Dividends paid			(100,000)	(120,000)
Purchase of common stock for treasury			0	0
Excess tax benefits from share based payments			0	0
Issuance of common stock under employee stock option plans			0	0
Net cash provided by (used by) financing activities			334,456	367,726
Effect of exchange rate changes on cash and cash equivalents			(605)	15
Net increase (decrease) in cash and cash equivalents			86,505	15,941
Cash and cash equivalents:
Cash and cash equivalents—beginning of period			332,785	347,700
Net increase (decrease) in cash and cash equivalents			86,505	15,941
Cash and cash equivalents—end of period	419,290	363,641	419,290	363,641
Gains (Losses) on Extinguishment of Debt				1,145
Consolidation, Eliminations [Member]
Segment Reporting Information [Line Items]
Repayments of Medium-term Notes				0
Deferred Income Taxes and Tax Credits			0	0
Cash flows from operating activities:
Net income	0	0	(100,000)	(120,000)
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation			0	$ 0
Amortization of deferred loan origination costs			0
Amortization Of Financing Origination Fees			0	$ 0
Pension and Other Postretirement Benefit Expense			0	0
Contributions to pension and postretirement plans			0	0
Stock compensation expense			0	0
Net change in wholesale finance receivables related to sales			(418,969)	(510,200)
Provision for credit losses	0	0	0	0
Foreign currency adjustments			0	0
Other, net			0	0
Changes in current assets and liabilities:
Accounts receivable			304,658	338,174
Finance receivables-accrued interest and other			0	0
Inventories			0	0
Accounts payable and accrued liabilities			(298,426)	(338,174)
Derivative instruments			0	0
Increase (Decrease) in Prepaid Expenses, Other			0	0
Total adjustments			(412,737)	(510,200)
Net cash provided by operating activities			(512,737)	(630,200)
Cash flows from investing activities:
Capital expenditures			0	0
Origination of finance receivables			2,549,750	2,676,333
Collections of finance receivables			(2,137,013)	(2,166,133)
Sales and redemptions of marketable securities			0	0
Other			0	0
Net cash (used by) provided by investing activities			412,737	510,200
Repayments of Unsecured Debt				0
Proceeds from Issuance of Medium-term Notes			0
Cash flows from financing activities:
Intercompany Borrowing Activity			0	0
Proceeds from Securitization Debt			0
Proceeds from Other Debt				0
Repayments of Securitization Debt			0	0
borrowings of asset backed commercial paper			0	0
Proceeds from (Repayments of) Credit Facility and Other Unsecured Debt			0	0
Net repayments of asset-backed commercial paper			0
Repayments of asset-backed commercial paper				0
Net change in restricted cash			0	0
Dividends paid			100,000	120,000
Purchase of common stock for treasury			0	0
Excess tax benefits from share based payments			0	0
Issuance of common stock under employee stock option plans			0	0
Net cash provided by (used by) financing activities			100,000	120,000
Effect of exchange rate changes on cash and cash equivalents			0	0
Net increase (decrease) in cash and cash equivalents			0	0
Cash and cash equivalents:
Cash and cash equivalents—beginning of period			0	0
Net increase (decrease) in cash and cash equivalents			0	0
Cash and cash equivalents—end of period	$ 0	$ 0	$ 0	0
Gains (Losses) on Extinguishment of Debt				$ 0

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CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 28, 2015	Jun. 29, 2014	Jun. 28, 2015	Jun. 29, 2014
Revenue:
Motorcycles and Related Products	$ 1,650,783	$ 1,834,285	$ 3,161,353	$ 3,405,973
Financial Services	173,609	166,414	335,984	320,774
Total revenue	1,824,392	2,000,699	3,497,337	3,726,747
Costs and expenses:
Motorcycles and Related Products cost of goods sold	1,003,569	1,110,146	1,923,864	2,089,703
Financial Services interest expense	41,188	40,741	79,724	79,598
Financial Services provision for credit losses	15,175	15,961	41,422	36,292
Selling, administrative and engineering expense	301,944	286,156	579,693	562,577
Total costs and expenses	1,361,876	1,453,004	2,624,703	2,768,170
Operating income	462,516	547,695	872,634	958,577
Investment income	1,450	1,772	2,772	3,431
Interest expense	9	393	18	4,070
Income before provision for income taxes	463,957	549,074	875,388	957,938
Provision for income taxes	164,147	194,921	305,724	337,868
Net income	$ 299,810	$ 354,153	$ 569,664	$ 620,070
Earnings per common share:
Basic (in dollars per share)	$ 1.44	$ 1.63	$ 2.72	$ 2.84
Diluted (in dollars per share)	1.44	1.62	2.71	2.82
Cash dividends per common share (in dollars per share)	$ 0.310	$ 0.275	$ 0.620	$ 0.550

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Finance Receivables (Narrative) (Detail) - USD ($)	Jun. 28, 2015	Dec. 31, 2014	Jun. 29, 2014
Accounts, Notes, Loans and Financing Receivable [Line Items]
Individually evaluated for impairment	$ 0	$ 0	$ 0
Greater than 90 Days Past Due	18,447,000	28,918,000	14,720,000
Retail [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Individually evaluated for impairment	0	0	0
Wholesale finance receivables, gross	18,300,000	28,700,000	14,700,000
Greater than 90 Days Past Due	18,274,000	28,712,000	14,686,000
Wholesale [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Individually evaluated for impairment	0	0	0
Greater than 90 Days Past Due	173,000	206,000	34,000
Financing Receivable, Recorded Investment, Nonaccrual Status	0	0	0
Nonperforming Financing Receivable [Member] | Wholesale [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Individually evaluated for impairment	$ 0	$ 0	$ 0

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Basis Of Presentation And Use Of Estimates

6 Months Ended

Jun. 28, 2015

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Basis of Presentation and Use of Estimates

Basis of Presentation and Use of Estimates

The condensed consolidated financial statements include the accounts of Harley-Davidson, Inc. and its wholly-owned subsidiaries (the Company), including the accounts of the groups of companies doing business as Harley-Davidson Motor Company (HDMC) and Harley-Davidson Financial Services (HDFS). In addition, certain variable interest entities (VIEs) related to secured financing are consolidated as the Company is the primary beneficiary. All intercompany accounts and material intercompany transactions are eliminated.

In the opinion of management, the accompanying unaudited condensed consolidated financial statements contain all adjustments (consisting only of normal recurring adjustments) necessary to present fairly the condensed consolidated balance sheets as of June 28, 2015 and June 29, 2014, the condensed consolidated statements of income for the three and six month periods then ended, the condensed consolidated statements of comprehensive income for the three and six month periods then ended and the condensed consolidated statements of cash flows for the six month periods then ended.

Certain information and footnote disclosures normally included in complete financial statements have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission (SEC) and U.S. generally accepted accounting principles (U.S. GAAP) for interim financial reporting. These condensed consolidated financial statements should be read in conjunction with the audited financial statements and notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2014.

The Company operates in two principal reportable segments: Motorcycles & Related Products (Motorcycles) and Financial Services.

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and the accompanying notes. Actual results could differ from those estimates.

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Debt Debt (Debt With A Contractual Term Greater Than One Year) (Details) - Credit Facility [Domain] - Line of Credit Facility, Lender [Domain] - USD ($)	6 Months Ended
	Jun. 28, 2015	Jun. 29, 2014	Mar. 29, 2015	Dec. 31, 2014
Debt Instrument [Line Items]
Short-term debt	$ 114,983,000	$ 619,622,000		$ 731,786,000
Long-term Debt, Current Maturities	(1,551,368,000)	(944,915,000)		(1,011,315,000)
Long-term debt	4,560,349,000	3,794,396,000		3,761,528,000
Gross Long-term Debt	6,111,717,000	4,739,311,000		4,772,843,000
Gains (Losses) on Extinguishment of Debt	0	(1,145,000)
Medium-Term Notes Due 2014 [Member]
Debt Instrument [Line Items]
Company issued secured notes	$ 500,000,000
Debt Instrument, Interest Rate, Stated Percentage	5.75%
Medium-Term Notes Due 2015 [Member]
Debt Instrument [Line Items]
Company issued secured notes	$ 600,000,000
Debt Instrument, Interest Rate, Stated Percentage	1.15%
Medium-Term Notes Due 2016 [Member]
Debt Instrument [Line Items]
Company issued secured notes	$ 450,000,000
Debt Instrument, Interest Rate, Stated Percentage	3.88%
Medium-Term Notes Due 2017 [Member]
Debt Instrument [Line Items]
Company issued secured notes	$ 400,000,000
Debt Instrument, Interest Rate, Stated Percentage	2.70%
Medium-Term Notes Due 2017 1.55 rate [Member]
Debt Instrument [Line Items]
Company issued secured notes	$ 400,000,000
Debt Instrument, Interest Rate, Stated Percentage	1.55%
Medium-Term Notes Due 2018 [Member]
Debt Instrument [Line Items]
Company issued secured notes	$ 888,000,000
Debt Instrument, Interest Rate, Stated Percentage	6.80%
Medium-Term Notes Due 2019 [Member]
Debt Instrument [Line Items]
Company issued secured notes	$ 600,000,000
Debt Instrument, Interest Rate, Stated Percentage	2.40%
Medium-Term Notes Due 2020 [Member]
Debt Instrument [Line Items]
Company issued secured notes	$ 600,000,000
Debt Instrument, Interest Rate, Stated Percentage	2.15%
Secured Debt [Member] | Asset-Backed Canadian Commercial Paper Conduit Facility [Member]
Debt Instrument [Line Items]
Gross Long-term Debt	$ 160,940,000	173,224,000		166,912,000
Secured Debt [Member] | Term Asset-Backed Securitization VIEs [Member]
Debt Instrument [Line Items]
Gross Long-term Debt	2,017,079,000	1,712,855,000		1,271,533,000
Secured Debt [Member] | Secured Notes Through One Term Asset-backed Securitization Transaction [Member]
Debt Instrument [Line Items]
Company issued secured notes	500,000,000	850,000,000.0	$ 700,000,000
Unsecured Debt [Member] | Medium-Term Notes Due 2014 [Member]
Debt Instrument [Line Items]
Gross Long-term Debt	0	499,946,000		0
Unsecured Debt [Member] | Medium-Term Notes Due 2015 [Member]
Debt Instrument [Line Items]
Gross Long-term Debt	599,954,000	599,680,000		599,817,000
Unsecured Debt [Member] | Medium-Term Notes Due 2016 [Member]
Debt Instrument [Line Items]
Gross Long-term Debt	449,964,000	449,910,000		449,937,000
Unsecured Debt [Member] | Medium-Term Notes Due 2017 [Member]
Debt Instrument [Line Items]
Gross Long-term Debt	399,972,000	399,955,000		399,963,000
Unsecured Debt [Member] | Medium-Term Notes Due 2017 1.55 rate [Member]
Debt Instrument [Line Items]
Gross Long-term Debt	399,557,000	0		399,464,000
Unsecured Debt [Member] | Medium-Term Notes Due 2018 [Member]
Debt Instrument [Line Items]
Gross Long-term Debt	887,467,000	903,741,000		887,381,000
Unsecured Debt [Member] | Medium-Term Notes Due 2019 [Member]
Debt Instrument [Line Items]
Gross Long-term Debt	598,066,000	0		597,836,000
Unsecured Debt [Member] | Medium-Term Notes Due 2020 [Member]
Debt Instrument [Line Items]
Gross Long-term Debt	$ 598,718,000	0		$ 0
Financial Services Segment [Member] | Medium-term Notes [Member] | Medium-Term Notes Due 2018 [Member]
Debt Instrument [Line Items]
Debt Instrument, Interest Rate, Stated Percentage	6.80%
Debt Instrument, Repurchase Amount		6,100,000
Gains (Losses) on Extinguishment of Debt		$ (1,100,000)
Financial Services Segment [Member] | Medium-term Notes [Member] | Medium-Term Notes Due 2020 [Member]
Debt Instrument [Line Items]
Company issued secured notes	$ 600,000,000
Debt Instrument, Interest Rate, Stated Percentage	2.15%

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Employee Benefit Plans (Tables)

6 Months Ended

Jun. 28, 2015

Compensation and Retirement Disclosure [Abstract]

Components Of Net Periodic Benefit Costs

Components of net periodic benefit costs were as follows (in thousands):

	Three months ended						Six months ended
	June 28, 2015			June 29, 2014			June 28, 2015			June 29, 2014
Pension and SERPA Benefits
Service cost	$	10,010		$	7,874		$	20,020		$	15,748
Interest cost	21,836			21,731			43,672			43,462
Expected return on plan assets	(36,232		)	(34,184		)	(72,465		)	(68,368		)
Amortization of unrecognized:
Prior service cost	109			279			218			558
Net loss	13,677			9,141			27,354			18,281
Net periodic benefit cost	$	9,400		$	4,841		$	18,799		$	9,681
Postretirement Healthcare Benefits
Service cost	$	2,065		$	1,754		$	4,130		$	3,508
Interest cost	3,541			4,220			7,082			8,439
Expected return on plan assets	(2,877		)	(2,607		)	(5,754		)	(5,215		)
Amortization of unrecognized:
Prior service credit	(804		)	(963		)	(1,608		)	(1,927		)
Net loss	993			1,182			1,986			2,364
Net periodic benefit cost	$	2,918		$	3,586		$	5,836		$	7,169

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Employee Benefit Plans (Components Of Net Periodic Benefit Costs) (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 28, 2015	Jun. 29, 2014	Jun. 28, 2015	Jun. 29, 2014
Pension Plans and Supplemental Employee Retirement Plan, Defined Benefit [Member]
Defined Benefit Plan Disclosure [Line Items]
Service cost	$ 10,010	$ 7,874	$ 20,020	$ 15,748
Interest cost	21,836	21,731	43,672	43,462
Expected return on plan assets	(36,232)	(34,184)	(72,465)	(68,368)
Prior service cost	109	279	218	558
Net loss	13,677	9,141	27,354	18,281
Net periodic benefit cost	9,400	4,841	18,799	9,681
Postretirement Healthcare Benefits [Member]
Defined Benefit Plan Disclosure [Line Items]
Service cost	2,065	1,754	4,130	3,508
Interest cost	3,541	4,220	7,082	8,439
Expected return on plan assets	(2,877)	(2,607)	(5,754)	(5,215)
Prior service cost	(804)	(963)	(1,608)	(1,927)
Net loss	993	1,182	1,986	2,364
Net periodic benefit cost	$ 2,918	$ 3,586	$ 5,836	$ 7,169

XML

Supplemental Consolidating Data

6 Months Ended

Jun. 28, 2015

Condensed Financial Information of Parent Company Only Disclosure [Abstract]

Supplemental Consolidating Data

Supplemental Consolidating Data

The supplemental consolidating data for the periods noted is presented for informational purposes. The supplemental consolidating data may be different than segment information presented elsewhere due to the allocation of intercompany eliminations to reporting segments. All supplemental data is presented in thousands.

	Three months ended June 28, 2015
	Motorcycles & Related Products Operations		Financial Services Operations		Eliminations			Consolidated
Revenue:
Motorcycles and Related Products	$	1,653,759	$	—	$	(2,976	)	$	1,650,783
Financial Services	—		174,147		(538		)	173,609
Total revenue	1,653,759		174,147		(3,514		)	1,824,392
Costs and expenses:
Motorcycles and Related Products cost of goods sold	1,003,569		—		—			1,003,569
Financial Services interest expense	—		41,188		—			41,188
Financial Services provision for credit losses	—		15,175		—			15,175
Selling, administrative and engineering expense	267,149		38,309		(3,514		)	301,944
Total costs and expenses	1,270,718		94,672		(3,514		)	1,361,876
Operating income	383,041		79,475		—			462,516
Investment income	1,450		—		—			1,450
Interest expense	9		—		—			9
Income before provision for income taxes	384,482		79,475		—			463,957
Provision for income taxes	134,633		29,514		—			164,147
Net income	$	249,849	$	49,961	$	—		$	299,810
	Six months ended June 28, 2015
	Motorcycles & Related Products Operations		Financial Services Operations		Eliminations			Consolidated
Revenue:
Motorcycles and Related Products	$	3,166,641	$	—	$	(5,288	)	$	3,161,353
Financial Services	—		336,837		(853		)	335,984
Total revenue	3,166,641		336,837		(6,141		)	3,497,337
Costs and expenses:
Motorcycles and Related Products cost of goods sold	1,923,864		—		—			1,923,864
Financial Services interest expense	—		79,724		—			79,724
Financial Services provision for credit losses	—		41,422		—			41,422
Selling, administrative and engineering expense	512,284		73,550		(6,141		)	579,693
Total costs and expenses	2,436,148		194,696		(6,141		)	2,624,703
Operating income	730,493		142,141		—			872,634
Investment income	102,772		—		(100,000		)	2,772
Interest expense	18		—		—			18
Income before provision for income taxes	833,247		142,141		(100,000		)	875,388
Provision for income taxes	256,149		49,575		—			305,724
Net income	$	577,098	$	92,566	$	(100,000	)	$	569,664

	Three months ended June 29, 2014
	Motorcycles & Related Products Operations		Financial Services Operations		Eliminations			Consolidated
Revenue:
Motorcycles and Related Products	$	1,836,974	$	—	$	(2,689	)	$	1,834,285
Financial Services	—		166,963		(549		)	166,414
Total revenue	1,836,974		166,963		(3,238		)	2,000,699
Costs and expenses:
Motorcycles and Related Products cost of goods sold	1,110,146		—		—			1,110,146
Financial Services interest expense	—		40,741		—			40,741
Financial Services provision for credit losses	—		15,961		—			15,961
Selling, administrative and engineering expense	251,432		37,962		(3,238		)	286,156
Total costs and expenses	1,361,578		94,664		(3,238		)	1,453,004
Operating income	475,396		72,299		—			547,695
Investment income	1,772		—		—			1,772
Interest expense	393		—		—			393
Income before provision for income taxes	476,775		72,299		—			549,074
Provision for income taxes	168,303		26,618		—			194,921
Net income	$	308,472	$	45,681	$	—		$	354,153
	Six months ended June 29, 2014
	Motorcycles & Related Products Operations		Financial Services Operations		Eliminations			Consolidated
Revenue:
Motorcycles and Related Products	$	3,410,941	$	—	$	(4,968	)	$	3,405,973
Financial Services	—		321,649		(875		)	320,774
Total revenue	3,410,941		321,649		(5,843		)	3,726,747
Costs and expenses:
Motorcycles and Related Products cost of goods sold	2,089,703		—		—			2,089,703
Financial Services interest expense	—		79,598		—			79,598
Financial Services provision for credit losses	—		36,292		—			36,292
Selling, administrative and engineering expense	496,197		72,223		(5,843		)	562,577
Total costs and expenses	2,585,900		188,113		(5,843		)	2,768,170
Operating income	825,041		133,536		—			958,577
Investment income	123,431		—		(120,000		)	3,431
Interest expense	4,070		—		—			4,070
Income before provision for income taxes	944,402		133,536		(120,000		)	957,938
Provision for income taxes	288,876		48,992		—			337,868
Net income	$	655,526	$	84,544	$	(120,000	)	$	620,070

	June 28, 2015
	Motorcycles & Related Products Operations		Financial Services Operations		Eliminations			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	828,289	$	419,290	$	—		$	1,247,579
Marketable securities	52,516		—		—			52,516
Accounts receivable, net	743,341		—		(465,772		)	277,569
Finance receivables, net	—		2,331,723		—			2,331,723
Inventories	395,044		—		—			395,044
Restricted cash	—		136,760		—			136,760
Deferred income taxes	51,667		43,111		—			94,778
Other current assets	126,856		40,441		(6,876		)	160,421
Total current assets	2,197,713		2,971,325		(472,648		)	4,696,390
Finance receivables, net	—		4,816,772		—			4,816,772
Property, plant and equipment, net	841,361		31,646		—			873,007
Goodwill	26,105		—		—			26,105
Deferred income taxes	57,587		10,861		(1,693		)	66,755
Other long-term assets	121,264		43,842		(79,263		)	85,843
	$	3,244,030	$	7,874,446	$	(553,604	)	$	10,564,872
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	306,335	$	567,073	$	(465,772	)	$	407,636
Accrued liabilities	369,467		87,839		(8,569		)	448,737
Short-term debt	—		114,983		—			114,983
Current portion of long-term debt	—		1,551,368		—			1,551,368
Total current liabilities	675,802		2,321,263		(474,341		)	2,522,724
Long-term debt	—		4,560,349		—			4,560,349
Pension liability	66,786		—		—			66,786
Postretirement healthcare benefits	196,369		—		—			196,369
Other long-term liabilities	168,043		26,974		—			195,017
Shareholders’ equity	2,137,030		965,860		(79,263		)	3,023,627
	$	3,244,030	$	7,874,446	$	(553,604	)	$	10,564,872

	December 31, 2014
	Motorcycles & Related Products Operations		Financial Services Operations		Eliminations			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	573,895	$	332,785	$	—		$	906,680
Marketable securities	57,325		—		—			57,325
Accounts receivable, net	658,735		—		(411,114		)	247,621
Finance receivables, net	—		1,916,635		—			1,916,635
Inventories	448,871		—		—			448,871
Restricted cash	—		98,627		—			98,627
Deferred income taxes	50,015		39,901		—			89,916
Other current assets	142,278		43,125		(2,983		)	182,420
Total current assets	1,931,119		2,431,073		(414,097		)	3,948,095
Finance receivables, net	—		4,516,246		—			4,516,246
Property, plant and equipment, net	848,661		34,416		—			883,077
Goodwill	27,752		—		—			27,752
Deferred income taxes	75,121		4,863		(2,149		)	77,835
Other long-term assets	113,727		39,309		(77,944		)	75,092
	$	2,996,380	$	7,025,907	$	(494,190	)	$	9,528,097
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	171,098	$	436,884	$	(411,114	)	$	196,868
Accrued liabilities	370,652		83,797		(5,132		)	449,317
Short-term debt	—		731,786		—			731,786
Current portion of long-term debt	—		1,011,315		—			1,011,315
Total current liabilities	541,750		2,263,782		(416,246		)	2,389,286
Long-term debt	—		3,761,528		—			3,761,528
Pension liability	76,186		—		—			76,186
Postretirement healthcare benefits	203,006		—		—			203,006
Other long-term liabilities	164,060		24,745		—			188,805
Shareholders’ equity	2,011,378		975,852		(77,944		)	2,909,286
	$	2,996,380	$	7,025,907	$	(494,190	)	$	9,528,097

	June 29, 2014
	Motorcycles & Related Products Operations		Financial Services Operations		Eliminations			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	635,705	$	363,641	$	—		$	999,346
Marketable securities	57,814		—		—			57,814
Accounts receivable, net	1,317,297		—		(1,027,357		)	289,940
Finance receivables, net	—		2,281,512		—			2,281,512
Inventories	371,597		—		—			371,597
Restricted cash	—		154,681		—			154,681
Deferred income taxes	52,348		38,000		—			90,348
Other current assets	95,429		33,031		—			128,460
Total current assets	2,530,190		2,870,865		(1,027,357		)	4,373,698
Finance receivables, net	—		4,537,405		—			4,537,405
Property, plant and equipment, net	792,642		33,825		—			826,467
Prepaid pension costs	256,279		—		—			256,279
Goodwill	30,252		—		—			30,252
Deferred income taxes	2,915		—		—			2,915
Other long-term assets	111,229		14,506		(76,455		)	49,280
	$	3,723,507	$	7,456,601	$	(1,103,812	)	$	10,076,296
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	316,707	$	1,098,992	$	(1,027,357	)	$	388,342
Accrued liabilities	423,312		79,205		(1,748		)	500,769
Short-term debt	—		619,622		—			619,622
Current portion of long-term debt	—		944,915		—			944,915
Total current liabilities	740,019		2,742,734		(1,029,105		)	2,453,648
Long-term debt	—		3,794,396		—			3,794,396
Pension liability	38,174		—		—			38,174
Postretirement healthcare liability	209,312		—		—			209,312
Deferred income taxes	35,597		1,574		1,748			38,919
Other long-term liabilities	152,862		22,725		—			175,587
Shareholders’ equity	2,547,543		895,172		(76,455		)	3,366,260
	$	3,723,507	$	7,456,601	$	(1,103,812	)	$	10,076,296

	Six months ended June 28, 2015
	Motorcycles & Related Products Operations			Financial Services Operations			Eliminations & Adjustments			Consolidated
Cash flows from operating activities:
Net income	$	577,098		$	92,566		$	(100,000	)	$	569,664
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation	88,996			4,644			—			93,640
Amortization of deferred loan origination costs	—			47,524			—			47,524
Amortization of financing origination fees	—			4,820			—			4,820
Provision for employee long-term benefits	24,635			—			—			24,635
Contributions to pension and postretirement plans	(12,725		)	—			—			(12,725		)
Stock compensation expense	15,415			1,319			—			16,734
Net change in wholesale finance receivables related to sales	—			—			(418,969		)	(418,969		)
Provision for credit losses	—			41,422			—			41,422
Deferred income taxes	5,832			(7,027		)	—			(1,195		)
Foreign currency adjustments	11,041			—			—			11,041
Other, net	(2,671		)	707			—			(1,964		)
Change in current assets and current liabilities:
Accounts receivable	(347,967		)	—			304,658			(43,309		)
Finance receivables—accrued interest and other	—			(270		)	—			(270		)
Inventories	38,012			—			—			38,012
Accounts payable and accrued liabilities	144,784			385,999			(298,426		)	232,357
Derivative instruments	1,185			—			—			1,185
Other	9,625			1,717			—			11,342
Total adjustments	(23,838		)	480,855			(412,737		)	44,280
Net cash provided by operating activities	553,260			573,421			(512,737		)	613,944

	Six months ended June 28, 2015
	Motorcycles & Related Products Operations			Financial Services Operations			Eliminations & Adjustments			Consolidated
Cash flows from investing activities:
Capital expenditures	(83,282		)	(1,898		)	—			(85,180		)
Origination of finance receivables	—			(4,526,313		)	2,549,750			(1,976,563		)
Collections of finance receivables	—			3,707,444			(2,137,013		)	1,570,431
Sales and redemptions of marketable securities	4,500			—			—			4,500
Other	5,111			—			—			5,111
Net cash used by investing activities	(73,671		)	(820,767		)	412,737			(481,701		)
Cash flows from financing activities:
Proceeds from issuance of medium-term notes	—			595,386			—			595,386
Intercompany borrowing activity	250,000			(250,000		)	—			—
Proceeds from securitization debt	—			1,195,668			—			1,195,668
Repayments of securitization debt	—			(454,332		)	—			(454,332		)
Net decrease in credit facilities and unsecured commercial paper	—			(616,586		)	—			(616,586		)
Borrowings of asset-backed commercial paper	—			40,209			—			40,209
Repayments of asset-backed commercial paper	—			(35,730		)	—			(35,730		)
Net change in restricted cash	—			(40,159		)	—			(40,159		)
Dividends paid	(129,745		)	(100,000		)	100,000			(129,745		)
Purchase of common stock for treasury	(358,425		)	—			—			(358,425		)
Excess tax benefits from share-based payments	2,401			—			—			2,401
Issuance of common stock under employee stock option plans	15,664			—			—			15,664
Net cash (used by) provided by financing activities	(220,105		)	334,456			100,000			214,351
Effect of exchange rate changes on cash and cash equivalents	(5,090		)	(605		)	—			(5,695		)
Net increase in cash and cash equivalents	$	254,394		$	86,505		$	—		$	340,899
Cash and cash equivalents:
Cash and cash equivalents—beginning of period	$	573,895		$	332,785		$	—		$	906,680
Net increase in cash and cash equivalents	254,394			86,505			—			340,899
Cash and cash equivalents—end of period	$	828,289		$	419,290		$	—		$	1,247,579

	Six months ended June 29, 2014
	Motorcycles & Related Products Operations			Financial Services Operations			Eliminations & Adjustments			Consolidated
Cash flows from operating activities:
Net income	$	655,526		$	84,544		$	(120,000	)	$	620,070
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation	83,348			3,775			—			87,123
Amortization of deferred loan origination costs	—			45,713						45,713
Amortization of financing origination fees	59			4,225			—			4,284
Provision for employee long-term benefits	16,854			—			—			16,854
Contributions to pension and postretirement plans	(14,035		)	—			—			(14,035		)
Stock compensation expense	19,393			1,375			—			20,768
Net change in wholesale finance receivables related to sales	—			—			(510,200		)	(510,200		)
Provision for credit losses	—			36,292			—			36,292
Loss on extinguishment of debt	—			1,145			—			1,145
Deferred income taxes	(3,894		)	—			—			(3,894		)
Foreign currency adjustments	939			(6,023		)	—			(5,084		)
Other, net	4,712			4,620			—			9,332
Change in current assets and current liabilities:
Accounts receivable	(363,817		)	—			338,174			(25,643		)
Finance receivables—accrued interest and other	—			(993		)	—			(993		)
Inventories	58,741			—			—			58,741
Accounts payable and accrued liabilities	189,117			375,290			(338,174		)	226,233
Derivative instruments	968			—			—			968
Other	4,962			(2,044		)	—			2,918
Total adjustments	(2,653		)	463,375			(510,200		)	(49,478		)
Net cash provided by operating activities	652,873			547,919			(630,200		)	570,592

	Six months ended June 29, 2014
	Motorcycles & Related Products Operations			Financial Services Operations			Eliminations & Adjustments			Consolidated
Cash flows from investing activities:
Capital expenditures	(71,395		)	(3,128		)	—			(74,523		)
Origination of finance receivables	—			(4,580,910		)	2,676,333			(1,904,577		)
Collections of finance receivables	—			3,684,319			(2,166,133		)	1,518,186
Sales and redemptions of marketable securities	41,010			—			—			41,010
Other	145			—			—			145
Net cash used by investing activities	(30,240		)	(899,719		)	510,200			(419,759		)
Cash flows from financing activities:
Repayments of senior unsecured notes	(303,000		)	—			—			(303,000		)
Repayments of medium-term notes	—			(7,220		)	—			(7,220		)
Intercompany borrowing activity	(100,000		)	100,000			—			—
Proceeds from securitization debt	—			847,126			—			847,126
Repayments of securitization debt	—			(393,655		)	—			(393,655		)
Net decrease in credit facilities and unsecured commercial paper	—			(48,134		)	—			(48,134		)
Borrowings of asset-backed commercial paper	—			36,800			—			36,800
Repayments of asset-backed commercial paper	—			(37,317		)	—			(37,317		)
Net change in restricted cash	—			(9,874		)	—			(9,874		)
Dividends paid	(120,631		)	(120,000		)	120,000			(120,631		)
Purchase of common stock for treasury	(223,736		)	—			—			(223,736		)
Excess tax benefits from share-based payments	8,652			—			—			8,652
Issuance of common stock under employee stock option plans	27,907			—			—			27,907
Net cash (used by) provided by financing activities	(710,808		)	367,726			120,000			(223,082		)
Effect of exchange rate changes on cash and cash equivalents	4,968			15			—			4,983
Net (decrease) increase in cash and cash equivalents	$	(83,207	)	$	15,941		$	—		$	(67,266	)
Cash and cash equivalents:
Cash and cash equivalents—beginning of period	$	718,912		$	347,700		$	—		$	1,066,612
Net (decrease) increase in cash and cash equivalents	(83,207		)	15,941			—			(67,266		)
Cash and cash equivalents—end of period	$	635,705		$	363,641		$	—		$	999,346

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Business Segments (Tables)

6 Months Ended

Jun. 28, 2015

Segment Reporting [Abstract]

Schedule of Segment Reporting Information, by Segment

Selected segment information is set forth below (in thousands):

	Three months ended				Six months ended
	June 28, 2015		June 29, 2014		June 28, 2015		June 29, 2014
Motorcycles net revenue	$	1,650,783	$	1,834,285	$	3,161,353	$	3,405,973
Gross profit	647,214		724,139		1,237,489		1,316,270
Selling, administrative and engineering expense	266,611		250,883		511,432		495,322
Operating income from Motorcycles	380,603		473,256		726,057		820,948
Financial Services revenue	173,609		166,414		335,984		320,774
Financial Services expense	91,696		91,975		189,407		183,145
Operating income from Financial Services	81,913		74,439		146,577		137,629
Operating income	$	462,516	$	547,695	$	872,634	$	958,577

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Additional Balance Sheet and Cash Flow Information (Tables)

6 Months Ended

Jun. 28, 2015

Supplemental Cash Flow Information [Abstract]

Marketable Securities

The Company’s marketable securities consisted of the following (in thousands):

	June 28, 2015		December 31, 2014		June 29, 2014
Available-for-sale: Corporate bonds	$	52,516	$	57,325	$	57,814
Trading securities: Mutual funds	37,698		33,815		33,567
	$	90,214	$	91,140	$	91,381

Inventories Net

Inventories consist of the following (in thousands):

	June 28, 2015			December 31, 2014			June 29, 2014
Components at the lower of FIFO cost or market
Raw materials and work in process	$	137,151		$	151,254		$	118,720
Motorcycle finished goods	186,326			230,309			179,314
Parts and accessories and general merchandise	121,469			117,210			122,289
Inventory at lower of FIFO cost or market	444,946			498,773			420,323
Excess of FIFO over LIFO cost	(49,902		)	(49,902		)	(48,726		)
	$	395,044		$	448,871		$	371,597

Reconciliation Of Net Income To Net Cash Used By Operating Activities

The reconciliation of net income to net cash provided by operating activities is as follows (in thousands):

	Six months ended
	June 28, 2015			June 29, 2014
Cash flows from operating activities:
Net income	$	569,664		$	620,070
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation	93,640			87,123
Amortization of deferred loan origination costs	47,524			45,713
Amortization of financing origination fees	4,820			4,284
Provision for employee long-term benefits	24,635			16,854
Contributions to pension and postretirement plans	(12,725		)	(14,035		)
Stock compensation expense	16,734			20,768
Net change in wholesale finance receivables related to sales	(418,969		)	(510,200		)
Provision for credit losses	41,422			36,292
Loss on debt extinguishment	—			1,145
Deferred income taxes	(1,195		)	(3,894		)
Foreign currency adjustments	11,041			(5,084		)
Other, net	(1,964		)	9,332
Changes in current assets and liabilities:
Accounts receivable, net	(43,309		)	(25,643		)
Finance receivables—accrued interest and other	(270		)	(993		)
Inventories	38,012			58,741
Accounts payable and accrued liabilities	232,357			226,233
Derivative instruments	1,185			968
Other	11,342			2,918
Total adjustments	44,280			(49,478		)
Net cash provided by operating activities	$	613,944		$	570,592

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Business Segments Narrative (Details)	6 Months Ended
	Jun. 28, 2015 segment
Segment Reporting [Abstract]
Number of businss segments	2

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New Accounting Standards

6 Months Ended

Jun. 28, 2015

Accounting Changes and Error Corrections [Abstract]

New Accounting Standards

New Accounting Standards

Accounting Standards Not Yet Adopted

In May 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2014-09 Revenue from Contracts with Customers (ASU No. 2014-09). ASU No. 2014-09 is a comprehensive new revenue recognition model that requires a company to recognize revenue to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. In July 2015, the FASB decided to defer the effective date of the new revenue recognition standard by one year to fiscal years beginning after December 15, 2017 and for interim periods therein. The Company is currently evaluating the impact of adoption.

In February 2015, the FASB issued ASU No. 2015-02 Amendments to the Consolidation Analysis (ASU 2015-02). ASU No. 2015-02 amends the guidance within Accounting Standards Codification (ASC) Topic 810, "Consolidation,” to change the analysis that a reporting entity must perform to determine whether it should consolidate certain legal entities. The Company is required to adopt ASU No, 2015-02 for fiscal years, and for interim periods within those fiscal years, beginning after December 15, 2015. The Company believes the adoption of ASU No. 2015-02 will not have an impact on its financial results and will only impact the content of the current disclosure.

In April 2015, the FASB issued ASU No. 2015-03 Simplifying the Presentation of Debt Issuance Costs (ASU 2015-03). ASU No. 2015-03 amends the guidance within ASC Topic 835, "Interest", to require that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt premiums and discounts. The Company is required to adopt ASU No, 2015-03 for fiscal years, and for interim periods within those fiscal years, beginning after December 15, 2015 on a retrospective basis. Upon adoption, the Company will reclassify its debt issuance costs from other assets to debt on the balance sheet. At June 28, 2015, the Company had $18.4 million of debt issuance costs recorded as assets on the balance sheet.

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CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 28, 2015	Jun. 29, 2014	Jun. 28, 2015	Jun. 29, 2014
Statement of Comprehensive Income [Abstract]
Net income	$ 299,810	$ 354,153	$ 569,664	$ 620,070
Other comprehensive (loss) income, net of tax
Foreign currency translation adjustments	4,251	5,733	(22,770)	8,681
Derivative financial instruments	(13,286)	3,150	(2,214)	2,923
Marketable securities	(128)	(74)	(195)	(116)
Pension and postretirement benefit plans	8,798	6,069	17,596	12,137
Total other comprehensive (loss) income, net of tax	(365)	14,878	(7,583)	23,625
Comprehensive income	$ 299,445	$ 369,031	$ 562,081	$ 643,695

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Product Warranty and Safety Recall Campaigns

6 Months Ended

Jun. 28, 2015

Product Warranties Disclosures [Abstract]

Product Warranty and Safety Recall Campaigns

Product Warranty and Recall Campaigns

The Company currently provides a standard two-year limited warranty on all new motorcycles sold worldwide, except for Japan, where the Company currently provides a standard three-year limited warranty on all new motorcycles sold. In addition, the Company provides a one-year warranty for Parts & Accessories (P&A). The warranty coverage for the retail customer generally begins when the product is sold to a retail customer. The Company maintains reserves for future warranty claims using an estimated cost, which is based primarily on historical Company claim information. Additionally, the Company has from time to time initiated voluntary recall campaigns. The Company reserves for all estimated costs associated with recalls in the period that management approves and commits to the recall.

Changes in the Company’s warranty and recall liability were as follows (in thousands):

	Three months ended						Six months ended
	June 28, 2015			June 29, 2014			June 28, 2015			June 29, 2014
Balance, beginning of period	$	71,073		$	69,336		$	69,250		$	64,120
Warranties issued during the period	21,843			19,824			36,954			37,186
Settlements made during the period	(23,554		)	(16,921		)	(37,119		)	(28,494		)
Recalls and changes to pre-existing warranty liabilities	14,054			3,798			14,331			3,225
Balance, end of period	$	83,416		$	76,037		$	83,416		$	76,037

The liability for recall campaigns was $16.6 million, $9.8 million and $6.8 million as of June 28, 2015, December 31, 2014 and June 29, 2014, respectively.

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Document and Entity Information - shares	6 Months Ended
	Jun. 28, 2015	Jul. 31, 2015
Document and Entity Information [Abstract]
Entity Registrant Name	HARLEY DAVIDSON INC
Entity Central Index Key	0000793952
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Document Type	10-Q
Document Period End Date	Jun. 28, 2015
Document Fiscal Year Focus	2015
Document Fiscal Period Focus	Q2
Amendment Flag	false
Entity Common Stock, Shares Outstanding		205,966,792

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Earnings Per Share

6 Months Ended

Jun. 28, 2015

Earnings Per Share [Abstract]

Earnings Per Share

Earnings Per Share

The following table sets forth the computation for basic and diluted earnings per share (in thousands, except per share amounts):

	Three months ended				Six months ended
	June 28, 2015		June 29, 2014		June 28, 2015		June 29, 2014
Numerator:
Net income used in computing basic and diluted earnings per share	$	299,810	$	354,153	$	569,664	$	620,070
Denominator:
Denominator for basic earnings per share - weighted-average common shares	207,650		217,762		209,115		218,367
Effect of dilutive securities - employee stock compensation plan	940		1,399		1,050		1,453
Denominator for diluted earnings per share - adjusted weighted-average shares outstanding	208,590		219,161		210,165		219,820
Earnings per common share:
Basic	$	1.44	$	1.63	$	2.72	$	2.84
Diluted	$	1.44	$	1.62	$	2.71	$	2.82

Outstanding options to purchase 1.0 million and 0.4 million shares of common stock for the three months ended June 28, 2015 and June 29, 2014, respectively and 0.8 million and 0.5 million shares of common stock for the six months ended June 28, 2015 and June 29, 2014 were not included in the Company’s computation of dilutive securities because the exercise price was greater than the market price and therefore the effect would have been anti-dilutive.

The Company has a share-based compensation plan under which employees may be granted share-based awards including shares of restricted stock and restricted stock units (RSUs). Non-forfeitable dividends are paid on unvested shares of restricted stock and non-forfeitable dividend equivalents are paid on unvested RSUs. As such, shares of restricted stock and RSUs are considered participating securities under the two-class method of calculating earnings per share as described in ASC Topic 260, “Earnings per Share.” The two-class method of calculating earnings per share did not have a material impact on the Company’s earnings per share calculation for the three and six month periods ended June 28, 2015 and June 29, 2014, respectively.

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CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Jun. 28, 2015	Dec. 31, 2014	Jun. 29, 2014
Current assets:
Cash and cash equivalents	$ 1,247,579	$ 906,680	$ 999,346
Available-for-sale Securities, Current	52,516	57,325	57,814
Accounts receivable, net	277,569	247,621	289,940
Finance receivables, net	2,331,723	1,916,635	2,281,512
Inventories	395,044	448,871	371,597
Restricted cash	136,760	98,627	154,681
Deferred Tax Assets, Net, Current	94,778	89,916	90,348
Other current assets	160,421	182,420	128,460
Total current assets	4,696,390	3,948,095	4,373,698
Finance receivables, net	4,816,772	4,516,246	4,537,405
Property, plant and equipment, net	873,007	883,077	826,467
Prepaid Pension Costs	0	0	256,279
Goodwill	26,105	27,752	30,252
Deferred Tax Assets, Net, Noncurrent	66,755	77,835	2,915
Other long-term assets	85,843	75,092	49,280
Total assets	10,564,872	9,528,097	10,076,296
Current liabilities:
Accounts payable	407,636	196,868	388,342
Accrued liabilities	448,737	449,317	500,769
Short-term debt	114,983	731,786	619,622
Current portion of long-term debt	1,551,368	1,011,315	944,915
Total current liabilities	2,522,724	2,389,286	2,453,648
Long-term debt	4,560,349	3,761,528	3,794,396
Pension liability	66,786	76,186	38,174
Postretirement healthcare liability	196,369	203,006	209,312
Deferred Tax Liabilities, Net, Noncurrent	0	0	38,919
Other long-term liabilities	$ 195,017	$ 188,805	$ 175,587
Commitments and contingencies
Shareholders’ equity:
Preferred stock, none issued	$ 0	$ 0	$ 0
Common stock	3,448	3,442	3,439
Additional paid-in-capital	1,304,855	1,265,257	1,231,913
Retained earnings	8,898,959	8,459,040	8,352,168
Accumulated other comprehensive loss	(522,526)	(514,943)	(309,051)
Treasury stock, at cost	(6,661,109)	(6,303,510)	(5,912,209)
Total shareholders' equity	3,023,627	2,909,286	3,366,260
Total liabilities and shareholders' equity	10,564,872	9,528,097	10,076,296
Variable Interest Entity, Primary Beneficiary [Member]
Current assets:
Finance receivables, net	409,198	312,645	359,085
Restricted cash	149,418	110,017	141,146
Other current assets	3,067	3,409	2,521
Finance receivables, net	1,740,420	1,113,801	1,495,171
Current liabilities:
Current portion of long-term debt	462,008	366,889	403,891
Long-term debt	1,555,071	904,644	1,308,964
Commercial Paper [Member]
Current liabilities:
Short-term debt	$ 114,983	$ 731,786	$ 619,622

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Fair Value of Financial Instruments

6 Months Ended

Jun. 28, 2015

Fair Value Disclosures [Abstract]

Fair Value of Financial Instruments

Fair Value Measurements

Certain assets and liabilities are recorded at fair value in the financial statements; some of these are measured on a recurring basis while others are measured on a non-recurring basis. Assets and liabilities measured on a recurring basis are those that are adjusted to fair value each time a financial statement is prepared. Assets and liabilities measured on a non-recurring basis are those that are adjusted to fair value when required by particular events or circumstances. In determining the fair value of assets and liabilities, the Company uses various valuation techniques. The availability of inputs observable in the market varies from instrument to instrument and depends on a variety of factors including the type of instrument, whether the instrument is actively traded, and other characteristics particular to the transaction. For many financial instruments, pricing inputs are readily observable in the market, the valuation methodology used is widely accepted by market participants, and the valuation does not require significant management discretion. For other financial instruments, pricing inputs are less observable in the market and may require management judgment.

The Company assesses the inputs used to measure fair value using a three-tier hierarchy. The hierarchy indicates the extent to which inputs used in measuring fair value are observable in the market. Level 1 inputs include quoted prices for identical instruments and are the most observable.

Level 2 inputs include quoted prices for similar assets and observable inputs such as interest rates, foreign currency exchange rates and commodity prices. The Company uses the market approach to derive the fair value for its level 2 fair value measurements. Forward contracts for foreign currency, commodities and interest rates are valued using current quoted forward rates and prices; and investments in marketable securities and cash equivalents are valued using publicly quoted prices.

Level 3 inputs are not observable in the market and include management’s judgments about the assumptions market participants would use in pricing the asset or liability. The use of observable and unobservable inputs is reflected in the hierarchy assessment disclosed in the following tables.

Recurring Fair Value Measurements

The following tables present information about the Company’s assets and liabilities measured at fair value on a recurring basis (in thousands):

	June 28, 2015
	Balance		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets:
Cash equivalents	$	1,030,928	$	558,660	$	472,268	$	—
Marketable securities	90,214		37,698		52,516		—
Derivatives	26,501		—		26,501		—
	$	1,147,643	$	596,358	$	551,285	$	—
Liabilities:
Derivatives	$	986	$	—	$	986	$	—
	December 31, 2014
	Balance		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets:
Cash equivalents	$	737,024	$	482,686	$	254,338	$	—
Marketable securities	91,140		33,815		57,325		—
Derivatives	32,244		—		32,244		—
	$	860,408	$	516,501	$	343,907	$	—
Liabilities:
Derivatives	$	2,027	$	—	$	2,027	$	—
	June 29, 2014
	Balance		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets:
Cash equivalents	$	660,520	$	482,780	$	177,740	$	—
Marketable securities	91,381		33,567		57,814		—
Derivatives	3,159		—		3,159		—
	$	755,060	$	516,347	$	238,713	$	—
Liabilities:
Derivatives	$	1,478	$	—	$	1,478	$	—

Nonrecurring Fair Value Measurements

Repossessed inventory is recorded at the lower of cost or net realizable value through a nonrecurring fair value measurement. The nonrecurring fair value measurement represents the loss recognized to adjust the related finance receivable to the fair value of the repossessed inventory. Repossessed inventory was $13.1 million, $13.4 million and $11.2 million at June 28, 2015, December 31, 2014 and June 29, 2014, for which the fair value adjustment was $1.9 million, $5.0 million and $2.4 million at June 28, 2015, December 31, 2014 and June 29, 2014, respectively. Fair value is estimated using Level 2 inputs based on the recent market values of repossessed inventory.

Fair Value of Financial Instruments

The Company’s financial instruments consist primarily of cash and cash equivalents, marketable securities, trade receivables, finance receivables, net, trade payables, debt, and foreign currency exchange and commodity contracts (derivative instruments are discussed further in Note 8).

The following table summarizes the fair value and carrying value of the Company’s financial instruments (in thousands):

	June 28, 2015				December 31, 2014				June 29, 2014
	Fair Value		Carrying Value		Fair Value		Carrying Value		Fair Value		Carrying Value
Assets:
Cash and cash equivalents	$	1,247,579	$	1,247,579	$	906,680	$	906,680	$	999,346	$	999,346
Marketable securities	$	90,214	$	90,214	$	91,140	$	91,140	$	91,381	$	91,381
Derivatives	$	26,501	$	26,501	$	32,244	$	32,244	$	3,159	$	3,159
Finance receivables, net	$	7,251,671	$	7,148,495	$	6,519,500	$	6,432,881	$	6,917,698	$	6,818,917
Restricted cash	$	162,211	$	162,211	$	122,052	$	122,052	$	154,681	$	154,681
Liabilities:
Derivatives	$	986	$	986	$	2,027	$	2,027	$	1,478	$	1,478
Unsecured commercial paper	$	114,983	$	114,983	$	731,786	$	731,786	$	619,622	$	619,622
Asset-backed Canadian commercial paper conduit facility	$	160,940	$	160,940	$	166,912	$	166,912	$	173,224	$	173,224
Medium-term notes	$	4,077,952	$	3,933,698	$	3,502,536	$	3,334,398	$	3,049,735	$	2,853,232
Term asset-backed securitization debt	$	2,016,232	$	2,017,079	$	1,270,656	$	1,271,533	$	1,717,287	$	1,712,855

Cash and Cash Equivalents and Restricted Cash – With the exception of certain cash equivalents, the carrying values of these items in the financial statements are based on historical cost. The historical cost basis for these amounts is estimated to approximate their respective fair values due to the short maturity of these instruments. Fair value is based on Level 1 or Level 2 inputs.

Marketable Securities – The carrying value of marketable securities in the financial statements is based on fair value. The fair value of marketable securities is determined primarily based on quoted prices for identical instruments or on quoted market prices of similar financial assets. Fair value is based on Level 1 or Level 2 inputs.

Finance Receivables, Net – The carrying value of retail and wholesale finance receivables in the financial statements is amortized cost less an allowance for credit losses. The fair value of retail finance receivables is generally calculated by discounting future cash flows using an estimated discount rate that reflects current credit, interest rate and prepayment risks associated with similar types of instruments. Fair value is determined based on Level 3 inputs. The amortized cost basis of wholesale finance receivables approximates fair value because they either are short-term or have interest rates that adjust with changes in market interest rates.

Derivatives – Forward contracts for foreign currency exchange, interest rates and commodities are derivative financial instruments and are carried at fair value on the balance sheet. The fair value of these contracts is determined using quoted forward rates and prices. Fair value is calculated using Level 2 inputs.

Debt – The carrying value of debt in the financial statements is generally amortized cost. The carrying value of unsecured commercial paper approximates fair value due to its short maturity. Fair value is calculated using Level 2 inputs.

The carrying value of debt provided under the Canadian Conduit approximates fair value since the interest rates charged under the facility are tied directly to market rates and fluctuate as market rates change. Fair value is calculated using Level 2 inputs.

The fair values of the medium-term notes are estimated based upon rates currently available for debt with similar terms and remaining maturities. Fair value is calculated using Level 2 inputs.

The fair value of the debt related to term asset-backed securitization transactions is estimated based on pricing currently available for transactions with similar terms and maturities. Fair value is calculated using Level 2 inputs.

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Fair Value Measurements

6 Months Ended

Jun. 28, 2015

Fair Value Disclosures [Abstract]

Fair Value Measurements

Fair Value Measurements

Certain assets and liabilities are recorded at fair value in the financial statements; some of these are measured on a recurring basis while others are measured on a non-recurring basis. Assets and liabilities measured on a recurring basis are those that are adjusted to fair value each time a financial statement is prepared. Assets and liabilities measured on a non-recurring basis are those that are adjusted to fair value when required by particular events or circumstances. In determining the fair value of assets and liabilities, the Company uses various valuation techniques. The availability of inputs observable in the market varies from instrument to instrument and depends on a variety of factors including the type of instrument, whether the instrument is actively traded, and other characteristics particular to the transaction. For many financial instruments, pricing inputs are readily observable in the market, the valuation methodology used is widely accepted by market participants, and the valuation does not require significant management discretion. For other financial instruments, pricing inputs are less observable in the market and may require management judgment.

The Company assesses the inputs used to measure fair value using a three-tier hierarchy. The hierarchy indicates the extent to which inputs used in measuring fair value are observable in the market. Level 1 inputs include quoted prices for identical instruments and are the most observable.

Level 2 inputs include quoted prices for similar assets and observable inputs such as interest rates, foreign currency exchange rates and commodity prices. The Company uses the market approach to derive the fair value for its level 2 fair value measurements. Forward contracts for foreign currency, commodities and interest rates are valued using current quoted forward rates and prices; and investments in marketable securities and cash equivalents are valued using publicly quoted prices.

Level 3 inputs are not observable in the market and include management’s judgments about the assumptions market participants would use in pricing the asset or liability. The use of observable and unobservable inputs is reflected in the hierarchy assessment disclosed in the following tables.

Recurring Fair Value Measurements

The following tables present information about the Company’s assets and liabilities measured at fair value on a recurring basis (in thousands):

	June 28, 2015
	Balance		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets:
Cash equivalents	$	1,030,928	$	558,660	$	472,268	$	—
Marketable securities	90,214		37,698		52,516		—
Derivatives	26,501		—		26,501		—
	$	1,147,643	$	596,358	$	551,285	$	—
Liabilities:
Derivatives	$	986	$	—	$	986	$	—
	December 31, 2014
	Balance		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets:
Cash equivalents	$	737,024	$	482,686	$	254,338	$	—
Marketable securities	91,140		33,815		57,325		—
Derivatives	32,244		—		32,244		—
	$	860,408	$	516,501	$	343,907	$	—
Liabilities:
Derivatives	$	2,027	$	—	$	2,027	$	—
	June 29, 2014
	Balance		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets:
Cash equivalents	$	660,520	$	482,780	$	177,740	$	—
Marketable securities	91,381		33,567		57,814		—
Derivatives	3,159		—		3,159		—
	$	755,060	$	516,347	$	238,713	$	—
Liabilities:
Derivatives	$	1,478	$	—	$	1,478	$	—

Nonrecurring Fair Value Measurements

Repossessed inventory is recorded at the lower of cost or net realizable value through a nonrecurring fair value measurement. The nonrecurring fair value measurement represents the loss recognized to adjust the related finance receivable to the fair value of the repossessed inventory. Repossessed inventory was $13.1 million, $13.4 million and $11.2 million at June 28, 2015, December 31, 2014 and June 29, 2014, for which the fair value adjustment was $1.9 million, $5.0 million and $2.4 million at June 28, 2015, December 31, 2014 and June 29, 2014, respectively. Fair value is estimated using Level 2 inputs based on the recent market values of repossessed inventory.

Fair Value of Financial Instruments

The Company’s financial instruments consist primarily of cash and cash equivalents, marketable securities, trade receivables, finance receivables, net, trade payables, debt, and foreign currency exchange and commodity contracts (derivative instruments are discussed further in Note 8).

The following table summarizes the fair value and carrying value of the Company’s financial instruments (in thousands):

	June 28, 2015				December 31, 2014				June 29, 2014
	Fair Value		Carrying Value		Fair Value		Carrying Value		Fair Value		Carrying Value
Assets:
Cash and cash equivalents	$	1,247,579	$	1,247,579	$	906,680	$	906,680	$	999,346	$	999,346
Marketable securities	$	90,214	$	90,214	$	91,140	$	91,140	$	91,381	$	91,381
Derivatives	$	26,501	$	26,501	$	32,244	$	32,244	$	3,159	$	3,159
Finance receivables, net	$	7,251,671	$	7,148,495	$	6,519,500	$	6,432,881	$	6,917,698	$	6,818,917
Restricted cash	$	162,211	$	162,211	$	122,052	$	122,052	$	154,681	$	154,681
Liabilities:
Derivatives	$	986	$	986	$	2,027	$	2,027	$	1,478	$	1,478
Unsecured commercial paper	$	114,983	$	114,983	$	731,786	$	731,786	$	619,622	$	619,622
Asset-backed Canadian commercial paper conduit facility	$	160,940	$	160,940	$	166,912	$	166,912	$	173,224	$	173,224
Medium-term notes	$	4,077,952	$	3,933,698	$	3,502,536	$	3,334,398	$	3,049,735	$	2,853,232
Term asset-backed securitization debt	$	2,016,232	$	2,017,079	$	1,270,656	$	1,271,533	$	1,717,287	$	1,712,855

Cash and Cash Equivalents and Restricted Cash – With the exception of certain cash equivalents, the carrying values of these items in the financial statements are based on historical cost. The historical cost basis for these amounts is estimated to approximate their respective fair values due to the short maturity of these instruments. Fair value is based on Level 1 or Level 2 inputs.

Marketable Securities – The carrying value of marketable securities in the financial statements is based on fair value. The fair value of marketable securities is determined primarily based on quoted prices for identical instruments or on quoted market prices of similar financial assets. Fair value is based on Level 1 or Level 2 inputs.

Finance Receivables, Net – The carrying value of retail and wholesale finance receivables in the financial statements is amortized cost less an allowance for credit losses. The fair value of retail finance receivables is generally calculated by discounting future cash flows using an estimated discount rate that reflects current credit, interest rate and prepayment risks associated with similar types of instruments. Fair value is determined based on Level 3 inputs. The amortized cost basis of wholesale finance receivables approximates fair value because they either are short-term or have interest rates that adjust with changes in market interest rates.

Derivatives – Forward contracts for foreign currency exchange, interest rates and commodities are derivative financial instruments and are carried at fair value on the balance sheet. The fair value of these contracts is determined using quoted forward rates and prices. Fair value is calculated using Level 2 inputs.

Debt – The carrying value of debt in the financial statements is generally amortized cost. The carrying value of unsecured commercial paper approximates fair value due to its short maturity. Fair value is calculated using Level 2 inputs.

The carrying value of debt provided under the Canadian Conduit approximates fair value since the interest rates charged under the facility are tied directly to market rates and fluctuate as market rates change. Fair value is calculated using Level 2 inputs.

The fair values of the medium-term notes are estimated based upon rates currently available for debt with similar terms and remaining maturities. Fair value is calculated using Level 2 inputs.

The fair value of the debt related to term asset-backed securitization transactions is estimated based on pricing currently available for transactions with similar terms and maturities. Fair value is calculated using Level 2 inputs.

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Subsequent Events (Notes)

6 Months Ended

Jun. 28, 2015

Subsequent Events [Abstract]

Subsequent Events [Text Block]

Subsequent Events

In July 2015, the Company issued $750.0 million of senior unsecured notes in an underwritten offering. The senior unsecured notes provided for semi-annual interest payments and principal due at maturity. Senior unsecured notes of $450.0 million mature in July 2025 and have an interest rate of 3.50%, and $300.0 million of the senior unsecured notes mature in July 2045 and have an interest rate of 4.625%. In June 2015, the Company announced that it would use the proceeds from the debt to repurchase shares of its common stock.

On August 4, 2015, the Company completed its previously announced purchase of certain assets from Fred Deeley Imports, Ltd. (Deeley Imports) and certain of its affiliates including, among other things, the acquisition of the exclusive right to distribute the Company's motorcycles and other products in Canada (Transaction). The Company will operate in Canada through a newly established, Company owned subsidiary (H-D Canada, L.P.) based in Concord, Ontario. H-D Canada, L.P. paid $62 million to Deeley Imports for the Canadian distribution rights, inventory and accounts receivable, net of amounts due, and other assets. H-D Canada, L.P. also indemnified Deeley Imports for certain expenses and liabilities, including employee severance costs.

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Employee Benefit Plans

6 Months Ended

Jun. 28, 2015

Compensation and Retirement Disclosure [Abstract]

Employee Benefit Plans

Employee Benefit Plans

The Company has a defined benefit pension plan and postretirement healthcare benefit plans that cover certain employees of the Motorcycles segment. The Company also has unfunded supplemental employee retirement plan agreements (SERPA) with certain employees which were instituted to replace benefits lost under the Tax Revenue Reconciliation Act of 1993. Net periodic benefit costs are allocated among selling, administrative and engineering expense, cost of goods sold and inventory. Amounts capitalized in inventory are not significant. Components of net periodic benefit costs were as follows (in thousands):

	Three months ended						Six months ended
	June 28, 2015			June 29, 2014			June 28, 2015			June 29, 2014
Pension and SERPA Benefits
Service cost	$	10,010		$	7,874		$	20,020		$	15,748
Interest cost	21,836			21,731			43,672			43,462
Expected return on plan assets	(36,232		)	(34,184		)	(72,465		)	(68,368		)
Amortization of unrecognized:
Prior service cost	109			279			218			558
Net loss	13,677			9,141			27,354			18,281
Net periodic benefit cost	$	9,400		$	4,841		$	18,799		$	9,681
Postretirement Healthcare Benefits
Service cost	$	2,065		$	1,754		$	4,130		$	3,508
Interest cost	3,541			4,220			7,082			8,439
Expected return on plan assets	(2,877		)	(2,607		)	(5,754		)	(5,215		)
Amortization of unrecognized:
Prior service credit	(804		)	(963		)	(1,608		)	(1,927		)
Net loss	993			1,182			1,986			2,364
Net periodic benefit cost	$	2,918		$	3,586		$	5,836		$	7,169

No pension contributions to qualified plans are required in 2015. The Company expects it will continue to make on-going contributions related to current benefit payments for SERPA and postretirement healthcare plans.

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Debt Debt

6 Months Ended

Jun. 28, 2015

Debt Disclosure [Abstract]

Debt Disclosure [Text Block]

Asset-Backed Financing

The Company participates in asset-backed financing through both term asset-backed securitization transactions and through asset-backed commercial paper conduit facilities. The Company treats these transactions as secured borrowings because either they are transferred to consolidated variable interest entities (VIEs) or the Company maintains effective control over the assets and does not meet the accounting sale requirements under ASC Topic 860, "Transfers and Servicing" (ASC Topic 860). In the Company's asset-backed financing programs, the Company transfers retail motorcycle finance receivables to special purpose entities (SPE), which are considered VIEs under U.S. GAAP. Each SPE then converts those assets into cash, through the issuance of debt.

The Company is required to consolidate any VIE in which it is deemed to be the primary beneficiary through having power over the significant activities of the entity and having an obligation to absorb losses or the right to receive benefits from the VIE which are potentially significant to the VIE. The Company is considered to have the power over the significant activities of its term asset-backed securitization and asset-backed U.S. commercial paper conduit facility VIEs due to its role as servicer. Servicing fees are typically not considered potentially significant variable interests in a VIE. However, the Company retains a residual interest in the VIEs in the form of a debt security, which gives the Company the right to receive benefits that could be potentially significant to the VIE. Therefore, the Company is the primary beneficiary and consolidates all of these VIEs within its consolidated financial statements.

The Company is not the primary beneficiary of the asset-backed Canadian commercial paper conduit facility VIE; therefore, the Company does not consolidate this VIE. However, the Company treats the conduit facility as a secured borrowing as it maintains effective control over the assets transferred to the VIE and therefore does not meet the requirements for sale accounting under ASC Topic 860. As such, the Company retains the transferred assets and the related debt within its Consolidated Balance Sheet.

Servicing fees paid by VIEs to the Company are eliminated in consolidation and therefore are not recorded on a consolidated basis. The Company is not required, and does not currently intend, to provide any additional financial support to its VIEs. Investors and creditors only have recourse to the assets held by the VIEs.

The following table shows the assets and liabilities related to the asset-backed financings that were included in the financial statements (in thousands):

	June 28, 2015
	Finance receivables		Allowance for credit losses			Restricted cash		Other assets		Total assets		Asset-backed debt
On-balance sheet assets and liabilities
Consolidated VIEs
Term asset-backed securitizations	$	2,199,018	$	(49,400	)	$	149,418	$	2,857	$	2,301,893	$	2,017,079
Asset-backed U.S. commercial paper conduit facility	—		—			—		210		210		—
Unconsolidated VIEs
Asset-backed Canadian commercial paper conduit facility	176,730		(2,657		)	12,793		340		187,206		160,940
Total on-balance sheet assets and liabilities	$	2,375,748	$	(52,057	)	$	162,211	$	3,407	$	2,489,309	$	2,178,019
	December 31, 2014
	Finance receivables		Allowance for credit losses			Restricted cash		Other assets		Total assets		Asset-backed debt
On-balance sheet assets and liabilities
Consolidated VIEs
Term asset-backed securitizations	$	1,458,602	$	(32,156	)	$	110,017	$	2,987	$	1,539,450	$	1,271,533
Asset-backed U.S. commercial paper conduit facility	—		—			—		422		422		—
Unconsolidated VIEs
Asset-backed Canadian commercial paper conduit facility	185,099		(2,965		)	12,035		262		194,431		166,912
Total on-balance sheet assets and liabilities	$	1,643,701	$	(35,121	)	$	122,052	$	3,671	$	1,734,303	$	1,438,445
	June 29, 2014
	Finance receivables		Allowance for credit losses			Restricted cash		Other assets		Total assets		Asset-backed debt
On-balance sheet assets and liabilities
Consolidated VIEs
Term asset-backed securitizations	$	1,893,585	$	(39,329	)	$	141,146	$	2,342	$	1,997,744	$	1,712,855
Asset-backed U.S. commercial paper conduit facility	—		—			—		179		179		—
Unconsolidated VIEs
Asset-backed Canadian commercial paper conduit facility	203,800		(3,235		)	13,535		240		214,340		173,224
Total on-balance sheet assets and liabilities	$	2,097,385	$	(42,564	)	$	154,681	$	2,761	$	2,212,263	$	1,886,079

Term Asset-Backed Securitization VIEs

The Company transfers U.S. retail motorcycle finance receivables to SPEs which in turn issue secured notes to investors, with various maturities and interest rates, secured by future collections of the purchased U.S. retail motorcycle finance receivables. Each term asset-backed securitization SPE is a separate legal entity and the U.S. retail motorcycle finance receivables included in the term asset-backed securitizations are only available for payment of the secured debt and other obligations arising from the term asset-backed securitization transaction and are not available to pay other obligations or claims of the Company’s creditors until the associated secured debt and other obligations are satisfied. Restricted cash balances held by the SPEs are used only to support the securitizations. There are no amortization schedules for the secured notes; however, the debt is reduced monthly as available collections on the related U.S. retail motorcycle finance receivables are applied to outstanding principal. The secured notes’ contractual lives have various maturities ranging from 2015 to 2022.

During the second quarter of 2015, the Company issued $500.0 million of secured notes through one term asset-backed securitization transaction. The Company also issued $700.0 million of secured notes through one term asset-backed securitization transaction during the first quarter of 2015. During the second quarter of 2014, the Company issued $850.0 million of secured notes through one term asset-backed securitization transaction. There were no other term asset-backed securitization transactions during the six months ended June 29, 2014.

Asset-Backed U.S. Commercial Paper Conduit Facility VIE

In September 2014, the Company amended and restated its facility (U.S. Conduit) with a third-party bank sponsored asset-backed commercial paper conduit, which provides for a total aggregate commitment of $600.0 million based on, among other things, the amount of eligible U.S. retail motorcycle loans held by a SPE as collateral. Under the facility, the Company may transfer U.S. retail motorcycle finance receivables to a SPE, which in turn may issue debt to third-party bank-sponsored asset-backed commercial paper conduits.

The assets of the SPE are restricted as collateral for the payment of the debt or other obligations arising in the transaction and are not available to pay other obligations or claims of the Company’s creditors. The terms for this debt provide for interest on the outstanding principal generally based on prevailing commercial paper rates plus a program fee based on outstanding principal, or LIBOR plus a specified margin to the extent the advance is not funded by a conduit lender through the issuance of commercial paper. The U.S. Conduit also provides for an unused commitment fee based on the unused portion of the total aggregate commitment of $600.0 million. There is no amortization schedule; however, the debt is reduced monthly as available collections on the related finance receivables are applied to outstanding principal. Upon expiration of the U.S. Conduit, any outstanding principal will continue to be reduced monthly through available collections. Unless earlier terminated or extended by mutual agreement of the Company and the lenders, the U.S. Conduit has an expiration date of October 30, 2015.

The SPE had no borrowings outstanding under the U.S. Conduit at June 28, 2015, December 31, 2014 or June 29, 2014; therefore, U.S. Conduit assets are restricted as collateral for the payment of fees associated with the unused portion of the total aggregate commitment.

Asset-Backed Canadian Commercial Paper Conduit Facility

In June 2014, the Company amended its facility agreement (Canadian Conduit) with a Canadian bank-sponsored asset-backed commercial paper conduit. Under the agreement, the Canadian Conduit is contractually committed, at the Company's option, to purchase eligible Canadian retail motorcycle finance receivables for proceeds up to C$200.0 million. The transferred assets are restricted as collateral for the payment of the debt. The terms for this debt provide for interest on the outstanding principal based on prevailing market interest rates plus a specified margin. The Canadian Conduit also provides for a program fee and an unused commitment fee based on the unused portion of the total aggregate commitment of C$200.0 million. There is no amortization schedule; however, the debt is reduced monthly as available collections on the related finance receivables are applied to outstanding principal. Upon expiration of the Canadian Conduit, any outstanding principal will continue to be reduced monthly through available collections. Unless earlier terminated or extended by mutual agreement of the Company and the lenders, as of June 28, 2015, the Canadian Conduit had an expiration date of June 30, 2015. The Canadian Conduit was renewed on June 30, 2015 with similar terms and a borrowing amount of up to C$240.0 million with an expiration date of June 30, 2016. The contractual maturity of the debt is approximately 5 years.

As the Company participates in and does not consolidate the Canadian bank-sponsored, multi-seller conduit VIE, the maximum exposure to loss associated with this VIE, which would only be incurred in the unlikely event that all the finance receivables and underlying collateral have no residual value, was $26.3 million at June 28, 2015. The maximum exposure is not an indication of the Company's expected loss exposure.

During the second and first quarters of 2015, the Company transferred $26.8 million and $19.2 million of Canadian retail motorcycle finance receivables to the Canadian Conduit for proceeds of $23.4 million and $16.8 million, respectively. During the second and first quarters of 2014, HDFS transferred $26.4 million and $15.7 million of Canadian retail motorcycle finance receivables to the Canadian Conduit for proceeds of $23.1 million and $13.8 million, respectively. The transferred assets are restricted as collateral for the payment of the debt.

Debt

Debt with contractual terms less than one year is generally classified as short-term debt and consisted of the following (in thousands):

	June 28, 2015		December 31, 2014		June 29, 2014
Unsecured commercial paper	$	114,983	$	731,786	$	619,622

Debt with a contractual term greater than one year is generally classified as long-term debt and consisted of the following (in thousands):

	June 28, 2015			December 31, 2014			June 29, 2014
Secured debt
Asset-backed Canadian commercial paper conduit facility	$	160,940		$	166,912		$	173,224
Term asset-backed securitization debt	2,017,079			1,271,533			1,712,855
Unsecured notes
5.75% Medium-term notes due in 2014 ($500.0 million par value)	—			—			499,946
1.15% Medium-term notes due in 2015 ($600.0 million par value)	599,954			599,817			599,680
3.88% Medium-term notes due in 2016 ($450.0 million par value)	449,964			449,937			449,910
2.70% Medium-term notes due in 2017 ($400.0 million par value)	399,972			399,963			399,955
1.55% Medium-term notes due in 2017 ($400.0 million par value)	399,557			399,464			—
6.80% Medium-term notes due in 2018 ($888.0 million par value)	887,467			887,381			903,741
2.40% Medium-term notes due in 2019 ($600.0 million par value)	598,066			597,836			—
2.15% Medium-term notes due in 2020 ($600.0 million par value)	598,718			—			—
Gross long-term debt	6,111,717			4,772,843			4,739,311
Less: current portion of long-term debt	(1,551,368		)	(1,011,315		)	(944,915		)
Long-term debt	$	4,560,349		$	3,761,528		$	3,794,396

During the first and second quarters of 2015, the Company issued $700.0 million and $500.0 million, respectively, of secured notes through term asset-backed securitization transactions. During the second quarter of 2014, the Company issued $850.0 million of secured notes through one term asset-backed securitization transaction. There were no other term asset-backed securitization transactions during the six months ended June 29, 2014. The term asset-backed securitization transactions are further discussed in Note 5.

There were no medium-term notes issued or repurchased during the second quarter of 2015. During the first quarter of 2015, the Company issued $600.0 million of medium-term notes which mature in February 2020 and have an annual interest rate of 2.15%. There were no medium-term notes issued during the six months ended June 29, 2014. During the second quarter of 2014, HDFS repurchased an aggregate of $6.1 million of its 6.80% medium-term notes which mature in June 2018. As a result, HDFS recognized in financial services interest expense $1.1 million of loss on the extinguishment of debt, which included unamortized discounts and fees.

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Income Taxes (Detail)	6 Months Ended
	Jun. 28, 2015	Jun. 29, 2014
Income Tax Disclosure [Abstract]
Income tax rate	34.90%	35.30%

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Derivative Instruments and Hedging Activities

6 Months Ended

Jun. 28, 2015

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Instruments and Hedging Activities

Derivative Instruments and Hedging Activities

The Company is exposed to certain risks such as foreign currency exchange rate risk, interest rate risk and commodity price risk. To reduce its exposure to such risks, the Company selectively uses derivative financial instruments. All derivative transactions are authorized and executed pursuant to regularly reviewed policies and procedures, which prohibit the use of financial instruments for speculative trading purposes.

All derivative instruments are recognized on the balance sheet at fair value (see Note 6). In accordance with ASC Topic 815, “Derivatives and Hedging,” the accounting for changes in the fair value of a derivative instrument depends on whether it has been designated and qualifies as part of a hedging relationship and, further, on the type of hedging relationship. Changes in the fair value of derivatives that are designated as fair value hedges, along with the gain or loss on the hedged item, are recorded in current period earnings. For derivative instruments that are designated as cash flow hedges, the effective portion of gains and losses that result from changes in the fair value of derivative instruments is initially recorded in other comprehensive income (OCI) and subsequently reclassified into earnings when the hedged item affects income. The Company assesses, both at the inception of each hedge and on an on-going basis, whether the derivatives that are used in its hedging transactions are highly effective in offsetting changes in cash flows of the hedged items. Any ineffective portion is immediately recognized in earnings. No component of a hedging derivative instrument’s gain or loss is excluded from the assessment of hedge effectiveness. Derivative instruments that do not qualify for hedge accounting are recorded at fair value, and any changes in fair value are recorded in current period earnings.

The Company sells its products internationally and in most markets those sales are made in the foreign country’s local currency. As a result, the Company’s earnings can be affected by fluctuations in the value of the U.S. dollar relative to foreign currency. The Company’s most significant foreign currency risk relates to the Euro, the Australian dollar, the Japanese yen and the Brazilian real. The Company utilizes foreign currency exchange contracts to mitigate the effects of these currencies’ fluctuations on earnings. The foreign currency exchange contracts are entered into with banks and allow the Company to exchange a specified amount of foreign currency for U.S. dollars at a future date, based on a fixed exchange rate.

The Company utilizes commodity contracts to hedge portions of the cost of certain commodities consumed in the Company’s motorcycle production and distribution operations.

The Company’s foreign currency exchange contracts and commodity contracts generally have maturities of less than one year.

During the second quarter of 2015, the Company entered into treasury rate locks to hedge the underlying U.S. treasury rate related to its anticipated issuance of senior unsecured debt during the third quarter of 2015. To the extent effective, gains and losses on the fair value of the treasury rate locks will be deferred until the forecasted debt is issued and will be amortized to earnings over the life of the debt.

The following table summarizes the fair value of the Company’s derivative financial instruments (in thousands):

	June 28, 2015						December 31, 2014						June 29, 2014
Derivatives Designated As Hedging Instruments Under ASC Topic 815	Notional Value		Asset Fair  Value(a)		Liability Fair  Value(b)		Notional Value		Asset Fair  Value(a)		Liability Fair  Value(b)		Notional Value		Asset Fair  Value(a)		Liability Fair  Value(b)
Foreign currency contracts(c)	$	367,309	$	23,136	$	—	$	339,077	$	32,244	$	—	$	398,338	$	3,091	$	1,461
Commodity contracts(c)	1,166		—		98		1,728		—		414		1,411		—		17
Treasury rate locks(c)	300,000		3,365		—		—		—		—		—		—		—
Total	$	668,475	$	26,501	$	98	$	340,805	$	32,244	$	414	$	399,749	$	3,091	$	1,478
	June 28, 2015						December 31, 2014						June 29, 2014
Derivatives Not Designated As Hedging Instruments Under ASC Topic 815	Notional Value		Asset Fair  Value(a)		Liability Fair  Value(b)		Notional Value		Asset Fair  Value(a)		Liability Fair  Value(b)		Notional Value		Asset Fair  Value(a)		Liability Fair  Value(b)
Commodity contracts	$	8,218	$	—	$	888	$	11,804	$	—	$	1,613	$	7,754	$	68	$	—
	$	8,218	$	—	$	888	$	11,804	$	—	$	1,613	$	7,754	$	68	$	—

(a) Foreign currency and commodity contract fair value included in other current assets and Treasury rate lock fair value included in other long-term assets

(b) Included in accrued liabilities

(c) Derivative designated as a cash flow hedge

The following tables summarize the amount of gains and losses related to derivative financial instruments designated as cash flow hedges (in thousands):

	Amount of Gain/(Loss) Recognized in OCI, before tax
	Three months ended						Six months ended
Cash Flow Hedges	June 28, 2015			June 29, 2014			June 28, 2015			June 29, 2014
Foreign currency contracts	$	(4,458	)	$	3,931		$	28,210		$	2,493
Commodity contracts	(3		)	(24		)	(123		)	191
Treasury rate locks	3,365			—			3,365			—
Total	$	(1,096	)	$	3,907		$	31,452		$	2,684

	Amount of Gain/(Loss) Reclassified from AOCL into Income
	Three months ended						Six months ended						Expected to be Reclassified
Cash Flow Hedges	June 28, 2015			June 29, 2014			June 28, 2015			June 29, 2014			Over the Next Twelve Months
Foreign currency contracts(a)	$	20,131		$	(1,183	)	$	35,407		$	(2,241	)	$	23,461
Commodity contracts(a)	(125		)	87			(439		)	283			(98		)
Treasury rate locks(b)	—			—			—			—			191
Total	$	20,006		$	(1,096	)	$	34,968		$	(1,958	)	$	23,554

(a) Gain/(loss) reclassified from accumulated other comprehensive loss (AOCL) to income is included in cost of goods sold

(b) Gain/(loss) reclassified from accumulated other comprehensive loss (AOCL) to income will be included in interest expense

For the three and six months ended June 28, 2015 and June 29, 2014, the cash flow hedges were highly effective and, as a result, the amount of hedge ineffectiveness was not material. No amounts were excluded from effectiveness testing.

The following tables summarize the amount of gains and losses related to derivative financial instruments not designated as hedging instruments (in thousands):

	Amount of Gain/(Loss) Recognized in Income on Derivative
	Three months ended				Six months ended
Derivatives Not Designated As Hedges	June 28, 2015		June 29, 2014		June 28, 2015			June 29, 2014
Commodity contracts(a)	$	14	$	184	$	(526	)	$	(144	)
Total	$	14	$	184	$	(526	)	$	(144	)

(a) Gain/(loss) recognized in income is included in cost of goods sold.

The Company is exposed to credit loss risk in the event of non-performance by counterparties to these derivative financial instruments. Although no assurances can be given, the Company does not expect any of the counterparties to these derivative financial instruments to fail to meet its obligations. To manage credit loss risk, the Company evaluates counterparties based on credit ratings and, on a quarterly basis, evaluates each hedge’s net position relative to the counterparty’s ability to cover its position.

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Accumulated Other Comprehensive Income

6 Months Ended

Jun. 28, 2015

Equity [Abstract]

Accumulated Other Comprehensive Income

Accumulated Other Comprehensive Loss

The following tables set forth the changes in accumulated other comprehensive loss (AOCL) (in thousands):

	Three months ended June 28, 2015
	Foreign currency translation adjustments			Marketable securities			Derivative financial instruments			Pension and postretirement benefit plans			Total
Balance, beginning of period	$	(30,503	)	$	(767	)	$	30,114		$	(521,005	)	$	(522,161	)
Other comprehensive income (loss) before reclassifications	5,040			(204		)	(1,096		)	—			3,740
Income tax	(789		)	76			406			—			(307		)
Net other comprehensive income (loss) before reclassifications	4,251			(128		)	(690		)	—			3,433
Reclassifications:
Realized (gains) losses - foreign currency contracts(a)	—			—			(20,131		)	—			(20,131		)
Realized (gains) losses - commodities contracts(a)	—			—			125			—			125
Prior service credits(b)	—			—			—			(695		)	(695		)
Actuarial losses(b)	—			—			—			14,670			14,670
Total before tax	—			—			(20,006		)	13,975			(6,031		)
Income tax expense (benefit)	—			—			7,410			(5,177		)	2,233
Net reclassifications	—			—			(12,596		)	8,798			(3,798		)
Other comprehensive income (loss)	4,251			(128		)	(13,286		)	8,798			(365		)
Balance, end of period	$	(26,252	)	$	(895	)	$	16,828		$	(512,207	)	$	(522,526	)
	Three months ended June 29, 2014
	Foreign currency translation adjustments			Marketable securities			Derivative financial instruments			Pension and postretirement benefit plans			Total
Balance, beginning of period	$	36,274		$	(318	)	$	(1,907	)	$	(357,978	)	$	(323,929	)
Other comprehensive income (loss) before reclassifications	6,945			(117		)	3,907			—			10,735
Income tax	(1,212		)	43			(1,448		)	—			(2,617		)
Net other comprehensive income (loss) before reclassifications	5,733			(74		)	2,459			—			8,118
Reclassifications:
Realized (gains) losses - foreign currency contracts(a)	—			—			1,183			—			1,183
Realized (gains) losses - commodities contracts(a)	—			—			(87		)	—			(87		)
Prior service credits(b)	—			—			—			(684		)	(684		)
Actuarial losses(b)	—			—			—			10,323			10,323
Total before tax	—			—			1,096			9,639			10,735
Income tax benefit	—			—			(405		)	(3,570		)	(3,975		)
Net reclassifications	—			—			691			6,069			6,760
Other comprehensive income (loss)	5,733			(74		)	3,150			6,069			14,878
Balance, end of period	$	42,007		$	(392	)	$	1,243		$	(351,909	)	$	(309,051	)

	Six months ended June 28, 2015
	Foreign currency translation adjustments			Marketable securities			Derivative financial instruments			Pension and postretirement benefit plans			Total
Balance, beginning of period	$	(3,482	)	$	(700	)	$	19,042		$	(529,803	)	$	(514,943	)
Other comprehensive (loss) income before reclassifications	(24,951		)	(310		)	31,452			—			6,191
Income tax	2,181			115			(11,650		)	—			(9,354		)
Net other comprehensive (loss) income before reclassifications	(22,770		)	(195		)	19,802			—			(3,163		)
Reclassifications:
Realized (gains) losses - foreign currency contracts(a)	—			—			(35,407		)	—			(35,407		)
Realized (gains) losses - commodities contracts(a)	—			—			439			—			439
Prior service credits(b)	—			—			—			(1,390		)	(1,390		)
Actuarial losses(b)	—			—			—			29,340			29,340
Total before tax	—			—			(34,968		)	27,950			(7,018		)
Income tax expense (benefit)	—			—			12,952			(10,354		)	2,598
Net reclassifications	—			—			(22,016		)	17,596			(4,420		)
Other comprehensive (loss) income	(22,770		)	(195		)	(2,214		)	17,596			(7,583		)
Balance, end of period	$	(26,252	)	$	(895	)	$	16,828		$	(512,207	)	$	(522,526	)
	Six months ended June 29, 2014
	Foreign currency translation adjustments			Marketable securities			Derivative financial instruments			Pension and postretirement benefit plans			Total
Balance, beginning of period	$	33,326		$	(276	)	$	(1,680	)	$	(364,046	)	$	(332,676	)
Other comprehensive income (loss) before reclassifications	8,700			(184		)	2,684			—			11,200
Income tax	(19		)	68			(994		)	—			(945		)
Net other comprehensive income (loss) before reclassifications	8,681			(116		)	1,690			—			10,255
Reclassifications:
Realized (gains) losses - foreign currency contracts(a)	—			—			2,241			—			2,241
Realized (gains) losses - commodities contracts(a)	—			—			(283		)	—			(283		)
Prior service credits(b)	—			—			—			(1,368		)	(1,368		)
Actuarial losses(b)	—			—			—			20,645			20,645
Total before tax	—			—			1,958			19,277			21,235
Income tax benefit	—			—			(725		)	(7,140		)	(7,865		)
Net reclassifications	—			—			1,233			12,137			13,370
Other comprehensive income (loss)	8,681			(116		)	2,923			12,137			23,625
Balance, end of period	$	42,007		$	(392	)	$	1,243		$	(351,909	)	$	(309,051	)

(a) Amounts reclassified to net income are included in Motorcycles and Related Products cost of goods sold.

(b) Amounts reclassified are included in the computation of net periodic period cost. See Note 14 for information related to pension and postretirement benefit plans.

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Income Taxes

6 Months Ended

Jun. 28, 2015

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

The Company’s 2015 income tax rate for the six months ended June 28, 2015 was 34.9% compared to 35.3% for the same period last year.

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Earnings Per Share (Narrative) (Detail) - shares shares in Millions	3 Months Ended		6 Months Ended
	Jun. 28, 2015	Jun. 29, 2014	Jun. 28, 2015	Jun. 29, 2014
Stock Option [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Shares considered anti-dilutive and excluded from computation	1.0	0.4	0.8	0.5

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Employee Benefit Plans (Narrative) (Detail) $ in Millions	6 Months Ended
	Jun. 28, 2015 USD ($)
Compensation and Retirement Disclosure [Abstract]
Company contributions	$ 0

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Earnings Per Share (Reconciliation Of Earnings Per Share Basic And Diluted) (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 28, 2015	Jun. 29, 2014	Jun. 28, 2015	Jun. 29, 2014
Numerator:
Net income	$ 299,810	$ 354,153	$ 569,664	$ 620,070
Denominator:
Denominator for basic earnings per share - weighted-average common shares	207,650	217,762	209,115	218,367
Effect of dilutive securities - employee stock compensation plan	940	1,399	1,050	1,453
Denominator for diluted earnings per share - adjusted weighted-average shares outstanding	208,590	219,161	210,165	219,820
Basic (in dollars per share)	$ 1.44	$ 1.63	$ 2.72	$ 2.84
Diluted (in dollars per share)	$ 1.44	$ 1.62	$ 2.71	$ 2.82

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Earnings Per Share (Tables)

6 Months Ended

Jun. 28, 2015

Earnings Per Share [Abstract]

Reconciliation Of Earnings Per Share Basic And Diluted

The following table sets forth the computation for basic and diluted earnings per share (in thousands, except per share amounts):

	Three months ended				Six months ended
	June 28, 2015		June 29, 2014		June 28, 2015		June 29, 2014
Numerator:
Net income used in computing basic and diluted earnings per share	$	299,810	$	354,153	$	569,664	$	620,070
Denominator:
Denominator for basic earnings per share - weighted-average common shares	207,650		217,762		209,115		218,367
Effect of dilutive securities - employee stock compensation plan	940		1,399		1,050		1,453
Denominator for diluted earnings per share - adjusted weighted-average shares outstanding	208,590		219,161		210,165		219,820
Earnings per common share:
Basic	$	1.44	$	1.63	$	2.72	$	2.84
Diluted	$	1.44	$	1.62	$	2.71	$	2.82

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Asset-Backed Financing (Assets And Liabilities Of Variable Interest Entities) (Detail) - USD ($) $ in Thousands	3 Months Ended
	Jun. 28, 2015	Mar. 29, 2015	Jun. 29, 2014	Mar. 30, 2014	Dec. 31, 2014
Financing Receivable [Member]
Variable Interest Entity [Line Items]
Transfers Accounted for as Secured Borrowings, Assets, Carrying Amount	$ 2,375,748		$ 2,097,385		$ 1,643,701
Financing Receivable [Member] | Asset-backed Securities [Member] | SPEs [Member]
Variable Interest Entity [Line Items]
Transfers Accounted for as Secured Borrowings, Assets, Carrying Amount	2,199,018		1,893,585		1,458,602
Financing Receivable [Member] | Asset-backed U.S. Commercial Paper Conduit Facility [Member] | SPEs [Member]
Variable Interest Entity [Line Items]
Transfers Accounted for as Secured Borrowings, Assets, Carrying Amount	0		0		0
Financing Receivable [Member] | Asset-Backed Canadian Commercial Paper Conduit Facility [Member] | Variable Interest Entity, Not Primary Beneficiary [Member]
Variable Interest Entity [Line Items]
Transfers Accounted for as Secured Borrowings, Assets, Carrying Amount	176,730		203,800		185,099
Allowance for Credit Loss [Member]
Variable Interest Entity [Line Items]
Transfers Accounted for as Secured Borrowings, Associated Liabilities, Carrying Amount	(52,057)		(42,564)		(35,121)
Allowance for Credit Loss [Member] | Asset-backed Securities [Member] | SPEs [Member]
Variable Interest Entity [Line Items]
Transfers Accounted for as Secured Borrowings, Associated Liabilities, Carrying Amount	(49,400)		(39,329)		(32,156)
Allowance for Credit Loss [Member] | Asset-backed U.S. Commercial Paper Conduit Facility [Member] | SPEs [Member]
Variable Interest Entity [Line Items]
Transfers Accounted for as Secured Borrowings, Associated Liabilities, Carrying Amount	0		0		0
Allowance for Credit Loss [Member] | Asset-Backed Canadian Commercial Paper Conduit Facility [Member] | Variable Interest Entity, Not Primary Beneficiary [Member]
Variable Interest Entity [Line Items]
Transfers Accounted for as Secured Borrowings, Associated Liabilities, Carrying Amount	(2,657)		(3,235)		(2,965)
Restricted Cash [Member]
Variable Interest Entity [Line Items]
Transfers Accounted for as Secured Borrowings, Assets, Carrying Amount	162,211		154,681		122,052
Restricted Cash [Member] | Asset-backed Securities [Member] | SPEs [Member]
Variable Interest Entity [Line Items]
Transfers Accounted for as Secured Borrowings, Assets, Carrying Amount	149,418		141,146		110,017
Restricted Cash [Member] | Asset-backed U.S. Commercial Paper Conduit Facility [Member] | SPEs [Member]
Variable Interest Entity [Line Items]
Transfers Accounted for as Secured Borrowings, Assets, Carrying Amount	0		0		0
Restricted Cash [Member] | Asset-Backed Canadian Commercial Paper Conduit Facility [Member] | Variable Interest Entity, Not Primary Beneficiary [Member]
Variable Interest Entity [Line Items]
Transfers Accounted for as Secured Borrowings, Assets, Carrying Amount	12,793		13,535		12,035
Other Assets [Member]
Variable Interest Entity [Line Items]
Transfers Accounted for as Secured Borrowings, Assets, Carrying Amount	3,407		2,761		3,671
Other Assets [Member] | Asset-backed Securities [Member] | SPEs [Member]
Variable Interest Entity [Line Items]
Transfers Accounted for as Secured Borrowings, Assets, Carrying Amount	2,857		2,342		2,987
Other Assets [Member] | Asset-backed U.S. Commercial Paper Conduit Facility [Member] | SPEs [Member]
Variable Interest Entity [Line Items]
Transfers Accounted for as Secured Borrowings, Assets, Carrying Amount	210		179		422
Other Assets [Member] | Asset-Backed Canadian Commercial Paper Conduit Facility [Member] | Variable Interest Entity, Not Primary Beneficiary [Member]
Variable Interest Entity [Line Items]
Transfers Accounted for as Secured Borrowings, Assets, Carrying Amount	340		240		262
Assets, Total [Member]
Variable Interest Entity [Line Items]
Transfers Accounted for as Secured Borrowings, Assets, Carrying Amount	2,489,309		2,212,263		1,734,303
Assets, Total [Member] | Asset-backed Securities [Member] | SPEs [Member]
Variable Interest Entity [Line Items]
Transfers Accounted for as Secured Borrowings, Assets, Carrying Amount	2,301,893		1,997,744		1,539,450
Assets, Total [Member] | Asset-backed U.S. Commercial Paper Conduit Facility [Member] | SPEs [Member]
Variable Interest Entity [Line Items]
Transfers Accounted for as Secured Borrowings, Assets, Carrying Amount	210		179		422
Assets, Total [Member] | Asset-Backed Canadian Commercial Paper Conduit Facility [Member] | Variable Interest Entity, Not Primary Beneficiary [Member]
Variable Interest Entity [Line Items]
Transfers Accounted for as Secured Borrowings, Assets, Carrying Amount	187,206		214,340		194,431
Asset-backed debt [Member]
Variable Interest Entity [Line Items]
Transfers Accounted for as Secured Borrowings, Assets, Carrying Amount	2,178,019		1,886,079		1,438,445
Asset-backed debt [Member] | Asset-backed Securities [Member] | SPEs [Member]
Variable Interest Entity [Line Items]
Transfers Accounted for as Secured Borrowings, Assets, Carrying Amount	2,017,079		1,712,855		1,271,533
Asset-backed debt [Member] | Asset-backed U.S. Commercial Paper Conduit Facility [Member] | SPEs [Member]
Variable Interest Entity [Line Items]
Transfers Accounted for as Secured Borrowings, Assets, Carrying Amount	0		0		0
Asset-backed debt [Member] | Asset-Backed Canadian Commercial Paper Conduit Facility [Member] | Variable Interest Entity, Not Primary Beneficiary [Member]
Variable Interest Entity [Line Items]
Transfers Accounted for as Secured Borrowings, Assets, Carrying Amount	160,940		173,224		$ 166,912
Asset-Backed Canadian Commercial Paper Conduit Facility [Member] | Foreign Line of Credit [Member] | Variable Interest Entity, Not Primary Beneficiary [Member]
Variable Interest Entity [Line Items]
Certain Loans Acquired in Transfer Not Accounted for as Debt Securities, Acquired During Period, Contractually Required Payments Receivable at Acquisition	26,800	$ 19,200	26,400	$ 15,700
Line of Credit [Member] | Asset-Backed Canadian Commercial Paper Conduit Facility [Member] | Foreign Line of Credit [Member] | Variable Interest Entity, Not Primary Beneficiary [Member]
Variable Interest Entity [Line Items]
Cash Flows Between Transferor and Transferee, Proceeds from New Transfers	$ 23,400	$ 16,800	$ 23,100	$ 13,800

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Commitment and Contingencies

6 Months Ended

Jun. 28, 2015

Commitments and Contingencies Disclosure [Abstract]

Commitment and Contingencies

Commitments and Contingencies

The Company is subject to lawsuits and other claims related to environmental, product and other matters. In determining required reserves related to these items, the Company carefully analyzes cases and considers the likelihood of adverse judgments or outcomes, as well as the potential range of possible loss. The required reserves are monitored on an ongoing basis and are updated based on new developments or new information in each matter.

Environmental Protection Agency Notice

In December 2009, the Company received formal, written requests for information from the United States Environmental Protection Agency (EPA) regarding: (i) certificates of conformity for motorcycle emissions and related designations and labels, (ii) aftermarket parts, and (iii) warranty claims on emissions related components. The Company promptly submitted written responses to the EPA’s inquiry and has engaged in discussions with the EPA. Since that time, the EPA has delivered various additional requests for information to which the Company has responded. It is probable that a result of the EPA’s investigation will be some form of enforcement action by the EPA that will seek a fine and/or other relief. The Company has a reserve associated with this matter which is included in accrued liabilities in the Consolidated Balance Sheet. However, given the uncertainty that still exists concerning the resolution of this matter, there is a possibility that the actual loss incurred may be materially different than the Company’s current reserve. At this time, the Company cannot reasonably estimate the impact of any remedies the EPA might seek beyond the Company's current reserve for this matter, if any.

York Environmental Matters:

The Company is involved with government agencies and groups of potentially responsible parties in various environmental matters, including a matter involving the cleanup of soil and groundwater contamination at its York, Pennsylvania facility. The York facility was formerly used by the U.S. Navy and AMF prior to the purchase of the York facility by the Company from AMF in 1981. Although the Company is not certain as to the full extent of the environmental contamination at the York facility, it has been working with the Pennsylvania Department of Environmental Protection (PADEP) since 1986 in undertaking environmental investigation and remediation activities, including an ongoing site-wide remedial investigation/feasibility study (RI/FS). In January 1995, the Company entered into a settlement agreement (the Agreement) with the Navy, and the parties amended the Agreement in 2013 to address ordnance and explosive waste.

The Agreement calls for the Navy and the Company to contribute amounts into a trust equal to 53% and 47%, respectively, of future costs associated with environmental investigation and remediation activities at the York facility (Response Costs). The trust administers the payment of the Response Costs incurred at the York facility as covered by the Agreement.

The Company has a reserve for its estimate of its share of the future Response Costs at the York facility which is included in accrued liabilities in the Condensed Consolidated Balance Sheets. As noted above, the RI/FS is still underway and given the uncertainty that exists concerning the nature and scope of additional environmental investigation and remediation that may ultimately be required under the RI/FS or otherwise at the York facility, the Company is unable to make a reasonable estimate of those additional costs, if any, that may result.

The estimate of the Company’s future Response Costs that will be incurred at the York facility is based on reports of independent environmental consultants retained by the Company, the actual costs incurred to date and the estimated costs to complete the necessary investigation and remediation activities. Response Costs are expected to be paid primarily over a period of several years ending in 2017 although certain Response Costs may continue for some time beyond 2017.

Product Liability Matters:

The Company is involved in product liability suits related to the operation of its business. The Company accrues for claim exposures that are probable of occurrence and can be reasonably estimated. The Company also maintains insurance coverage for product liability exposures. The Company believes that its accruals and insurance coverage are adequate and that product liability suits will not have a material adverse effect on the Company’s consolidated financial statements.

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Asset-Backed Financing (Tables)

6 Months Ended

Jun. 28, 2015

Secured Debt [Abstract]

Assets and Liabilities Of Variable Interest Entities

The following table shows the assets and liabilities related to the asset-backed financings that were included in the financial statements (in thousands):

	June 28, 2015
	Finance receivables		Allowance for credit losses			Restricted cash		Other assets		Total assets		Asset-backed debt
On-balance sheet assets and liabilities
Consolidated VIEs
Term asset-backed securitizations	$	2,199,018	$	(49,400	)	$	149,418	$	2,857	$	2,301,893	$	2,017,079
Asset-backed U.S. commercial paper conduit facility	—		—			—		210		210		—
Unconsolidated VIEs
Asset-backed Canadian commercial paper conduit facility	176,730		(2,657		)	12,793		340		187,206		160,940
Total on-balance sheet assets and liabilities	$	2,375,748	$	(52,057	)	$	162,211	$	3,407	$	2,489,309	$	2,178,019
	December 31, 2014
	Finance receivables		Allowance for credit losses			Restricted cash		Other assets		Total assets		Asset-backed debt
On-balance sheet assets and liabilities
Consolidated VIEs
Term asset-backed securitizations	$	1,458,602	$	(32,156	)	$	110,017	$	2,987	$	1,539,450	$	1,271,533
Asset-backed U.S. commercial paper conduit facility	—		—			—		422		422		—
Unconsolidated VIEs
Asset-backed Canadian commercial paper conduit facility	185,099		(2,965		)	12,035		262		194,431		166,912
Total on-balance sheet assets and liabilities	$	1,643,701	$	(35,121	)	$	122,052	$	3,671	$	1,734,303	$	1,438,445
	June 29, 2014
	Finance receivables		Allowance for credit losses			Restricted cash		Other assets		Total assets		Asset-backed debt
On-balance sheet assets and liabilities
Consolidated VIEs
Term asset-backed securitizations	$	1,893,585	$	(39,329	)	$	141,146	$	2,342	$	1,997,744	$	1,712,855
Asset-backed U.S. commercial paper conduit facility	—		—			—		179		179		—
Unconsolidated VIEs
Asset-backed Canadian commercial paper conduit facility	203,800		(3,235		)	13,535		240		214,340		173,224
Total on-balance sheet assets and liabilities	$	2,097,385	$	(42,564	)	$	154,681	$	2,761	$	2,212,263	$	1,886,079

XML

Finance Receivables (Recorded Investment Of Retail and Wholesale Finance Receivables By Credit Quality Indicator) (Detail) - USD ($) $ in Thousands	Jun. 28, 2015	Dec. 31, 2014	Jun. 29, 2014
Accounts, Notes, Loans and Financing Receivable [Line Items]
Financing Receivable, Gross	$ 7,287,726	$ 6,560,245	$ 6,941,272
Retail [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Financing Receivable, Gross	5,962,685	5,607,924	5,603,187
Retail [Member] | Prime [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Financing Receivable, Gross	4,718,363	4,435,352	4,407,364
Retail [Member] | Sub-Prime [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Financing Receivable, Gross	1,244,322	1,172,572	1,195,823
Wholesale [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Financing Receivable, Gross	1,325,041	952,321	1,338,085
Wholesale [Member] | Doubtful [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Financing Receivable, Gross	0	954	4,916
Wholesale [Member] | Substandard [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Financing Receivable, Gross	7,739	7,025	4,192
Wholesale [Member] | Special Mention [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Financing Receivable, Gross	15,343	0	0
Wholesale [Member] | Risk Level, Medium [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Financing Receivable, Gross	3,245	11,557	16,202
Wholesale [Member] | Risk Level, Low [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Financing Receivable, Gross	$ 1,298,714	$ 932,785	$ 1,312,775

XML

Additional Balance Sheet and Cash Flow Information (Narrative) (Detail) - USD ($)	6 Months Ended
	Jun. 28, 2015	Jun. 29, 2014
Supplemental Cash Flow Information [Abstract]
Document Fiscal Year Focus	2015
Gross unrealized gains (losses)	$ (310,000)	$ (184,000)
Gross unrealized gains (losses), net of taxes	$ (195,000)	$ (116,000)
Contractual maturities period of marketable securities, minimum (in months)	3 months
Contractual maturities period of marketable securities, maximum (in months)	22 months

XML

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	6 Months Ended
	Jun. 28, 2015	Jun. 29, 2014
Net cash provided by operating activities	$ 613,944	$ 570,592
Cash flows from investing activities:
Capital expenditures	(85,180)	(74,523)
Origination of finance receivables	(1,976,563)	(1,904,577)
Collections on finance receivables	1,570,431	1,518,186
Sales and redemptions of marketable securities	4,500	41,010
Other	5,111	145
Net cash used by investing activities	(481,701)	(419,759)
Cash flows from financing activities:
Repayments of Unsecured Debt	0	(303,000)
Proceeds from Issuance of Medium-term Notes	595,386	0
Repayments of Medium-term Notes	0	7,220
Proceeds from Securitization Debt	1,195,668	847,126
Repayments of Securitization Debt	454,332	393,655
Proceeds from (Repayments of) Credit Facility and Other Unsecured Debt	(616,586)	(48,134)
Borrowings of asset-backed commercial paper	40,209	36,800
Repayments of asset-backed commercial paper	(35,730)	(37,317)
Net change in restricted cash	(40,159)	(9,874)
Dividends paid	(129,745)	(120,631)
Purchase of common stock for treasury	(358,425)	(223,736)
Excess tax benefits from share-based payments	2,401	8,652
Issuance of common stock under employee stock option plans	15,664	27,907
Net cash provided by (used by) financing activities	214,351	(223,082)
Effect of exchange rate changes on cash and cash equivalents	(5,695)	4,983
Net increase (decrease) in cash and cash equivalents	340,899	(67,266)
Cash and cash equivalents:
Cash and cash equivalents—beginning of period	906,680	1,066,612
Net increase (decrease) in cash and cash equivalents	340,899	(67,266)
Cash and cash equivalents—end of period	1,247,579	999,346
Financial Services Operations [Member]
Net cash provided by operating activities	573,421	547,919
Cash flows from investing activities:
Capital expenditures	(1,898)	(3,128)
Origination of finance receivables	(4,526,313)	(4,580,910)
Collections on finance receivables	3,707,444	3,684,319
Sales and redemptions of marketable securities	0	0
Other	0	0
Net cash used by investing activities	(820,767)	(899,719)
Cash flows from financing activities:
Repayments of Unsecured Debt		0
Proceeds from Issuance of Medium-term Notes	595,386
Repayments of Medium-term Notes		7,220
Proceeds from Securitization Debt	1,195,668
Repayments of Securitization Debt	454,332	393,655
Proceeds from (Repayments of) Credit Facility and Other Unsecured Debt	(616,586)	(48,134)
Repayments of asset-backed commercial paper		(37,317)
Net change in restricted cash	(40,159)	(9,874)
Dividends paid	(100,000)	(120,000)
Purchase of common stock for treasury	0	0
Excess tax benefits from share-based payments	0	0
Issuance of common stock under employee stock option plans	0	0
Net cash provided by (used by) financing activities	334,456	367,726
Effect of exchange rate changes on cash and cash equivalents	(605)	15
Net increase (decrease) in cash and cash equivalents	86,505	15,941
Cash and cash equivalents:
Cash and cash equivalents—beginning of period	332,785	347,700
Net increase (decrease) in cash and cash equivalents	86,505	15,941
Cash and cash equivalents—end of period	419,290	363,641
Motorcycles And Related Products Operations [Member]
Net cash provided by operating activities	553,260	652,873
Cash flows from investing activities:
Capital expenditures	(83,282)	(71,395)
Origination of finance receivables	0	0
Collections on finance receivables	0	0
Sales and redemptions of marketable securities	4,500	41,010
Other	5,111	145
Net cash used by investing activities	(73,671)	(30,240)
Cash flows from financing activities:
Repayments of Unsecured Debt		(303,000)
Proceeds from Issuance of Medium-term Notes	0
Repayments of Medium-term Notes		0
Proceeds from Securitization Debt	0
Repayments of Securitization Debt	0	0
Proceeds from (Repayments of) Credit Facility and Other Unsecured Debt	0	0
Repayments of asset-backed commercial paper		0
Net change in restricted cash	0	0
Dividends paid	(129,745)	(120,631)
Purchase of common stock for treasury	(358,425)	(223,736)
Excess tax benefits from share-based payments	2,401	8,652
Issuance of common stock under employee stock option plans	15,664	27,907
Net cash provided by (used by) financing activities	(220,105)	(710,808)
Effect of exchange rate changes on cash and cash equivalents	(5,090)	4,968
Net increase (decrease) in cash and cash equivalents	254,394	(83,207)
Cash and cash equivalents:
Cash and cash equivalents—beginning of period	573,895	718,912
Net increase (decrease) in cash and cash equivalents	254,394	(83,207)
Cash and cash equivalents—end of period	$ 828,289	$ 635,705

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Asset-Backed Financing

6 Months Ended

Jun. 28, 2015

Secured Debt [Abstract]

Debt Disclosure [Text Block]

Asset-Backed Financing

The Company participates in asset-backed financing through both term asset-backed securitization transactions and through asset-backed commercial paper conduit facilities. The Company treats these transactions as secured borrowings because either they are transferred to consolidated variable interest entities (VIEs) or the Company maintains effective control over the assets and does not meet the accounting sale requirements under ASC Topic 860, "Transfers and Servicing" (ASC Topic 860). In the Company's asset-backed financing programs, the Company transfers retail motorcycle finance receivables to special purpose entities (SPE), which are considered VIEs under U.S. GAAP. Each SPE then converts those assets into cash, through the issuance of debt.

The Company is required to consolidate any VIE in which it is deemed to be the primary beneficiary through having power over the significant activities of the entity and having an obligation to absorb losses or the right to receive benefits from the VIE which are potentially significant to the VIE. The Company is considered to have the power over the significant activities of its term asset-backed securitization and asset-backed U.S. commercial paper conduit facility VIEs due to its role as servicer. Servicing fees are typically not considered potentially significant variable interests in a VIE. However, the Company retains a residual interest in the VIEs in the form of a debt security, which gives the Company the right to receive benefits that could be potentially significant to the VIE. Therefore, the Company is the primary beneficiary and consolidates all of these VIEs within its consolidated financial statements.

The Company is not the primary beneficiary of the asset-backed Canadian commercial paper conduit facility VIE; therefore, the Company does not consolidate this VIE. However, the Company treats the conduit facility as a secured borrowing as it maintains effective control over the assets transferred to the VIE and therefore does not meet the requirements for sale accounting under ASC Topic 860. As such, the Company retains the transferred assets and the related debt within its Consolidated Balance Sheet.

Servicing fees paid by VIEs to the Company are eliminated in consolidation and therefore are not recorded on a consolidated basis. The Company is not required, and does not currently intend, to provide any additional financial support to its VIEs. Investors and creditors only have recourse to the assets held by the VIEs.

The following table shows the assets and liabilities related to the asset-backed financings that were included in the financial statements (in thousands):

	June 28, 2015
	Finance receivables		Allowance for credit losses			Restricted cash		Other assets		Total assets		Asset-backed debt
On-balance sheet assets and liabilities
Consolidated VIEs
Term asset-backed securitizations	$	2,199,018	$	(49,400	)	$	149,418	$	2,857	$	2,301,893	$	2,017,079
Asset-backed U.S. commercial paper conduit facility	—		—			—		210		210		—
Unconsolidated VIEs
Asset-backed Canadian commercial paper conduit facility	176,730		(2,657		)	12,793		340		187,206		160,940
Total on-balance sheet assets and liabilities	$	2,375,748	$	(52,057	)	$	162,211	$	3,407	$	2,489,309	$	2,178,019
	December 31, 2014
	Finance receivables		Allowance for credit losses			Restricted cash		Other assets		Total assets		Asset-backed debt
On-balance sheet assets and liabilities
Consolidated VIEs
Term asset-backed securitizations	$	1,458,602	$	(32,156	)	$	110,017	$	2,987	$	1,539,450	$	1,271,533
Asset-backed U.S. commercial paper conduit facility	—		—			—		422		422		—
Unconsolidated VIEs
Asset-backed Canadian commercial paper conduit facility	185,099		(2,965		)	12,035		262		194,431		166,912
Total on-balance sheet assets and liabilities	$	1,643,701	$	(35,121	)	$	122,052	$	3,671	$	1,734,303	$	1,438,445
	June 29, 2014
	Finance receivables		Allowance for credit losses			Restricted cash		Other assets		Total assets		Asset-backed debt
On-balance sheet assets and liabilities
Consolidated VIEs
Term asset-backed securitizations	$	1,893,585	$	(39,329	)	$	141,146	$	2,342	$	1,997,744	$	1,712,855
Asset-backed U.S. commercial paper conduit facility	—		—			—		179		179		—
Unconsolidated VIEs
Asset-backed Canadian commercial paper conduit facility	203,800		(3,235		)	13,535		240		214,340		173,224
Total on-balance sheet assets and liabilities	$	2,097,385	$	(42,564	)	$	154,681	$	2,761	$	2,212,263	$	1,886,079

Term Asset-Backed Securitization VIEs

The Company transfers U.S. retail motorcycle finance receivables to SPEs which in turn issue secured notes to investors, with various maturities and interest rates, secured by future collections of the purchased U.S. retail motorcycle finance receivables. Each term asset-backed securitization SPE is a separate legal entity and the U.S. retail motorcycle finance receivables included in the term asset-backed securitizations are only available for payment of the secured debt and other obligations arising from the term asset-backed securitization transaction and are not available to pay other obligations or claims of the Company’s creditors until the associated secured debt and other obligations are satisfied. Restricted cash balances held by the SPEs are used only to support the securitizations. There are no amortization schedules for the secured notes; however, the debt is reduced monthly as available collections on the related U.S. retail motorcycle finance receivables are applied to outstanding principal. The secured notes’ contractual lives have various maturities ranging from 2015 to 2022.

During the second quarter of 2015, the Company issued $500.0 million of secured notes through one term asset-backed securitization transaction. The Company also issued $700.0 million of secured notes through one term asset-backed securitization transaction during the first quarter of 2015. During the second quarter of 2014, the Company issued $850.0 million of secured notes through one term asset-backed securitization transaction. There were no other term asset-backed securitization transactions during the six months ended June 29, 2014.

Asset-Backed U.S. Commercial Paper Conduit Facility VIE

In September 2014, the Company amended and restated its facility (U.S. Conduit) with a third-party bank sponsored asset-backed commercial paper conduit, which provides for a total aggregate commitment of $600.0 million based on, among other things, the amount of eligible U.S. retail motorcycle loans held by a SPE as collateral. Under the facility, the Company may transfer U.S. retail motorcycle finance receivables to a SPE, which in turn may issue debt to third-party bank-sponsored asset-backed commercial paper conduits.

The assets of the SPE are restricted as collateral for the payment of the debt or other obligations arising in the transaction and are not available to pay other obligations or claims of the Company’s creditors. The terms for this debt provide for interest on the outstanding principal generally based on prevailing commercial paper rates plus a program fee based on outstanding principal, or LIBOR plus a specified margin to the extent the advance is not funded by a conduit lender through the issuance of commercial paper. The U.S. Conduit also provides for an unused commitment fee based on the unused portion of the total aggregate commitment of $600.0 million. There is no amortization schedule; however, the debt is reduced monthly as available collections on the related finance receivables are applied to outstanding principal. Upon expiration of the U.S. Conduit, any outstanding principal will continue to be reduced monthly through available collections. Unless earlier terminated or extended by mutual agreement of the Company and the lenders, the U.S. Conduit has an expiration date of October 30, 2015.

The SPE had no borrowings outstanding under the U.S. Conduit at June 28, 2015, December 31, 2014 or June 29, 2014; therefore, U.S. Conduit assets are restricted as collateral for the payment of fees associated with the unused portion of the total aggregate commitment.

Asset-Backed Canadian Commercial Paper Conduit Facility

In June 2014, the Company amended its facility agreement (Canadian Conduit) with a Canadian bank-sponsored asset-backed commercial paper conduit. Under the agreement, the Canadian Conduit is contractually committed, at the Company's option, to purchase eligible Canadian retail motorcycle finance receivables for proceeds up to C$200.0 million. The transferred assets are restricted as collateral for the payment of the debt. The terms for this debt provide for interest on the outstanding principal based on prevailing market interest rates plus a specified margin. The Canadian Conduit also provides for a program fee and an unused commitment fee based on the unused portion of the total aggregate commitment of C$200.0 million. There is no amortization schedule; however, the debt is reduced monthly as available collections on the related finance receivables are applied to outstanding principal. Upon expiration of the Canadian Conduit, any outstanding principal will continue to be reduced monthly through available collections. Unless earlier terminated or extended by mutual agreement of the Company and the lenders, as of June 28, 2015, the Canadian Conduit had an expiration date of June 30, 2015. The Canadian Conduit was renewed on June 30, 2015 with similar terms and a borrowing amount of up to C$240.0 million with an expiration date of June 30, 2016. The contractual maturity of the debt is approximately 5 years.

As the Company participates in and does not consolidate the Canadian bank-sponsored, multi-seller conduit VIE, the maximum exposure to loss associated with this VIE, which would only be incurred in the unlikely event that all the finance receivables and underlying collateral have no residual value, was $26.3 million at June 28, 2015. The maximum exposure is not an indication of the Company's expected loss exposure.

During the second and first quarters of 2015, the Company transferred $26.8 million and $19.2 million of Canadian retail motorcycle finance receivables to the Canadian Conduit for proceeds of $23.4 million and $16.8 million, respectively. During the second and first quarters of 2014, HDFS transferred $26.4 million and $15.7 million of Canadian retail motorcycle finance receivables to the Canadian Conduit for proceeds of $23.1 million and $13.8 million, respectively. The transferred assets are restricted as collateral for the payment of the debt.

Debt

Debt with contractual terms less than one year is generally classified as short-term debt and consisted of the following (in thousands):

	June 28, 2015		December 31, 2014		June 29, 2014
Unsecured commercial paper	$	114,983	$	731,786	$	619,622

Debt with a contractual term greater than one year is generally classified as long-term debt and consisted of the following (in thousands):

	June 28, 2015			December 31, 2014			June 29, 2014
Secured debt
Asset-backed Canadian commercial paper conduit facility	$	160,940		$	166,912		$	173,224
Term asset-backed securitization debt	2,017,079			1,271,533			1,712,855
Unsecured notes
5.75% Medium-term notes due in 2014 ($500.0 million par value)	—			—			499,946
1.15% Medium-term notes due in 2015 ($600.0 million par value)	599,954			599,817			599,680
3.88% Medium-term notes due in 2016 ($450.0 million par value)	449,964			449,937			449,910
2.70% Medium-term notes due in 2017 ($400.0 million par value)	399,972			399,963			399,955
1.55% Medium-term notes due in 2017 ($400.0 million par value)	399,557			399,464			—
6.80% Medium-term notes due in 2018 ($888.0 million par value)	887,467			887,381			903,741
2.40% Medium-term notes due in 2019 ($600.0 million par value)	598,066			597,836			—
2.15% Medium-term notes due in 2020 ($600.0 million par value)	598,718			—			—
Gross long-term debt	6,111,717			4,772,843			4,739,311
Less: current portion of long-term debt	(1,551,368		)	(1,011,315		)	(944,915		)
Long-term debt	$	4,560,349		$	3,761,528		$	3,794,396

During the first and second quarters of 2015, the Company issued $700.0 million and $500.0 million, respectively, of secured notes through term asset-backed securitization transactions. During the second quarter of 2014, the Company issued $850.0 million of secured notes through one term asset-backed securitization transaction. There were no other term asset-backed securitization transactions during the six months ended June 29, 2014. The term asset-backed securitization transactions are further discussed in Note 5.

There were no medium-term notes issued or repurchased during the second quarter of 2015. During the first quarter of 2015, the Company issued $600.0 million of medium-term notes which mature in February 2020 and have an annual interest rate of 2.15%. There were no medium-term notes issued during the six months ended June 29, 2014. During the second quarter of 2014, HDFS repurchased an aggregate of $6.1 million of its 6.80% medium-term notes which mature in June 2018. As a result, HDFS recognized in financial services interest expense $1.1 million of loss on the extinguishment of debt, which included unamortized discounts and fees.

XML

Debt Debt (Debt With Contractual Term Less Than One Year)(Details) - USD ($) $ in Thousands	Jun. 28, 2015	Dec. 31, 2014	Jun. 29, 2014
Short-term Debt [Line Items]
Short-term debt	$ 114,983	$ 731,786	$ 619,622
Commercial Paper [Member]
Short-term Debt [Line Items]
Short-term debt	$ 114,983	$ 731,786	$ 619,622

XML

Commitment And Contingencies (Detail) - York, Pennsylvania Facility [Member]	6 Months Ended
	Jun. 28, 2015
Site Contingency [Line Items]
Site contingency third party cost percentage of total cost	53.00%
Site contingency portion of total cost	47.00%

XML

Fair Value Measurements (Tables)

6 Months Ended

Jun. 28, 2015

Fair Value Disclosures [Abstract]

Summary Of Assets And Liabilities Measured At Fair Value On A Recurring Basis

The following tables present information about the Company’s assets and liabilities measured at fair value on a recurring basis (in thousands):

	June 28, 2015
	Balance		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets:
Cash equivalents	$	1,030,928	$	558,660	$	472,268	$	—
Marketable securities	90,214		37,698		52,516		—
Derivatives	26,501		—		26,501		—
	$	1,147,643	$	596,358	$	551,285	$	—
Liabilities:
Derivatives	$	986	$	—	$	986	$	—
	December 31, 2014
	Balance		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets:
Cash equivalents	$	737,024	$	482,686	$	254,338	$	—
Marketable securities	91,140		33,815		57,325		—
Derivatives	32,244		—		32,244		—
	$	860,408	$	516,501	$	343,907	$	—
Liabilities:
Derivatives	$	2,027	$	—	$	2,027	$	—
	June 29, 2014
	Balance		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets:
Cash equivalents	$	660,520	$	482,780	$	177,740	$	—
Marketable securities	91,381		33,567		57,814		—
Derivatives	3,159		—		3,159		—
	$	755,060	$	516,347	$	238,713	$	—
Liabilities:
Derivatives	$	1,478	$	—	$	1,478	$	—

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Subsequent Events Long-Term Debt (Details) - USD ($) $ in Thousands	Jul. 23, 2015	Jun. 28, 2015	Dec. 31, 2014	Jun. 29, 2014
Subsequent Event [Line Items]
Gross Long-term Debt		$ 6,111,717	$ 4,772,843	$ 4,739,311
Subsequent Event [Member]
Subsequent Event [Line Items]
Gross Long-term Debt	$ 750,000
Senior Unsecured Notes due 2025 [Domain] | Subsequent Event [Member]
Subsequent Event [Line Items]
Debt Instrument, Interest Rate, Stated Percentage	3.50%
Gross Long-term Debt	$ 450,000
Senior Unsecured Notes due 2045 [Domain] | Subsequent Event [Member]
Subsequent Event [Line Items]
Debt Instrument, Interest Rate, Stated Percentage	4.625%
Gross Long-term Debt	$ 300,000

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Basis Of Presentation And Use Of Estimates Narrative (Details)	6 Months Ended
	Jun. 28, 2015 segment
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Number of businss segments	2

XML

Business Segments

6 Months Ended

Jun. 28, 2015

Segment Reporting [Abstract]

Business Segments

Business 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. Selected segment information is set forth below (in thousands):

	Three months ended				Six months ended
	June 28, 2015		June 29, 2014		June 28, 2015		June 29, 2014
Motorcycles net revenue	$	1,650,783	$	1,834,285	$	3,161,353	$	3,405,973
Gross profit	647,214		724,139		1,237,489		1,316,270
Selling, administrative and engineering expense	266,611		250,883		511,432		495,322
Operating income from Motorcycles	380,603		473,256		726,057		820,948
Financial Services revenue	173,609		166,414		335,984		320,774
Financial Services expense	91,696		91,975		189,407		183,145
Operating income from Financial Services	81,913		74,439		146,577		137,629
Operating income	$	462,516	$	547,695	$	872,634	$	958,577