PRESS RELEASE

Harley-Davidson, Inc. Announces Record First Quarter Sales and Earnings

14 April 1997

    MILWAUKEE, April 14 -- Harley-Davidson, Inc.
today announced record sales and earnings for its first quarter ended March
30, 1997.
    For the quarter, net sales totaled $427.1 million, a $56.0 million or
15.1 percent increase compared to the year-ago quarter.  Net income and
earnings per share were $40.3 million and 53 cents on 75.7 million shares
outstanding versus $33.0 million and 44 cents on 75.1 million shares,
increases of 22.3 percent and 21.3 percent, respectively.
    Compared to the year-ago quarter, the improved results are due to an
increase in motorcycle unit shipments, improved manufacturing efficiencies,
and higher sales in the Parts and Accessories business and the General
Merchandise business.  First quarter Harley-Davidson motorcycle unit shipments
totaled 32,860 units, up 2,789 units or 9.3 percent from a year ago.  Parts
and Accessories sales totaled $54.4 million, a $7.2 million or 15.1 percent
increase.  General merchandise sales totaled $24.5 million, a $3.5 million or
16.9 percent increase.
    "We have consistently met our revenue and earnings growth objectives,"
said Rich Teerlink, chairman and chief executive officer of Harley-Davidson,
Inc.  "This quarter's record performance once again demonstrates that we are
on course with our long term plan.  We have increased our motorcycle
production rate for the second quarter and are scheduled to average 535 units
per day.  Our 1997 production target remains at 130,000 units, which will
provide double-digit motorcycle revenue growth."
    "Our manufacturing facilities continue to run smoothly as our daily
production averaged 527 units for the first quarter, above the scheduled 520
units per day," said Teerlink.  "We also benefited in the first quarter by
eliminating the excess inventory in our French and German subsidiaries.  In
addition, we experienced a reduction in finished goods inventory at our York,
Pa. plant, although we expect this inventory to build back up to normal levels
during the second quarter."
    During the first quarter the Motor Company incurred two non-recurring
expenses.  Product liability expenses were $3 million higher in the first
quarter when compared to the year-ago quarter.  The primary contributor to
this higher expense was an out-of-court settlement made during the first
quarter.  Also, a one-time $2 million signing bonus was paid to the
union-represented employees at Harley-Davidson's York, PA operations as part
of a new five-year labor agreement.
    Operating profit for the Motorcycle segment was $63.0 million or 14.8% of
revenue, after the two non-recurring charges mentioned above.  The operating
margin improvement for the first quarter is due to a greater mix of custom
motorcycles, a greater mix of international units sold through wholly owned
distributors, and the continued smooth execution of production capacity
expansion.  "As we have said in the past, gross margins in 1997 will improve
and these improvements will be reinvested in information systems, product
development, and distribution initiatives," Teerlink said.  "We still expect
the 1997 full-year operating margin to be at the 1996 level."

    Market Review
    Year-end 1996 data show that in the U.S. 651+cc market, Harley-Davidson
holds a 48.2 percent market share, compared to 47.7 percent in the year-ago
period.  The U.S. 651+cc market grew at a 9.6 percent rate in 1996.
    "The demand for Harley-Davidson motorcycles in the U.S. continues to
exceed the supply allocated to our U.S. dealers," Teerlink said.  "This has
resulted in long waits for customers to purchase new Harley-Davidson
motorcycles at or near manufacturer's suggested retail price.  Our objective
is to narrow the gap between demand and supply so our customers do not have to
wait so long.  Ideally, we would like to have new Harley-Davidson motorcycles
on each dealer's showroom floor so potential customers can visit their local
dealer to see a sample of the new models."
    European data for year-end 1996 show Harley-Davidson holding a 6.8 percent
share of the 651+cc market, down from 7.4 percent in 1995.  The European
651+cc market grew at an 8.4 percent rate in 1996.  "The initial indications
of our European initiatives look encouraging," said Teerlink.  "According to
our in-house retail tracking systems, all countries except Germany are showing
higher motorcycle registrations for the first quarter of 1997 compared to last
year."

    Parts and Accessories
    First quarter Genuine Motor Parts and Genuine Motor Accessories (P&A)
sales totaled $54.4 million, a $7.2 million or 15.1 percent increase from the
year-ago quarter.  "We experienced a few problems in the fourth quarter, but
rebounded nicely in the first quarter,"  Teerlink said.  "As we have said in
the past, we may experience quarter-to-quarter fluctuations, but we still
expect the long-term growth in P&A revenue to approximate the growth rate in
motorcycle revenue."

    General Merchandise
    General Merchandise, which consists of MotorClothes apparel and
collectibles, sales of $24.5 million were up $3.5 million or a 16.9 percent
increase from the year-ago quarter.  "The increase is primarily due to filling
backorders from the fourth quarter," commented Teerlink.  "We still expect
1997 to be a rebuilding year for our General Merchandise business and do not
expect additional growth.  We recently hired a new vice president of General
Merchandise, who brings 20+ years of experience and proven leadership in the
apparel and retail environment to Harley-Davidson."

    Buell
    Buell Distribution Corporation, a wholly-owned subsidiary of
Harley-Davidson, Inc., and the exclusive distributor of Buell Motorcycle
Company (a 49 percent owned subsidiary), reported first quarter sales of 1,087
units or $9.6 million, versus 522 units or $4.5 million in the year-ago
quarter.  "We started selling Buell motorcycles in Europe and shipped 314
units during the first quarter," Teerlink said.  "The response from the Buell
dealers, motorcycle press, and riding public has been positive."

    Eaglemark Financial Services
    Eaglemark Financial Services, Inc. (Eaglemark), a subsidiary of
Harley-Davidson, Inc., reported first quarter operating income of $2.2 million
versus $1.7 million in the year-ago quarter, a 28.1 percent increase.
"Eaglemark continues to grow," said Teerlink.  "They increased their market
share of retail installment lending on Harley-Davidson motorcycles to 19
percent, from 16 percent last year."

    Harley-Davidson Motor Company, the only major U.S.-based motorcycle
manufacturer, produces heavyweight motorcycles and a complete line of
motorcycle parts, accessories, apparel, and general merchandise.  Eaglemark
Financial Services, Inc. provides wholesale and retail financing, insurance
and credit card programs to Harley-Davidson dealers and customers and similar
programs for other leisure products manufacturers.


                            Harley-Davidson, Inc.
                 Condensed Consolidated Statements of Income
                   (In thousands, except per share amounts)

                                                        Three Months Ended
                                                      Mar. 30,       Mar. 31,
                                                       1997            1996

    Net sales                                        $427,095        $371,051
    Operating income                                   62,648          54,025
    Interest income/(expense)                           1,574            (405)
    Other income/(expense)                               (185)         (1,249)
    Income before provision for taxes                  64,037          52,371
    Provision for income taxes                         23,695          19,377
    Net income                                       $ 40,342        $ 32,994
    Earnings per share                                   $.53            $.44
    Shares outstanding                                 75,699          75,113




                                                            Segment Data
                                                          Three Months Ended
                                                      Mar. 30,        Mar. 31,
                                                        1997            1996
    HARLEY-DAVIDSON UNITS
    Motorcycle shipments:
      United States                                    22,582          21,043
      Export                                           10,278           9,028
        Total                                          32,860          30,071

    BUELL UNITS
    Motorcycle shipments                                1,087             522

    OPERATING INCOME (Thousands)
    Motorcycles and Related Products                  $63,016         $54,770
    Financial Services                                  2,219           1,732
    Corporate expenses                                 (2,587)         (2,477)
        Total                                         $62,648         $54,025


                            Harley-Davidson, Inc.
                     Condensed Consolidated Balance Sheets
                                (In thousands)

                                                     Mar. 30,      Mar. 31,
                                                       1997          1996

    Assets
      Current assets:
        Cash and cash equivalents                    $  110,637    $   39,577
        Accounts receivable                             215,032       157,786
        Inventories                                      93,440        85,758
        Other current assets                             40,631        41,128
        Net assets from discontinued operations               0        22,833
          Total current assets                          459,740       347,082
        Finance subsidiary receivables, net             418,119       270,762
        Other long-term assets                          559,200       418,090
        Net assets from discontinued operations               0        26,981
          Total assets                               $1,437,059    $1,062,915
    Liabilities and stockholders' equity
      Current liabilities:
        Notes payable and current maturities         $    1,029    $    1,298
        Other current liabilities                       270,641       216,667
          Total current liabilities                     271,670       217,965
      Finance subsidiary debt                           335,740       196,657
      Other long-term liabilities                        67,327        50,746
      Postretirement health care benefits                66,635        63,980
      Total stockholders' equity                        695,687       533,567
        Total liabilities and
         stockholders' equity                        $1,437,059    $1,062,915

SOURCE  Harley-Davidson, Inc.