October 17, 2017 Conference Call Slide Presentation HARLEY-DAVIDSON, INC THIRD QUARTER UPDATE

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1 HARLEY-DAVIDSON, INC THIRD QUARTER UPDATE OCTOBER 17, 2017

2 2017 THIRD QUARTER UPDATE THIS PRESENTATION SUPPORTS THE AUDIO CONFERENCE CALL CONFERENCE CALL AGENDA Introduction Business Perspectives Financial Results Q&A Amy Giuffre, Director, Investor Relations Matt Levatich, President and CEO John Olin, Senior Vice President and CFO All This presentation includes forward-looking statements that are subject to risks that could cause actual results to be materially different. Those risks include, among others, matters we have noted in our latest earnings presentation and filings with the SEC. Harley-Davidson disclaims any obligation to update information in this presentation. Additional information and risk factors are included at the end of this presentation. 2

3 2017 THIRD QUARTER BUSINESS PERSPECTIVES MATT LEVATICH, PRESIDENT & CEO, HARLEY-DAVIDSON, INC.

4 Q3 SNAPSHOT U.S. motorcycle industry declined in the quarter, weakness expected to continue Harley-Davidson retail sales down Managed supply in line with demand Aggressively managed business cost structure Invested in our long-term strategy 4

5 DELIVERING HIGH-IMPACT MOTORCYCLES Eight new Softail models feature an improved, significantly lighter frame built to harness the new dual-counterbalanced Milwaukee-Eight 107 and 114 engines Fat Boy Fat Bob 5

6 WHAT THE MEDIA SAID 150M+ Impressions The company says the machines are lighter and more powerful, and handle better, than the models they replace. I ve ridden two of them, and I agree. Los Angeles Times For those who have been asking how H-D hopes to stay relevant as its core customer base gets too old to ride, here s its answer. Lanesplitter La Fat Bob ainsi modifiée vient marcher sur les platebandes des gros roadsters - et remplacer feu la V-Rod de la marque américaine - dans un style tonitruant qui lui est propre. MotoMag.com New technology with trademark heritage style has long been Harley's recipe for success, and the 2018 Softail family looks like a great new dish from that cookbook. Maxim 6

7 DELIVERING HIGH-IMPACT MOTORCYCLES 14 new high-impact motorcycles for model year 2018 CVO LIMITED Street Glide Special 7

8 BUILDING 2 MILLION RIDERS IN U.S. More than 19,000 riders were trained through Harley- Davidson Riding Academy in the quarter Harley-Davidson and EagleRider forged exclusive U.S. alliance to deliver premium motorcycle rental experiences 8

9 GROWING INTERNATIONAL REACH 15 new dealerships in nine countries opened in the quarter Ingolstadt, Germany Hatyai, Thailand 9

10 FULL THROTTLE ON OUR STRATEGY 10

11 2017 THIRD QUARTER FINANCIAL RESULTS JOHN OLIN, SENIOR VICE PRESIDENT & CFO, HARLEY-DAVIDSON, INC.

12 Consolidated Motorcycles and Related Products and Financial Services Segments Q VS. Q RESULTS REVENUE NET INCOME EPS $1.15 $68.2 $0.40 Billion Million (9.7)% (40.2)% (37.5)% Earnings impacted by: Motorcycles Segment operating income down $89.3 million Revenue down 11.9% on 14.3% lower shipments Gross margin percent of 28.8%, down 4.8 pts. Slightly lower yr./yr. SG&A Operating margin of 2.0%, down 8.0 pts. Financial Services segment operating income up 11.0% Lower effective tax rate YTD cash from operations up despite lower net income 12

13 Motorcycles and Related Products Segment WORLDWIDE RETAIL SALES vs. Prior Year Q3 Motorcycles Q3 YTD Worldwide 64,209 (6.9)% (6.1)% U.S. 41,793 (8.1)% (8.0)% International 22,416 (4.6)% (2.9)% Source: Dealer reported data U.S. new retail sales down in Q3 Industry new motorcycle sales weakness for eighth consecutive quarter Aggressive supply management delivering intended results International new retail sales remained soft Declines in Japan, Australia and Mexico Growth across most other markets Positive response to MY 2018 motorcycles Maintaining shipment guidance 13

INVENTORY Motorcycles and Related Products Segment RETAIL SALES Motorcycles (thousands) SHARE U.S. RETAIL SALES H-D U.S. NEW RETAIL MOTORCYCLE SALES 135.6 124.8 (4.7)% (8.0)% H-D U.S. NEW 601+CC RETAIL MARKET SHARE* 52.

1)% Q3 '16 Q3 '17 YTD '16 YTD '17 Q3 retail sales impacted by: Weak industry Soft used bike prices Hurricanes in Texas and the Southeast Market Share gains + Strong demand for Cruisers + EagleRider

14 INVENTORY Motorcycles and Related Products Segment RETAIL SALES Motorcycles (thousands) SHARE U.S. RETAIL SALES H-D U.S. NEW RETAIL MOTORCYCLE SALES (4.7)% (8.0)% H-D U.S. NEW 601+CC RETAIL MARKET SHARE* 52.3% 53.1% 50.8% 50.7% (0.1) pts pts pts. (0.1) pts (7.1)% (8.1)% Q3 '16 Q3 '17 YTD '16 YTD '17 Q3 retail sales impacted by: Weak industry Soft used bike prices Hurricanes in Texas and the Southeast Market Share gains + Strong demand for Cruisers + EagleRider initial fleet of new H-D rental bikes Significantly constrained availability YTD used H-D bike sales* & Q3 pricing up vs. prior year * YTD through Aug. Q3 '16 Q3 '17 YTD '16 YTD '17 Q3 market share up despite significantly constrained availability H-D U.S. NEW RETAIL MOTORCYCLE INVENTORY Dealer inventory down approximately 12,200 motorcycles vs. prior year Committed to aggressively manage supply in line with demand. Expect year-end U.S. retail inventory will be down significantly compared to year-end 2016 * Source: Motorcycle Industry Council 14

15 RETAIL SALES INTERNATIONAL RETAIL SALES vs. Prior Year H-D EUROPE 601+CC MARKET SHARE* 10.2% 9.6% Motorcycles and Related Products Segment H-D INTERNATIONAL NEW RETAIL MOTORCYCLE SALES Q3 YTD International (4.6)% (2.9)% OPPORTUNITY SHARE - EMEA (1.4)% (1.2)% Healthy demand for new models and growth in Europe; Middle-East and Africa down - Asia Pacific (6.7)% (6.3)% Japan and Australia down; emerging markets up - Latin America (11.5)% (0.9)% Mexico down, Brazil up - Canada (3.3)% (2.0)% YTD '16 YTD '17 Q3 share of 9.8% was up 0.3 pts. YTD share down in a highly competitive environment INTERNATIONAL GROWTH Objective: Grow international business to 50% of annual volume by 2027 Strategy: Grow reach and impact - Expand dealer network - Plan to add 150 to 200 new dealerships between 2016 through opened in Q3, 35 YTD - Target competitive riders - Expand H-D Touring - Build brand awareness through apparel * Source: Association des Constructeurs Europeens de Motocycles (ACEM) 15

16 Motorcycles and Related Products Segment SHIPMENTS & MIX SHIPMENTS MOTORCYCLES SEGMENT Q3 vs. PY YTD vs. PY Total 41,662 (14.3)% 194,300 (11.6)% Touring 35.2% (12.7) pts. 41.4% 0.7 pts. Cruiser* 41.5% 12.7 pts. 34.8% (0.9)pts. Street / Sportster 23.3% 100.0% - pts. 23.8% 100.0% 0.2 pts. * YTD Includes Dyna, Softail, V-Rod and CVO platforms Q3 shipments down 6,949 motorcycles yr./yr. as we aggressively managed supply in line with demand Within guidance range of 39,000 to 44,000 motorcycles 52.8% of motorcycle shipments were international Q3 mix skewed to Cruisers reflecting MY 2018 allnew Softail motorcycles 16

17 Motorcycles and Related Products Segment REVENUE REVENUE MOTORCYCLES SEGMENT ($ millions) Q3 vs. PY YTD vs. PY Motorcycle $ (17.2)% $3,023.5 (12.0)% P&A (0.7) (5.5) General Merchandise (9.5) Other Total Revenue $962.1 (11.9)% $3,868.0 (10.8)% Motorcycles Segment revenue down 11.9% in Q3 behind a 14.3% decrease in motorcycle shipments Average motorcycle revenue per unit yr./yr. decreased $546 in Q3 behind unfavorable mix, partially offset by higher pricing and favorable currency MY 2018 weighted average pricing up approximately 3%; net of new content costs up approximately 1 pt. as a percent of revenue 17

18 Motorcycles and Related Products Segment GROSS MARGIN GROSS MARGIN MOTORCYCLES SEGMENT ($ millions) Q3 YTD 2016 Gross Margin $367.0 $1,564.8 % of revenue 33.6% 36.1% - Volume (49.6) (201.5) - Pricing net of cost Mix (26.7) (25.9) - Currency Raw materials (3.0) (12.8) - Manufacturing / other (21.7) (35.9) 2017 Gross Margin $277.0 $1,330.1 % of revenue 28.8% 34.4% Q3 Motorcycles segment gross margin % of revenue impacted by: - Mix unfavorable motorcycle family mix - Currency favorable due to weaker U.S. dollar - Raw materials higher steel and aluminum costs - Manufacturing expense up on lower fixed cost absorption and higher start-up costs 18

19 Motorcycles and Related Products Segment OPERATING MARGIN OPERATING MARGIN MOTORCYCLES SEGMENT ($ millions) Q3 YTD 2016 Operating Income $108.9 $764.1 % of revenue 10.0% 17.6% - Gross Margin (90.0) (234.8) - SG&A Operating Income $19.6 $578.1 % of revenue 2.0% 14.9% Q3 Motorcycles segment operating margin was down 8.0 pts. compared to prior year - Q3 SG&A reflected higher marketing and product development investment, offset by aggressive cost management in other areas 19

20 Financial Services Segment HDFS OPERATING INCOME FINANCIAL SERVICES SEGMENT ($ millions) Q3 YTD 2016 Operating Income $69.5 $ Net interest income Gain on full securitization (Q2 2016) - (9.3) - Provision for retail motorcycle loan losses 7.3 (0.6) - Provision for wholesale loan losses 0.1 (0.5) - Operating expenses (2.0) (2.2) - All other Operating Income $77.1 $211.6 Financial Services Q3 operating income was higher due to a lower provision for retail loan losses 20 20

21 Financial Services Segment HDFS 2017 FINANCIAL SERVICES SEGMENT OPERATIONS Originations New and used H-D retail motorcycle loans Q3 $817.5M (7.5)% vs. Q3 16 YTD $2,515.0M (3.3)% vs. YTD 16 YTD approximately 80% prime Market share U.S. H-D new retail motorcycle sales financed Q3 58.6% (5.7) pts. vs. Q3 16 YTD 61.4% (0.7) pts. vs. YTD 16 Finance receivables outstanding End of Quarter Retail $6.34B Wholesale 0.96B Total $7.30B (0.3)% vs. Q3 16 LIQUIDITY (Millions) End of Quarter Cash & equivalents $ Availability Bank Credit Facilities $ Asset-Backed Conduits Total Availability $ 1,324.8 Other HDFS paid H-D, Inc. a dividend of $90 million in Q

22 Financial Services Segment HDFS RETAIL MOTORCYCLE LOAN PERFORMANCE 5% 4% 3% 4.83% 3.73% 3.24% 30+ Day Delinquencies 3.11% 3.00% 3.16% 3.61% 3.72% 3.65% 3.49% Q day delinquency 3.72% on-balance sheet receivables 3.65% on a managed basis (Including receivables sold in the Q2 16 full securitization) 2% Q3 '10 Q3 '11 Q3 '12 Q3 '13 Q3 '14 Q3 '15 Q3 '16 Q3 '17 3% 2% 1% 2.04% 1.11% 0.65% Annualized Loss Experience 1.19% 1.08% 0.88% 1.59% 1.57% 1.73% 1.69% Q Annual loss rate 1.73% on-balance sheet receivables 1.69% on a managed basis (Including receivables sold in the Q2 16 full securitization) 0% Q3 '10 Q3 '11 Q3 '12 Q3 '13 Q3 '14 Q3 '15 Q3 '16 Q3 '

23 Consolidated Motorcycles and Related Products and Financial Services Segments HARLEY-DAVIDSON, INC HARLEY-DAVIDSON, INC. VS. PY Cash & marketable securities $683.1 million vs. $795.3 million (Q3 quarter end) Operating cash flow - $949.1 million vs. $927.8 million (YTD) Capital spending - $114.0 million vs. $162.7 million (YTD) Depreciation/amortization expense - $164.0 million vs. $154.6 million (YTD) Tax rate 33.2% vs. 32.9% (YTD) 23

Multi-Year Millions Year-over-year Millions SHAREHOLDER RETURNS Harley-Davidson has consistently returned

40 $0.20 $0.35 $0.365 $1.05 $1.095 $500.0 $400.0 $300.0 $200.0 $100.0 $104.6 $222.0 $368.1 $456.1 $0.

24 Multi-Year Millions Year-over-year Millions SHAREHOLDER RETURNS Harley-Davidson has consistently returned cash to our shareholders Dividends Per Share Discretionary Share Repurchases $1.20 $1.00 $0.80 $0.60 $0.40 $0.20 $0.35 $0.365 $1.05 $1.095 $500.0 $400.0 $300.0 $200.0 $100.0 $104.6 $222.0 $368.1 $456.1 $0.00 Q YTD $0.0 Q YTD $1.40 $1.20 $1.00 $0.80 $0.60 $0.40 $0.20 $0.00 CAGR 24% $1.40 $1.24 $1.10 $0.84 $0.62 $ $2,000 $1,800 $1,600 $1,400 $1,200 $1,000 $800 $600 $400 $200 $0 $1,526* $456 $604 $459 $218 $ * Funded by $750 million HDI debt issuance 24

25 GUIDANCE 2017 EXPECTATIONS as of October 17, 2017 Motorcycles and Related Products segment Financial Services segment Motorcycle shipments Gross margin % SG&A Operating margin % HDFS operating income 241,000 to 246,000 Q4: 46,700 to 51,700 Down yr./yr. Down yr./yr. Flat as a percent of revenue Down approx. 1 pt. yr./yr. Down yr./yr. Harley-Davidson, Inc. Capital expenditures $200 million - $220 million Effective tax rate Approximately 33.4% 25

26 HARLEY-DAVIDSON, INC. Disciplined to our strategies Focused investments, strong returns to sustain the company for the long-term 26

27 FORWARD-LOOKING STATEMENTS The company intends that certain matters discussed in this presentation are "forward-looking statements" intended to qualify for the safe harbor from liability established by the Private Securities Litigation Reform Act of These forward-looking statements can generally be identified as such 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, unfavorably or favorably, from those anticipated as of the date of this presentation. Certain of such risks and uncertainties are described below. 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 this presentation are only made as of the date of this presentation, and the company disclaims any obligation to publicly update such forward-looking statements to reflect subsequent events or circumstances. 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) drive demand by executing its marketing strategy of appealing to and growing sales to multigenerational and multi-cultural customers worldwide in an increasingly competitive marketplace, (iii) develop and introduce products, services and experiences that are successful in the marketplace, (iv) manage the impact that prices for and supply of used motorcycles may have on its business, including on retail sales of new motorcycles, (v) 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, (vi) manage through changes in general economic and business conditions, including changing capital, credit and retail markets, and the changing political environment, (vii) manage risks that arise through expanding international manufacturing, operations and sales, (viii) accurately estimate and adjust to fluctuations in foreign currency exchange rates, interest rates and commodity prices, (ix) manage the credit quality, the loan servicing and collection activities, and the recovery rates of HDFS' loan portfolio, (x) prevent and detect any issues with its motorcycles or any associated manufacturing processes to avoid delays in new model launches, recall campaigns, regulatory agency investigations, increased warranty costs or litigation and adverse effects on its reputation and brand strength, (xi) retain and attract talented employees, cont. 27

28 FORWARD-LOOKING STATEMENTS (xii) prevent a cybersecurity breach involving consumer, employee, dealer, supplier, or company data and respond to evolving regulatory requirements regarding data security, (xiii) continue to develop the capabilities of its distributors and dealers and manage the risks that its independent dealers may have difficulty obtaining capital and managing through changing economic conditions and consumer demand, (xiv) adjust to tax reform, healthcare inflation and reform and pension reform, (xv) manage through the effects inconsistent and unpredictable weather patterns may have on retail sales of motorcycles, (xvi) manage supply chain issues, including quality issues and any unexpected interruptions or price increases caused by raw material shortages or natural disasters, (xvii) implement and manage enterprise-wide information technology systems, including systems at its manufacturing facilities, (xviii) manage changes and prepare for requirements in legislative and regulatory environments for its products, services and operations, (xix) manage its exposure to product liability claims and commercial or contractual disputes, (xx) execute its flexible production strategy, (xxi) successfully access the capital and/or credit markets on terms (including interest rates) that are acceptable to the company and within its expectations, and (xxii) continue to manage the relationships and agreements that the company has with its labor unions to help drive long-term competitiveness. 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. Other factors are described in risk factors that the company has disclosed in documents previously filed with the Securities and Exchange Commission. 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. 28

Harley-Davidson, Inc Second Quarter Update July 21, 2015

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