Harley-Davidson to Expand Dealer Network in Brazil

Harley-Davidson Inc. said it will expand its dealer network in Brazil, as the biggest U.S. motorcycle maker seeks international growth while sales in its home market slow.

The company reached an agreement with HDSP/Grupo Izzo, its exclusive dealer in Brazil, that will allow Harley to appoint new retailers in the future, according to a statement today that didn’t provide details. Costs of the planned expansion will reduce profit this quarter by as much as 6 cents a share, Milwaukee-based Harley said in a regulatory filing.

Harley’s motorcycle sales in the U.S., its largest market, dropped 37 percent to $2.91 billion last year from 2006, hurt by the recession. The company, which had total motorcycle sales of $4.29 billion in 2009, doesn’t report a breakdown of revenue from Brazil or the Latin America region.

HDSP/Grupo Izzo operates nine retail outlets in Brazil, Bob Klein, a Harley spokesman, said in an e-mail.

Harley said it recently opened an office in Sao Paulo. The company has a factory in Manaus, Brazil, where since 1999 it has assembled motorcycles for the sale in that country. Harley has sold heavyweight bikes in Brazil since 1993.

Harley rose 98 cents, or 3.1 percent, to $32.26 at 4:15 p.m. in New York Stock Exchange composite trading. The shares have gained 28 percent this year.

To contact the reporter on this story: Mark Clothier in Southfield, Michigan, at mclothier@bloomberg.net

To contact the editor responsible for this story: Jamie Butters at jbutters@bloomberg.net

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