Supplemental Consolidating Data (Tables)

9 Months Ended

Sep. 30, 2012

Operations

	Three months ended September 30, 2012
	Motorcycles & Related Products Operations		Financial Services Operations		Eliminations			Consolidated
Revenue:
Motorcycles and related products	$	1,091,887	$	—	$	(2,619	)	$	1,089,268
Financial services	—		161,438		(411		)	161,027
Total revenue	1,091,887		161,438		(3,030		)	1,250,295
Costs and expenses:
Motorcycles and related products cost of goods sold	711,364		—		—			711,364
Financial services interest expense	—		46,231		—			46,231
Financial services provision for credit losses	—		9,069		—			9,069
Selling, administrative and engineering expense	224,393		35,996		(3,030		)	257,359
Restructuring expense	9,170		—		—			9,170
Total costs and expenses	944,927		91,296		(3,030		)	1,033,193
Operating income	146,960		70,142		—			217,102
Investment income	1,447		—		—			1,447
Interest expense	11,438		—		—			11,438
Income before provision for income taxes	136,969		70,142		—			207,111
Provision for income taxes	47,859		25,251		—			73,110
Income from continuing operations	89,110		44,891		—			134,001
Income from discontinued operations, net of tax	—		—		—			—
Net income	$	89,110	$	44,891	$	—		$	134,001
	Nine months ended September 30, 2012
	Motorcycles & Related Products Operations		Financial Services Operations		Eliminations			Consolidated
Revenue:
Motorcycles and related products	$	3,939,673	$	—	$	(7,989	)	$	3,931,684
Financial services	—		478,187		(225		)	477,962
Total revenue	3,939,673		478,187		(8,214		)	4,409,646
Costs and expenses:
Motorcycles and related products cost of goods sold	2,533,453		—		—			2,533,453
Financial services interest expense	—		146,199		—			146,199
Financial services provision for credit losses	—		12,823		—			12,823
Selling, administrative and engineering expense	709,240		105,231		(8,214		)	806,257
Restructuring expense	26,841		—		—			26,841
Total costs and expenses	3,269,534		264,253		(8,214		)	3,525,573
Operating income	670,139		213,934		—			884,073
Investment income	230,611		—		(225,000		)	5,611
Interest expense	34,528		—		—			34,528
Income before provision for income taxes	866,222		213,934		(225,000		)	855,156
Provision for income taxes	224,854		77,016		—			301,870
Income from continuing operations	641,368		136,918		(225,000		)	553,286
Income from discontinued operations, net of tax	—		—		—			—
Net income	$	641,368	$	136,918	$	(225,000	)	$	553,286

	Three months ended September 25, 2011
	Motorcycles & Related Products Operations		Financial Services Operations		Eliminations			Consolidated
Revenue:
Motorcycles and related products	$	1,234,913	$	—	$	(2,214	)	$	1,232,699
Financial services	—		165,512		(955		)	164,557
Total revenue	1,234,913		165,512		(3,169		)	1,397,256
Costs and expenses:
Motorcycles and related products cost of goods sold	817,308		—		—			817,308
Financial services interest expense	—		61,907		—			61,907
Financial services provision for credit losses	—		6,189		—			6,189
Selling, administrative and engineering expense	223,213		36,691		(3,169		)	256,735
Restructuring expense	12,429		—		—			12,429
Total costs and expenses	1,052,950		104,787		(3,169		)	1,154,568
Operating income	181,963		60,725		—			242,688
Investment income	2,479		—		—			2,479
Interest expense	11,270		—		—			11,270
Income before provision for income taxes	173,172		60,725		—			233,897
Provision for income taxes	27,906		22,397		—			50,303
Income from continuing operations	145,266		38,328		—			183,594
Loss from discontinued operations, net of tax	—		—		—			—
Net income	$	145,266	$	38,328	$	—		$	183,594
	Nine months ended September 25, 2011
	Motorcycles & Related Products Operations		Financial Services Operations		Eliminations			Consolidated
Revenue:
Motorcycles and related products	$	3,643,206	$	—	$	(7,719	)	$	3,635,487
Financial services	—		493,782		(1,486		)	492,296
Total revenue	3,643,206		493,782		(9,205		)	4,127,783
Costs and expenses:
Motorcycles and related products cost of goods sold	2,399,962		—		—			2,399,962
Financial services interest expense	—		176,933		—			176,933
Financial services provision for credit losses	—		5,005		—			5,005
Selling, administrative and engineering expense	662,376		106,103		(9,205		)	759,274
Restructuring expense	49,022		—		—			49,022
Total costs and expenses	3,111,360		288,041		(9,205		)	3,390,196
Operating income	531,846		205,741		—			737,587
Investment income	130,625		—		(125,000		)	5,625
Interest expense	34,101		—		—			34,101
Income before provision for income taxes	628,370		205,741		(125,000		)	709,111
Provision for income taxes	141,074		74,603		—			215,677
Income from continuing operations	487,296		131,138		(125,000		)	493,434
Loss from discontinued operations, net of tax	—		—		—			—
Net income	$	487,296	$	131,138	$	(125,000	)	$	493,434

	September 30, 2012
	Motorcycles & Related Products Operations		Financial Services Operations		Eliminations			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	1,048,429	$	746,712	$	—		$	1,795,141
Marketable securities	136,376		—		—			136,376
Accounts receivable, net	623,021		—		(366,828		)	256,193
Finance receivables, net	—		1,212,977		—			1,212,977
Restricted finance receivables held by variable interest entities, net	—		513,084		—			513,084
Inventories	379,129		—		—			379,129
Restricted cash held by variable interest entities	—		217,400		—			217,400
Other current assets	177,278		60,118		—			237,396
Total current assets	2,364,233		2,750,291		(366,828		)	4,747,696
Finance receivables, net	—		2,285,309		—			2,285,309
Restricted finance receivables held by variable interest entities, net	—		1,904,297		—			1,904,297
Property, plant and equipment, net	735,719		29,116		—			764,835
Goodwill	28,928		—		—			28,928
Other long-term assets	338,987		20,193		(75,062		)	284,118
	$	3,467,867	$	6,989,206	$	(441,890	)	$	10,015,183
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	251,755	$	408,783	$	(366,828	)	$	293,710
Accrued liabilities	521,867		87,936		(3,725		)	606,078
Short-term debt	—		404,693		—			404,693
Current portion of long-term debt	—		437,938		—			437,938
Current portion of long-term debt held by variable interest entities	—		559,256		—			559,256
Total current liabilities	773,622		1,898,606		(370,553		)	2,301,675
Long-term debt	303,000		3,036,604		—			3,339,604
Long-term debt held by variable interest entities	—		1,132,809		—			1,132,809
Pension liability	125,664		—		—			125,664
Postretirement healthcare benefits	261,564		—		—			261,564
Other long-term liabilities	134,509		15,995		—			150,504
Commitments and contingencies (Note 17)
Total shareholders’ equity	1,869,508		905,192		(71,337		)	2,703,363
	$	3,467,867	$	6,989,206	$	(441,890	)	$	10,015,183

Balance Sheet

	September 30, 2012
	Motorcycles & Related Products Operations		Financial Services Operations		Eliminations			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	1,048,429	$	746,712	$	—		$	1,795,141
Marketable securities	136,376		—		—			136,376
Accounts receivable, net	623,021		—		(366,828		)	256,193
Finance receivables, net	—		1,212,977		—			1,212,977
Restricted finance receivables held by variable interest entities, net	—		513,084		—			513,084
Inventories	379,129		—		—			379,129
Restricted cash held by variable interest entities	—		217,400		—			217,400
Other current assets	177,278		60,118		—			237,396
Total current assets	2,364,233		2,750,291		(366,828		)	4,747,696
Finance receivables, net	—		2,285,309		—			2,285,309
Restricted finance receivables held by variable interest entities, net	—		1,904,297		—			1,904,297
Property, plant and equipment, net	735,719		29,116		—			764,835
Goodwill	28,928		—		—			28,928
Other long-term assets	338,987		20,193		(75,062		)	284,118
	$	3,467,867	$	6,989,206	$	(441,890	)	$	10,015,183
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	251,755	$	408,783	$	(366,828	)	$	293,710
Accrued liabilities	521,867		87,936		(3,725		)	606,078
Short-term debt	—		404,693		—			404,693
Current portion of long-term debt	—		437,938		—			437,938
Current portion of long-term debt held by variable interest entities	—		559,256		—			559,256
Total current liabilities	773,622		1,898,606		(370,553		)	2,301,675
Long-term debt	303,000		3,036,604		—			3,339,604
Long-term debt held by variable interest entities	—		1,132,809		—			1,132,809
Pension liability	125,664		—		—			125,664
Postretirement healthcare benefits	261,564		—		—			261,564
Other long-term liabilities	134,509		15,995		—			150,504
Commitments and contingencies (Note 17)
Total shareholders’ equity	1,869,508		905,192		(71,337		)	2,703,363
	$	3,467,867	$	6,989,206	$	(441,890	)	$	10,015,183

	December 31, 2011
	Motorcycles & Related Products Operations		Financial Services Operations		Eliminations			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	943,330	$	583,620	$	—		$	1,526,950
Marketable securities	153,380		—		—			153,380
Accounts receivable, net	393,615		—		(174,576		)	219,039
Finance receivables, net	—		1,168,603		—			1,168,603
Restricted finance receivables held by variable interest entities, net	—		591,864		—			591,864
Inventories	418,006		—		—			418,006
Restricted cash held by variable interest entities	—		229,655		—			229,655
Other current assets	167,423		67,286		—			234,709
Total current assets	2,075,754		2,641,028		(174,576		)	4,542,206
Finance receivables, net	—		1,754,441		—			1,754,441
Restricted finance receivables held by variable interest entities, net	—		2,271,773		—			2,271,773
Property, plant and equipment, net	779,330		30,129		—			809,459
Goodwill	29,081		—		—			29,081
Other long-term assets	322,379		17,460		(72,635		)	267,204
	$	3,206,544	$	6,714,831	$	(247,211	)	$	9,674,164
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	220,957	$	209,332	$	(174,576	)	$	255,713
Accrued liabilities	482,838		85,038		(3,704		)	564,172
Short-term debt	—		838,486		—			838,486
Current portion of long-term debt	—		399,916					399,916
Current portion of long-term debt held by variable interest entities	—		640,331		—			640,331
Total current liabilities	703,795		2,173,103		(178,280		)	2,698,618
Long-term debt	303,000		2,093,871		—			2,396,871
Long-term debt held by variable interest entities	—		1,447,015		—			1,447,015
Pension liability	302,483		—		—			302,483
Postretirement healthcare benefits	268,582		—		—			268,582
Other long-term liabilities	126,036		14,303		—			140,339
Commitments and contingencies (Note 17)
Total shareholders’ equity	1,502,648		986,539		(68,931		)	2,420,256
	$	3,206,544	$	6,714,831	$	(247,211	)	$	9,674,164

	September 25, 2011
	Motorcycles & Related Products Operations		Financial Services Operations		Eliminations			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	995,855	$	432,898	$	—		$	1,428,753
Marketable securities	179,285		—		—			179,285
Accounts receivable, net	590,611		—		(305,279		)	285,332
Finance receivables, net	—		1,104,056		—			1,104,056
Restricted finance receivables held by variable interest entities, net	—		586,144		—			586,144
Inventories	345,963		—		—			345,963
Restricted cash held by variable interest entities	—		238,208		—			238,208
Other current assets	159,814		57,631		—			217,445
Total current assets	2,271,528		2,418,937		(305,279		)	4,385,186
Finance receivables, net	—		2,095,839		—			2,095,839
Restricted finance receivables held by variable interest entities, net	—		2,119,789		—			2,119,789
Property, plant and equipment, net	746,230		28,983		—			775,213
Goodwill	30,004		—		—			30,004
Other long-term assets	344,073		25,874		(71,619		)	298,328
	$	3,391,835	$	6,689,422	$	(376,898	)	$	9,704,359
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	246,210	$	348,559	$	(305,279	)	$	289,490
Accrued liabilities	627,972		107,414		(3,443		)	731,943
Short-term debt	—		774,971		—			774,971
Current portion of long-term debt held by variable interest entities	—		644,779		—			644,779
Total current liabilities	874,182		1,875,723		(308,722		)	2,441,183
Long-term debt	303,000		2,501,605		—			2,804,605
Long-term debt held by variable interest entities	—		1,350,294		—			1,350,294
Pension liability	106,795		—		—			106,795
Postretirement healthcare liability	262,096		—		—			262,096
Other long-term liabilities	124,031		14,095		—			138,126
Commitments and contingencies (Note 17)
Total shareholders’ equity	1,721,731		947,705		(68,176		)	2,601,260
	$	3,391,835	$	6,689,422	$	(376,898	)	$	9,704,359

Cash Flows

	September 25, 2011
	Motorcycles & Related Products Operations		Financial Services Operations		Eliminations			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	995,855	$	432,898	$	—		$	1,428,753
Marketable securities	179,285		—		—			179,285
Accounts receivable, net	590,611		—		(305,279		)	285,332
Finance receivables, net	—		1,104,056		—			1,104,056
Restricted finance receivables held by variable interest entities, net	—		586,144		—			586,144
Inventories	345,963		—		—			345,963
Restricted cash held by variable interest entities	—		238,208		—			238,208
Other current assets	159,814		57,631		—			217,445
Total current assets	2,271,528		2,418,937		(305,279		)	4,385,186
Finance receivables, net	—		2,095,839		—			2,095,839
Restricted finance receivables held by variable interest entities, net	—		2,119,789		—			2,119,789
Property, plant and equipment, net	746,230		28,983		—			775,213
Goodwill	30,004		—		—			30,004
Other long-term assets	344,073		25,874		(71,619		)	298,328
	$	3,391,835	$	6,689,422	$	(376,898	)	$	9,704,359
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	246,210	$	348,559	$	(305,279	)	$	289,490
Accrued liabilities	627,972		107,414		(3,443		)	731,943
Short-term debt	—		774,971		—			774,971
Current portion of long-term debt held by variable interest entities	—		644,779		—			644,779
Total current liabilities	874,182		1,875,723		(308,722		)	2,441,183
Long-term debt	303,000		2,501,605		—			2,804,605
Long-term debt held by variable interest entities	—		1,350,294		—			1,350,294
Pension liability	106,795		—		—			106,795
Postretirement healthcare liability	262,096		—		—			262,096
Other long-term liabilities	124,031		14,095		—			138,126
Commitments and contingencies (Note 17)
Total shareholders’ equity	1,721,731		947,705		(68,176		)	2,601,260
	$	3,391,835	$	6,689,422	$	(376,898	)	$	9,704,359

	Nine months ended September 30, 2012
	Motorcycles & Related Products Operations			Financial Services Operations		Eliminations & Adjustments			Consolidated
Cash flows from operating activities:
Income from continuing operations	$	641,368		136,918		$	(225,000	)	$	553,286
Adjustments to reconcile income from continuing operations to cash provided by operating activities:
Depreciation	122,570			4,873		—			127,443
Amortization of deferred loan origination costs	—			58,438		—			58,438
Amortization of financing origination fees	355			7,107		—			7,462
Provision for employee long-term benefits	48,808			1,540		—			50,348
Contributions to pension and postretirement plans	(220,733		)	—		—			(220,733		)
Stock compensation expense	27,881			2,406		—			30,287
Net change in wholesale finance receivables	—			—		5,570			5,570
Provision for credit losses	—			12,823		—			12,823
Pension and postretirement healthcare plan curtailment and settlement expense	—			—		—			—
Foreign currency adjustments	8,692			—		—			8,692
Other, net	2,252			7,159		—			9,411
Change in current assets and current liabilities:
Accounts receivable	(230,156		)	—		192,252			(37,904		)
Finance receivables—accrued interest and other	—			1,597		—			1,597
Inventories	36,463			—		—			36,463
Accounts payable and accrued liabilities	86,513			205,381		(192,252		)	99,642
Restructuring reserves	(9,177		)	—		—			(9,177		)
Derivative instruments	739			(128	)	—			611
Other	(19,550		)	(2,211	)	—			(21,761		)
Total adjustments	(145,343		)	298,985		5,570			159,212
Net cash provided by operating activities of continuing operations	496,025			435,903		(219,430		)	712,498

	Nine months ended September 30, 2012
	Motorcycles & Related Products Operations			Financial Services Operations			Eliminations & Adjustments			Consolidated
Cash flows from investing activities of continuing operations:
Capital expenditures	(91,469		)	(3,860		)	—			(95,329		)
Origination of finance receivables	—			(5,315,732		)	2,987,079			(2,328,653		)
Collections of finance receivables	—			5,123,674			(2,992,649		)	2,131,025
Purchases of marketable securities	(4,993		)	—			—			(4,993		)
Sales and redemptions of marketable securities	23,046			—			—			23,046
Net cash (used by) provided by investing activities of continuing operations	(73,416		)	(195,918		)	(5,570		)	(274,904		)
Cash flows from financing activities of continuing operations:
Proceeds from issuance of medium-term notes	—			993,737			—			993,737
Loan to HDFS	—			—			—			—
Proceeds from securitization of debt	—			763,895			—			763,895
Repayments of securitization debt	—			(1,161,592		)	—			(1,161,592		)
Net decrease in credit facilities and unsecured commercial paper	—			(634,874		)	—			(634,874		)
Net borrowings of asset-backed commercial paper	—			182,131			—			182,131
Net repayments of asset-backed commercial paper	—			(6,538		)	—			(6,538		)
Net change in restricted cash	—			12,255			—			12,255
Dividends paid	(106,560		)	(225,000		)	225,000			(106,560		)
Purchase of common stock for treasury	(257,981		)	—			—			(257,981		)
Excess tax benefits from share based payments	16,390			—			—			16,390
Issuance of common stock under employee stock option plans	36,342			—			—			36,342
Net cash used by financing activities of continuing operations	(311,809		)	(75,986		)	225,000			(162,795		)
Effect of exchange rate changes on cash and cash equivalents of continuing operations	(5,701		)	(907		)	—			(6,608		)
Net (decrease) increase in cash and cash equivalents of continuing operations	105,099			163,092			—			268,191
Cash flows from discontinued operations:
Cash flows from operating activities of discontinued operations	—			—			—			—
Cash flows from investing activities of discontinued operations	—			—			—			—
Effect of exchange rate changes on cash and cash equivalents of discontinued operations	—			—			—			—
	—			—			—			—
Net (decrease) increase in cash and cash equivalents	$	105,099		$	163,092		$	—		$	268,191
Cash and cash equivalents:
Cash and cash equivalents—beginning of period	$	943,330		$	583,620		$	—		$	1,526,950
Cash and cash equivalents of discontinued operations—beginning of period	—			—			—			—
Net (decrease) increase in cash and cash equivalents	105,099			163,092			—			268,191
Less: Cash and cash equivalents of discontinued operations—end of period	—			—			—			—
Cash and cash equivalents—end of period	$	1,048,429		$	746,712		$	—		$	1,795,141

	Nine months ended September 25, 2011
	Motorcycles & Related Products Operations			Financial Services Operations		Eliminations & Adjustments			Consolidated
Cash flows from operating activities:
Net income	$	487,296		$	131,138	$	(125,000	)	$	493,434
Loss from discontinued operations	—			—		—			—
Income from continuing operations	487,296			131,138		(125,000		)	493,434
Adjustments to reconcile income from continuing operations to cash provided by operating activities:
Depreciation	127,174			4,764		—			131,938
Amortization of deferred loan origination costs	—			59,272		—			59,272
Amortization of financing origination fees	355			7,816		—			8,171
Provision for employee long-term benefits	49,110			1,873		—			50,983
Contributions to pension and postretirement plans	(207,829		)	—		—			(207,829		)
Stock compensation expense	26,282			2,034		—			28,316
Net change in wholesale finance receivables	—			—		77,519			77,519
Provision for credit losses	—			5,005		—			5,005
Loss on extinguishment of debt	—			8,671		—			8,671
Pension and postretirement healthcare plan curtailment and settlement expense	236			—		—			236
Foreign currency adjustments	11,381			—		—			11,381
Other, net	(14,923		)	25,959		—			11,036
Change in current assets and current liabilities:
Accounts receivable	(132,823		)	—		113,350			(19,473		)
Finance receivables—accrued interest and other	—			7,069		—			7,069
Inventories	(19,451		)	—		—			(19,451		)
Accounts payable and accrued liabilities	197,233			125,929		(65,789		)	257,373
Restructuring reserves	2,664			—		—			2,664
Derivative instruments	(2,297		)	18		—			(2,279		)
Other	(930		)	46,070		(47,575		)	(2,435		)
Total adjustments	36,182			294,480		77,505			408,167
Net cash provided by (used by) operating activities of continuing operations	523,478			425,618		(47,495		)	901,601

	Nine months ended September 25, 2011
	Motorcycles & Related Products Operations			Financial Services Operations			Eliminations & Adjustments			Consolidated
Cash flows from investing activities of continuing operations:
Capital expenditures	(100,299		)	(5,816		)	—			(106,115		)
Origination of finance receivables	—			(4,884,163		)	2,720,019			(2,164,144		)
Collections of finance receivables	—			4,927,907			(2,797,538		)	2,130,369
Purchases of marketable securities	(142,653		)	—			—			(142,653		)
Sales and redemptions of marketable securities	104,975			—			—			104,975
Net cash (used by) provided by investing activities of continuing operations	(137,977		)	37,928			(77,519		)	(177,568		)
Cash flows from financing activities of continuing operations:
Proceeds from issuance of medium-term notes	—			394,277			—			394,277
Proceeds from securitization debt	—			571,276			—			571,276
Repayments of securitization debt	—			(1,333,541		)	—			(1,333,541		)
Net borrowings of asset-backed commercial paper	—			(483		)	—			(483		)
Net decrease in credit facilities and unsecured commercial paper	—			182,058			—			182,058
Net change in restricted cash	—			50,679			—			50,679
Dividends paid	(82,557		)	(125,000		)	125,000			(82,557		)
Purchase of common stock for treasury	(97,456		)	—			—			(97,456		)
Excess tax benefits from share based payments	2,702			—			—			2,702
Issuance of common stock under employee stock option plans	7,763			—			—			7,763
Net cash (used by) provided by financing activities of continuing operations	(169,548		)	(260,734		)	125,000			(305,282		)
Effect of exchange rate changes on cash and cash equivalents of continuing operations	(11,815		)	(56		)	14			(11,857		)
Net (decrease) increase in cash and cash equivalents of continuing operations	204,138			202,756			—			406,894
Cash flows from discontinued operations:
Cash flows from operating activities of discontinued operations	(74		)	—			—			(74		)
Cash flows from investing activities of discontinued operations	—			—			—			—
Effect of exchange rate changes on cash and cash equivalents of discontinued operations	—			—			—			—
	(74		)	—			—			(74		)
Net (decrease) increase in cash and cash equivalents	$	204,064		$	202,756		$	—		$	406,820
Cash and cash equivalents:
Cash and cash equivalents—beginning of period	$	791,791		$	230,142		$	—		$	1,021,933
Cash and cash equivalents of discontinued operations—beginning of period	—			—			—			—
Net (decrease) increase in cash and cash equivalents	204,064			202,756			—			406,820
Less: Cash and cash equivalents of discontinued operations—end of period	—			—			—			—
Cash and cash equivalents—end of period	$	995,855		$	432,898		$	—		$	1,428,753