Harley-Davidson was founded in 1903 by Arthur and Walter Harley and William Davidson. During its first years of existence the company experienced an enormous amount of growth. Harley-Davidson gained its popularity two ways. The reputation of the firm was linked to Davidson riding Harley's motorcycle to victory in a 1908 race. The second reason, even more important, was by providing innovations to marketed products such as the V-twin engine, clutch, internal expanding rear brake, and the three-speed transmission. By 1918 Harley-Davidson became the world's largest motorcycle company by producing 28,000 motorcycles annually.
In the early 1940s (during WWII) Harley-Davidson had another chance to increase production. The company's motorcycles were used by the military as dispatch and scout bikes. In 1943 the firm noticed growth of production to 29,000 units. This promising trend was one of the reasons behind the firm's decision to open a plant in Wauwatosa, Wisconsin. After War World II, for the first time in their history, Harley-Davidson faced competition pressures from Europe. American GIs stationed in the United Kingdom had developed a taste for smaller and more efficient British motorcycles such as the Norton and the Triumph. Despite weak demand and European competition Harley-Davidson stayed the undisputed leader in the American market with over 60% of the market share and $20 million in sales.
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