TEXT - Fitch rates Harley-Davidson Financial Services commercial paper program

Wed Jan 2, 2013 4:01pm EST

Jan 2 - Fitch Ratings assigns a rating of 'F2' to Harley-Davidson Financial
Services, Inc.'s (HDFS) $1.35 billion commercial paper (CP) program, based on
the rating linkage and core importance of HDFS to its parent company,
Harley-Davidson, Inc. (HOG, rated 'A-' with a Stable Outlook by Fitch) and the
availability of unsecured bank facilities equal to at least 100% of the
outstanding principal amount of the CP.

Historically, the $1.35 billion CP program was maintained by Harley-Davidson 
Funding Corp. (HDFC), as part of this transaction, HDFC was merged into HDFS. 
Thus, the new CP program at HDFS is effectively replacing the existing CP 
program at HDFC. With the merger complete, Fitch expects to withdraw the ratings
of HDFC's commercial paper rating; however, the ratings assigned to HDFC's 
medium-term notes will remain outstanding until their maturity.

  

HDFS's new CP program includes an upstream guarantee by Harley-Davidson Credit 
Corp., which is also a guarantor for the existing HDFC CP program. The CP 
program will also be backed by one or more unsecured bank facilities with 
availability equal to at least 100% of the outstanding principal amount of the 
CP.

HDFS is the captive finance subsidiary of (HOG), a manufacturer of motorcycles. 
HDFS's long- and short-term Issuer Default Ratings are not expected to be 
affected by the new CP program or the merger of HDFC into HDFS as HDFS was 
already a guarantor for the HDFC CP program. 

RATING DRIVERS AND SENSITIVITIES

The IDRs and senior debt ratings for HDFS are linked to those of its parent, as 
Fitch believes HDFS is core to HOG's overall franchise. HDFS's ratings reflect 
its close operating relationship with HOG, which is governed by a support 
agreement in favor of debt holders under which HOG must maintain HDFS's fixed 
charge coverage ratio at 1.25x and minimum net worth of $40 million.

Fitch assigns the following rating:

Harley-Davidson Financial Services, Inc.
--Commercial Paper 'F2'
Rating Outlook Stable
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