Fitch Expects to Rate Harley-Davidson Motorcycle Trust 2011-2

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CHICAGO--(BUSINESS WIRE)-- Fitch Ratings expects to rate Harley-Davidson Motorcycle Trust 2011-2 as detailed below.

Harley-Davidson Motorcycle Trust 2011-1

--$109,000,000 class A-1 notes 'F1+sf';

--$195,000,000 class A-2 notes 'AAAsf'; Outlook Stable;

--$131,000,000 class A-3 notes 'AAAsf'; Outlook Stable;

--$63,800,000 class A-4 notes 'AAAsf'; Outlook Stable;

--$26,200,000 class B notes 'AAsf'; Outlook Stable;

--$23,027,000 class C notes 'Asf'; Outlook Stable.

Fitch's stress and rating sensitivity analysis are discussed in the presale report titled 'Harley-Davidson Motorcycle Trust 2011-1', dated Oct. 31, 2011, which is available on Fitch's web site. The presale report details how Fitch addresses the key rating drivers which are summarized below.

Key Rating Drivers

Strong Credit Quality: The weighted average (WA) Fair Isaac Corporation (FICO) score of 714 is the highest ever in a HDMOT transaction. This, along with a low WA original term (WAOT) of 71 months, is evidence of the strength of the 2011-2 pool. The new motorcycle concentration, although down from 2009 transactions, is consistent with the prior two transactions, and geographic diversity has improved over recent pools.

Sufficient Credit Enhancement Structure: The cash flow distribution in 2011-2 is a sequential-pay structure, consistent with prior transactions. Initial hard credit enhancement (CE) in 2011-2 is down relative to recent deals. CE is sufficient for all classes of notes to cover stressed expected lifetime cumulative net losses (CNLs).

Improving Portfolio/Securitization Performance: Portfolio and securitization delinquencies and losses have continued to trend lower from 2009?2011. This is driven by a stabilizing economy, underwriting changes that began in 2008, and Harley resale values, which are currently at their strongest levels in years.

Stable Corporate Health: HDCC has exhibited good capabilities as an originator, underwriter, and servicer of its managed portfolio and securitizations. Further, Harley-Davidson Financial Services (HDFS), the parent of HDCC, is rated 'F2/BBB+', and its parent, HOG, is rated 'BBB+' with a Positive Rating Outlook by Fitch. Fitch deems HDCC an adequate servicer to service 2011-2.

Legal Structure Integrity: The legal structure of the transaction should provide that a bankruptcy of HDCC would not impair the timeliness of payments on the securities.

Additional information is available at 'www.fitchratings.com'. The ratings above were solicited by, or on behalf of, the issuer, and therefore, Fitch has been compensated for the provision of the ratings.

Applicable Criteria and Related Research:

--' U.S. Auto Loan ABS Rating Criteria," dated April 20, 2011';

--'Global Structured Finance Rating Criteria' dated Aug. 4, 2011.

Applicable Criteria and Related Research: Harley-Davidson Motorcycle Trust 2011-2 (US ABS)

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=654769

Global Structured Finance Rating Criteria

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=646569

U.S. Auto Loan ABS Rating Criteria

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=614367

ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S PUBLIC WEBSITE 'WWW.FITCHRATINGS.COM'. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE 'CODE OF CONDUCT' SECTION OF THIS SITE.

Fitch RatingsSandro Scenga, +1-212-908-0278Media Relations, New York[email protected]orPrimary Analyst:Du Trieu, +1-312-368-2091Senior Director70 W. MadisonChicago, IL 60602orSecondary Analyst:Peter Manofsky, +1-312-368-2068Associate DirectororCommittee Chairperson:Brad Sohl, +1-312-368-3127Senior Director

Source: Fitch Ratings

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