HARLEY-DAVIDSON, INC.

                         2001 YORK HOURLY-PAID EMPLOYEES

                                STOCK OPTION PLAN

                                   ARTICLE I

                                     PURPOSE
                                     -------

          The purpose of the Harley-Davidson, Inc. 2001 York Hourly-Paid
Employees Stock Option Plan is to provide favorable opportunities for non-exempt
employees at the Harley-Davidson Motor Company York, Pennsylvania facility to
purchase shares of Common Stock of Harley-Davidson, Inc. Such opportunities
should provide an increased incentive for these employees to contribute to the
future success and prosperity of Harley-Davidson, Inc., thus enhancing the value
of the stock for the benefit of the shareholders, and increase the ability of
Harley-Davidson, Inc. to attract and retain individuals of exceptional skill
upon whom, in large measure, its sustained progress, growth and profitability
depend.

                                   ARTICLE II

                                   DEFINITIONS
                                   -----------

          The following capitalized terms used in the Plan shall have the
respective meanings set forth in this Article:

          2.1. Board: The Board of Directors of Harley-Davidson, Inc.

          2.2. Code: The Internal Revenue Code of 1986, as amended.

          2.3. Committee: The Human Resources Committee of the Board.

          2.4. Common Stock: The common stock of Harley-Davidson, Inc.

          2.5. Company: Harley-Davidson, Inc. and any of its Subsidiaries.

          2.6. Disability: Disability retirement under the Retirement Annuity
Plan for York Hourly-Paid Employees of Harley-Davidson.

          2.7. Fair Market Value: The average of the high and low reported sales
prices of Common Stock on the New York Stock Exchange Composite Tape on the date
for which fair market value is being determined.

          2.8. Non-ISO: A stock option which is not an incentive stock option
within the meaning of Section 422 of the Code.

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          2.9. Option: A stock option granted under the Plan.

          2.10. Option Price: The purchase price of a share of Common Stock
under an Option.

          2.11. Optionee: A person who has been granted one or more Options.

          2.12. Parent Corporation: The parent corporation, as defined in
Section 424(e) of the Code.

          2.13. Plan: The Harley-Davidson, Inc. 2001 York Hourly-Paid Employees
Stock Option Plan.

          2.14. Retirement: Normal, deferred, early, or thirty and out
retirement under the terms of the Retirement Annuity Plan for York Hourly-Paid
Employees of Harley-Davidson.

          2.15. Subsidiary: A corporation, limited partnership, general
partnership, limited liability company, business trust or other entity of which
more than fifty percent (50%) of the voting power or ownership interest is
directly and/or indirectly held by Harley-Davidson, Inc.

          2.16. Termination Date: A date fixed by the Committee but not later
than the day preceding the tenth anniversary of the date on which the Option is
granted.

                                  ARTICLE III

                                 ADMINISTRATION
                                 --------------

          3.1. The Committee shall administer the Plan and shall have full power
to grant Options, construe and interpret the Plan, establish and amend rules and
regulations for its administration, and perform all other acts relating to the
Plan, including the delegation of administrative responsibilities, which it
believes reasonable and proper.

          3.2. Subject to the provisions of the Plan, the Committee shall, in
its discretion, determine who shall be granted Options, the number of shares
subject to option under any such Options, the dates after which Options may be
exercised, in whole or in part, and the terms and conditions of the Options.

          3.3. Any decision made, or action taken, by the Committee arising out
of or in connection with the interpretation and administration of the Plan shall
be final and conclusive.


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                                   ARTICLE IV

                           SHARES SUBJECT TO THE PLAN
                           --------------------------

          4.1. The total number of shares of Common Stock available for grants
of Options under the Plan shall be three hundred thousand (300,000) shares.

                                   ARTICLE V

                                   ELIGIBILITY
                                   -----------

          5.1. Options may be granted to all full time, regular, production and
maintenance employees of the Company covered by the collective bargaining
agreement in effect between the Company and Tyson Lodge 175, District 98, of the
International Association of Machinists & Aerospace Workers, AFL/CIO (or any
successor thereto).

                                   ARTICLE VI

                                 TERM OF OPTIONS
                                 ---------------

          6.1. Option Agreements: All Options shall be evidenced by written
agreements executed by the Company. Such Options shall be subject to the
applicable provisions of the Plan, and shall contain such provisions as are
required by the Plan and any other provisions the Committee may prescribe. All
agreements evidencing Options shall specify the total number of shares subject
to each grant, the date of the grant, the Option Price and the Termination Date.
All Options shall be Non-ISOs.

          6.2. Option Price: The Option Price shall be set by the Committee;
provided, however, that the price per share shall not be less than the Fair
Market Value of a share of Common Stock as of the date the Option is granted.

          6.3. Period of Exercise: The Committee shall determine the dates after
which Options may be exercised in whole or in part. If Options are exercisable
in installments, installments or portions thereof that are exercisable and not
exercised shall accumulate and remain exercisable. The Committee may also amend
an Option to accelerate the dates after which Options may be exercised in whole
or in part. However, no Option or portion thereof shall be exercisable after the
Termination Date.

          6.4. Manner of Exercise and Payment: An Option, or portion thereof,
shall be exercised by delivery of a written notice of exercise to the Company
and payment of the full price of the shares being purchased pursuant to the
Option. An Optionee may exercise an Option with respect to less than the full
number of shares for which the Option may then be exercised, but an Optionee
must exercise the Option in full shares of Common Stock. The price of Common
Stock purchased pursuant to an Option, or portion thereof, may be paid:


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               a. in United States dollars in cash or by check, bank draft or
     money order payable to the order of the Company.

               b. through the delivery of shares of Common Stock with an
     aggregate Fair Market Value on the date of exercise equal to the Option
     Price, or

               c. by any combination of the above methods of payment.

The Committee shall determine acceptable methods for tendering Common Stock as
payment upon exercise of an Option and may impose such limitations and
prohibitions on the use of Common Stock to exercise an Option as it deems
appropriate, including, without limitation, any limitation or prohibition
designed to avoid certain accounting consequences which may result from the use
of Common Stock as payment upon exercise of an Option.

          6.5. Withholding Taxes: The Company may, in its discretion, require an
Optionee to pay to the Company at the time of exercise the amount that the
Company deems necessary to satisfy its obligation to withhold Federal, state or
local income or other taxes incurred by reason of the exercise. Upon or prior to
the exercise of an Option requiring tax withholding, an Optionee may make a
written election to have shares of Common Stock withheld by the Company from the
shares otherwise to be received. The number of shares so withheld shall have an
aggregate Fair Market Value on the date of exercise sufficient to satisfy the
applicable withholding taxes. The acceptance of any such election by an Optionee
shall be at the sole discretion of the Committee.

          6.6. Nontransferability of Options: Each Option shall, during the
Optionee's lifetime, be exercisable only by the Optionee and neither it nor any
right hereunder shall be transferable otherwise than by will or the laws of
descent and distribution or be subject to attachment, execution or other similar
process. In the event of any attempt by the Optionee to alienate, assign,
pledge, hypothecate or otherwise dispose of an Option or of any right hereunder,
except as provided for herein, or in the event of any levy or any attachment,
execution or similar process upon the rights or interest hereby conferred, the
Company may terminate the Option by notice to the Optionee and the Option shall
thereupon become null and void.

          6.7. Cessation of Employment of Optionee:

                    a. Cessation of Employment other than by Reason of
          Retirement, Disability or Death. . Except as may be otherwise provided
          by the Committee, if an Optionee shall cease to be employed by the
          Company otherwise than by reason of Retirement, Disability, or death,
          (i) each Option held by the Optionee, together with all rights
          thereunder, that is not vested shall terminate on the date of
          cessation of employment, to the extent not previously exercised and
          (ii) the Optionee shall have a period of 90 days from the date of
          cessation of employment to exercise each Option held by the Optionee
          that is vested on the date of cessation of employment. At the end of
          such 90-day period, each such


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          Option that has not been exercised, together with all rights
          thereunder, shall terminate, to the extent not previously exercised."

                    b. Cessation of Employment by Reason of Retirement or
          Disability. If an Optionee shall cease to be employed by the Company
          by reason of Retirement or Disability, each Option held by the
          Optionee shall remain exercisable, to the extent it was exercisable at
          the time of cessation of employment, until the earliest of:

                         i. the Termination Date,

                         ii. the death of the Optionee, or such later date not
          more than one year after the death of the Optionee as the Committee,
          in its discretion, may provide pursuant to Section 6.7(c) of the Plan,

                         iii. the third anniversary of the date of the cessation
          of the Optionee's employment, if employment ceased by reason of
          Retirement, or

                         iv. the first anniversary of the date of the cessation
          of the Optionee's employment by reason of Disability;

          and thereafter all such Options shall terminate together with all
          rights hereunder, to the extent not previously exercised.

                    c. Cessation of Employment by Reason of Death. In the event
          of the death of the Optionee while employed by the Company, an Option
          may be exercised at any time or from time to time prior to the earlier
          of the Termination Date or the first anniversary of the date of the
          Optionee's death, by the person or persons to whom the Optionee's
          rights under each Option shall pass by will or by the applicable laws
          of descent and distribution, to the extent that the Optionee was
          entitled to exercise such Option on the Optionee's date of death. In
          the event of the death of the Optionee while entitled to exercise an
          Option pursuant to Section 6.7(b), the Committee, in its discretion,
          may permit such Option to be exercised at any time or from time to
          time prior to the Termination Date during a period of up to one year
          from the death of the Optionee, as determined by the Committee, by the
          person or persons to whom the Optionee's rights under each Option
          shall pass by will or by the applicable laws of descent and
          distribution, to the extent that the Option was exercisable at the
          time of cessation of the Optionee's employment. Any person or persons
          to whom an Optionee's rights under an Option have passed by will or by
          the applicable laws of descent and distribution shall be subject to
          all terms and conditions of the Plan and the Option applicable to the
          Optionee.


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                                  ARTICLE VII

                                   ADJUSTMENTS
                                   -----------

          7.1. If (a) the Company shall at any time be involved in a transaction
to which Section 424(a) of the Code is applicable; (b) the Company shall declare
a dividend payable in, or shall subdivide or combine, its Common Stock, or (c)
any other event shall occur which in the judgment of the Committee necessitates
an adjustment to prevent dilution or enlargement of the benefits or potential
benefits intended to be made available under the Plan, then the Committee may,
in such manner as it may deem equitable, adjust any or all of (i) the number and
type of securities subject to the Plan and which thereafter may be the subject
of Options; (ii) the number and type of securities subject to outstanding
Options; (iii) the Option Price with respect to any Option; and (iv) the number
of shares of Common Stock that may be issued pursuant to Options granted to an
Optionee in any calendar year. The judgment of the Committee with respect to any
matter referred to in this Article shall be conclusive and binding upon each
Optionee.

                                  ARTICLE VIII

                        AMENDMENT AND TERMINATION OF PLAN
                        ---------------------------------

          8.1. The Board may at any time, or from time to time, suspend or
terminate the Plan in whole or in part or amend it in such respects as the Board
may deem appropriate.

          8.2. No amendment, suspension or termination of this Plan shall,
without the Optionee's consent, alter or impair any of the rights or obligations
under any Option theretofore granted to an Optionee under the Plan.

          8.3. The Board may amend this Plan, without the limitation, in such
manner as it deems necessary to permit the granting of Options meeting the
requirements of future amendments or issued regulations, if any, to the Code.

                                   ARTICLE IX

                        GOVERNMENT AND OTHER REGULATIONS
                        --------------------------------

          9.1. The obligation of the Company to issue or transfer and deliver
shares for Options exercised under the Plan shall be subject to all applicable
laws, regulations, rules, orders and approvals which shall then be in effect and
required by governmental entities and the stock exchanges on which Common Stock
is traded.


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<PAGE>

                                   ARTICLE X

                            MISCELLANEOUS PROVISIONS
                            ------------------------

          10.1. Plan Does Not Confer Employment or Shareholder Rights: The right
of the Company to terminate (whether by dismissal, discharge, retirement or
otherwise) the Optionee's employment with it at any time at will, or as
otherwise provided by any agreement between the Company and the Optionee, is
specifically reserved. Neither the Optionee nor any person entitled to exercise
the Optionee's rights in the event of the Optionee's death shall have any rights
of a shareholder with respect to the shares subject to each Option, except to
the extent that, and until, such shares shall have been issued upon the exercise
of each Option.

          10.2. Plan Expenses: Any expenses of administering this Plan shall be
borne by the Company.

          10.3. Use of Exercise Proceeds: Payments received from Optionees upon
the exercise of Options shall be used for the general corporate purposes of the
Company, except that any stock received in payment may be retired, or retained
in the Company's treasury and reissued.

          10.4. Indemnification: In addition to such other rights of
indemnification as they may have as members of the Board or the Committee of the
Company, the members of the Board and the Committee shall be indemnified by the
Company against all costs and expenses reasonably incurred by them in connection
with any action, suit or proceeding to which they or any of them may be party by
reason of any action taken or failure to act under or in connection with the
Plan or any Option granted thereunder, and against all amounts paid by them in
settlement thereof (provided such settlement is approved by independent legal
counsel selected by the Company) or paid by them in satisfaction of a judgment
in any such action, suit or proceeding, except a judgment based upon a finding
of bad faith; provided that upon the institution of any such action, suit or
proceeding a Board member or the Committee shall, in writing, give the Company
notice thereof and an opportunity, at its own expense, to handle and defend the
same before such Board member or Committee undertakes to handle and defend it on
such member's own behalf.

                                   ARTICLE XI

                                 EFFECTIVE DATE
                                 --------------

          11.1. The Plan shall become effective when it is approved by the
Board.


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