Somehow the MoCo has been able to gain favorable treatment from the legislature and various governmental agencies over the years, such that they don't have the same rules and constraints that the auto industry has. Auto companies are required to compensate dealers fairly for warranty work, and that includes reimbursing parts at normal markups and labor at the dealer's normal labor rate. Of course the time standards used for warranty are the ones published by the manufacturer, not the fairy tales published by the folks like Chilton. Any auto dealership that loses money on warranty repairs is incompetent or has someone cooking the books.
Harley dealers need to join the NADA (National Automobile Dealers Association), or start their own organization, and demand the same sort of rights that auto dealers enjoy. In the meantime, don't ask me to feel sorry for them if they don't make a fortune on warranty work. They make more than enough profit on bikes and parts and accessories to cover the difference. The guys turning the wrenches might get screwed, but the dealer is doing just fine in most cases.
Jerry