Harley-Davidson Shuts Down India Operations

Andrew Cummings
September 25, 2020

In April 2007, the then Indian government had relaxed emission and testing norms, paving the way for import of Harley Davidson bikes to India, in return for allowing mango exports from the country to the US. Over the past few months, Harley-Davidson has been announcing multiple cost-saving measures as part of its new Rewire business strategy. Just as premium worldwide brands like Ferrari, MV Agusta and others have no official company owned business presence in India, Harley-Davidson could also sell motorcycles and provide support to existing customers via an Indian business partner.

According to an earlier report, Harley-Davidson plans to reduce its product portfolio by 30%.

"Full implementation of these Rewire actions may require the Company to commit additional funds for additional contract termination and other costs".

"When a brand leaves a country, it results in unavailability of spares and service, makes customers anxious and consumer cases follow", he said, referring to recent exits by General Motors, MAN Trucks and UM Motorcycles.

In a statement issued locally, the company said it is shutting down its manufacturing plant in Bawal, Haryana, and is significantly reducing the size of its sales office in Gurgaon.

"As a result, Harley-Davidson bikes stood no chance in the face of the competition".

Moreover, the company is communicating with its customers in India and promises to keep them updated on future support. In a price-sensitive market, the company failed to bring affordable models (its lowest powered on sale in India is the Street 750cc, priced at Rs 4.7 lakh ex-showroom) in line with the demand of the broader market, despite doing local assembly at Bawal. If you are a Harley-Davidson owner in India, you don't need to worry as of now as the company aims to continue offering its after-sales support just like before.

There are now 33 Harley-Davidson dealerships across the Indian sub-continent with the report saying each will have different contract terms although there was no clear indication of how existing Harley-Davidson customer would be supported in terms of service and spares. Moreover, we have learnt that the company's dealerships across India will remain functional as of now until further announcement. "Including previously disclosed restructuring charges, the Company expects total restructuring expenses associated with Rewire restructuring actions approved through September 23, 2020 of approximately $169 million in 2020", Harley Davidson told the SEC. While the premium bike segment here has grown and Harley-Davidson has played a part in it, it still remains rather nascent.

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