Recently, the Milwaukee-based motorcycle brand, Harley Davidson announced that it is shutting down their manufacturing plant in India. The company was a failure in increasing its sales in the Indian market. The company shut off all its sales and manufacturing operations in India after a decade of unfruitful returns.
As per FADA, around 2000 jobs would be lost due to the closure of Harley Davidson’s operations in India. According to reports, Hero MotorCorp is said to be linking a deal with the Harley Davidson which will permit the distribution rights of the latter in India. This arrangement of distribution will allow the bikemakers of India to import and sell Harley Davidson bikes in India.
However, there has been no official word from either of the companies. Hero MotoCorp could also manufacture Harley Davidson motorcycles in India. A Harley official was recently quoted saying, “This is not a permanent exit. We are evaluating all options to maintain a presence in the Indian market after December.”
Currently, both companies are working out the modalities of managing Harley’s 33 outlets in India. Harley in India HD arrived in India about a decade back. At first, they only sold CBUs. Later, Harley Davidson started assembly operations and brought completely knocked down (CKD) kits imported from the USA at their facility in Bawal, Haryana. The company is currently in the process of laying off its workers and informing its dealers and suppliers about reimbursements and future plans.
Harley Davidson could only sell 25,000 units of its motorcycles in India in its whole operation. On the other hand, Hero Motor Corp is the largest two-wheeler manufacturer in India thus showing the possibility that it will acquire Harley’s operations in India.
If the deal does materialise, then Harley could continue its operations in India at a considerably lower cost structure than before. Harley Davidson is currently evaluating options to continue offering servicing and spare parts to its existing customers.