Last week, when Harley announced it would shut it’s India operations, it didn’t come up as a surprise. The American motorcycle maker has been struggling globally for the past few years, more so in India. Word is that Harley Davidson is in talks with India’s largest two-wheeler maker, Hero Motocorp for a distribution setup. The exit of Harley will lead up to 2000 job losses in India. But, this is not a permanent exit from India.
Harley came to Indian shores more than a decade ago and they have manged only to sell about 25,000 bikes in India so far. They started out by importing and selling CBU motorcycles and later swithced to assembling CKD kits. The CKD kits imported from The US were assembled in Harley’s plant at Bawal, Haryana. The deal will grant Hero Motorcorp, the sole rights to distribute Harley’s products in India. But wait! there is more to it as “Contract Manufacturing” is also said to be a part of the deal.
What does the deal mean?
If the deal goes through, Hero Motocorp could also be manufacturing Harley’s Motorcycles in India. This means that Harley will continue to operate in India at a lowered cost, translating to a lower pricing structure for the bikes. As a part of the deal, Harley’s 33 existing dealerships could continue to operate under Hero Motocorp. It is also said that Hero Motorcorp is not looking to take over Harley’s Bawal plant – meaning HDs will be manufactured at Hero’s facilities. There is no official statement from both the companies yet, but reports suggest that an official statement could be expected within 2-3 weeks.
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