In a renewed effort to capture the premium end of India’s 17 million-plus two-wheeler market, now the largest in the world, Harley Davidson, the legendary American bike manufacturer, is hitching a ride with local market leader Hero MotoCorp
Despite discontinuing its operations in the region, Harley assessed options for retaining its presence in India, promising substantial growth opportunities for more luxury bikes with growing affordability and rising incomes.
Hero will produce and sell a range of premium Harley Davidson motorcycles in India as part of the collaboration, the agreement neatly dovetailing into the strategy of Hero to ascend the value chain and register its presence in the performance-bike section.
“For both businesses and riders in India, this partnership is mutually beneficial, as it brings together the iconic Harley Davidson brand with Hero MotoCorp ‘s solid distribution network and customer support,” the Indian partner said.
The tie-up comes after several months of speculation about the industry. In September this year, Harley agreed to shut down its operations in India as part of its global ‘Rewire’ plan.
Hero will provide the backbone of sales and service for Harley’s stuttering operations in India. Hero will be selling Harley goods in India through its distributor network as part of the distribution contract. As fully built-up units (CBUs), these goods will be imported.
Hero may also offer parts, accessories, and general merchandise riding equipment and apparel through the brand-exclusive Harley-Davidson dealer network, but all current Harley Davidson outlets will not be retained.
In India, Harley Davidson has 22 dealer partners across 33 contact points. The company has sold more than 25,000 units so far in its 10-year history in India.
In September, Harley Davidson said that in India it was “evaluating options to continue to serve its customers.” The company had told dealers that after December 31, it would not be renewing contracts.
This collaboration with Harley Davidson is in line with the ‘Make, Collaborate & Empower’ mission of Hero. To broaden its product range and global scope, Hero MotoCorp has been aggressively searching for new partners.
One of the reasons why Harley decided to quit the Indian market was the revenue from motorcycles and related goods dipped 53 percent year-on-year to $669 million, hurt during the quarter by the temporary suspension of production due to lockdowns to curb the spread of the new coronavirus.
In the United States, the main market, retail revenues plummeted 27 percent year-on-year, the steepest decline in at least six years.
Harley-Davidson Inc. (HOG) was amongst the S&P 500 ‘s largest fallers on Wednesday. With 2.68 million shares changing hands, the company suffered a 2.84 percent fall to $23.28.