Harley-Davison who had earlier announced their departure from the Indian market has just done a complete U-turn. In a recent development, Harley Davidson has announced a partnership with Hero MotoCorp in the country. Under the new distributor partnership, Hero Motocorp will sell and service the iconic American brand’s motorcycles in India. Earlier in September this year, the American motorcycle maker took a decision of discontinuing their sales and manufacturing operations in the country.
As per the distribution pact, Hero MotoCorp will develop and retail a premium range of bikes under the Harley-Davidson brand name in the domestic market. Apart from bikes, components, accessories, apparel and riding gear will also be available through Harley-Davidson dealers as well as Hero’s authorized outlets in India.
Harley Davidson first made its entryway back in 2009 but struggled to create a niche for itself in the premium motorcycle segment. Despite Harley's departure announcement, there was scepticism in the industry about the sudden decision to leave one of the fastest-growing two-wheeler markets. Their departure could have meant that another American brand - Indian Motorcycles would have got the opportunity to expand their product portfolio. But that was not to happen, as rumours of a tie-up between the 2 manufacturers was always in the news and now the official declaration has ended all the speculation.
"This arrangement is mutually beneficial for both companies and riders in India, as it brings together the iconic Harley-Davidson brand with the strong distribution network and customer service of Hero MotoCorp," said Hero MotoCorp in a press statement to the media outlets. The new decision is huge as it signals the intent of the American manufacturer to keep on retailing its premium range of offerings to the upwardly moving Indian consumers. It’s a win-win situation for the Indian buyers as they can keep on buying the official merchandise and bikes here without shelling a bomb on importing it.
Harley-Davidson's decision to leave India was on the back of the COVID-19 outbreak hitting its financial bottom line. India only contributed 5 percent of its earnings globally. Production-wise also the company struggled as its volumes dipped sharply from 11,753 units in 2016 to just 4,533 units in 2020 in India. This decision to leave the country was part of the global restructuring plans to further reduce costs. As per earnings disclosed, motorcycles and related product revenue slipped downwards to $964 million in the third quarter from $1.07 billion a year earlier. The 9.8 percent drop in revenue comes on the back of slow motorcycle growth worldwide. With a new restructuring plan, Harley-Davidson will focus on markets like North America, Europe and Asia-Pacific.