Harley Davidson has announced that as part of ‘The Rewire’ (planned to continue through the end of 2020), it will overhaul its operating model and market structure in India, pointing to a wrap-up from the country.
About 70 of its employees will be laid off as a result.
According to the company, these actions will lead to ‘The Hardwire’, a new strategic plan for 2021-2025, which is aimed at building desirability for Harley-Davidson brand and products.
The company is changing its business model in India and evaluating options to continue to serve its customers.
It has planned to close its manufacturing facility in Bawal and significantly reduce the size of its sales office in Gurgaon. The company is communicating to its customers in India around the move.
The Harley-Davidson dealer network will continue to serve customers through the contract term.
In August, the company had indicated exiting some of the loss-making international markets to focus on the US market.
Entering the Indian market back in 2009, Harley-Davidson's sales in India accounted for just about 5% of its global total. In February this year, it completed the 25,000 sales mark in India – and it took 10 years to achieve that feat.
While India is a key market for the company, it somehow failed to show retail sales growth in the past 14 quarters. Covid-19 further hampered the prospects. The last quarter saw a year-on-year dip in retail sales of 27%, the worst-ever in the past six years. The company had sold less than 2,500 units in the last financial year, making it one of its worst-performing international markets.
The losses for some time had been attributed for the brand’s failure at finding suitable local partner for the market. While the brand remained in glorious isolation, there were rumours of a potential tie-up with India's largest two-wheeler maker Hero MotoCorp.
Harley-Davidson isn’t the first auto brand exiting the market. Brands such as General Motors, Fiat, Ssangyong, Scania, MAN and UM Motorcycles have exited India over the last 3-4 years.