Harley-Davidson may ride out of India as it looks to 'Rewire'

Hurt by sluggish sales, the US-based premium motorcycle manufacturer Harley-Davidson is likely to end its India operations in a little over a decade after entering the country, as part of the company’s ‘Rewire’ strategy being implemented globally under the new chief executive officer (CEO), Jochen Zeitz.

The company, which came to India in August 2009, has already scaled down operations at its Bawal assembly unit in Haryana and has also laid off workers due to the crisis caused by COVID-19.

The company is looking to outsource the assembly facility to other automakers, The Hindu reported quoting a person aware of the company’s plans. It will maintain skeletal operation at the plant and may bring fully imported bikes into the market, the person said.

The decision to wind up operations in India comes as the company, which has been struggling globally especially in the wake of the coronavirus pandemic, looks to focus more on its core markets such as the United States and Europe and on higher-margin heavyweight and touring bikes under the ‘Rewire’ strategy.

After its second-quarter results in July, the company said it is “evaluating plans to exit international markets, where volumes and profitability do not support continued investment in line with the future strategy.”

Media reports suggested that the company’s India managing director Sajeev Rajasekharan may be shifted to Singapore and be given the responsibility of a few Asian markets.

In the Indian premium bikes market dominated by Royal Enfield, the Milwaukee-based giant did not find much takers for its heavy cruisers and tourism bikes, hurting sales.

It sold less than 2,500 units in the last financial year and could sell only about 100 bikes in the first quarter of the current financial year, according to industry sources, The Hindu reported. In FY19, the company had sold only about 1,500 units, although it led in exports with over 5,000 units. It sold about 2,000 units in FY18.