Harley-Davidson is pulling out of India, the world’s biggest motorcycle market. The iconic US motorcycle maker is stopping sales and manufacturing operations, it said. Harley’s decision comes weeks after Toyota said it wouldn’t expand further in India due to the country’s high tax regime. The exit is a blow for Indian Prime Minister Narendra Modi’s efforts to lure or retain foreign manufacturers. The move involves $75m (£59m) in restructuring costs, around 70 redundancies and the closure of its Bawal plant in northern India.
The plant was opened in 2011 but Harley-Davidson has struggled to compete with local brand Hero as well as Japan’s Honda. About 17 million motorcycles and scooters are sold each year in India. While it is cheaper than many other developing economies, India has proven a tough market to crack for foreign automakers. General Motors pulled out of the country in 2017 while Ford agreed last year to move most of its assets into a joint venture with Indian vehicle giant Mahindra & Mahindra. US President Donald Trump has previously complained about India’s high taxes, specifically mentioning the levies placed on Harley-Davidson bikes.
India’s 100% import tariffs were slashed by 50% but the brand still struggled in the competitive market. But Harley has been suffering its own problems and recorded its first quarterly loss in more than a decade between April and June this year. It has been cutting hundreds of jobs under its new chief executive Jochen Zeitz and focusing on core markets and models. Harley has been looking to grow the brand beyond baby boomers in the US, with smaller models and all electric versions.
The iconic US motorcycle brand was founded in 1903 and has built a very loyal customer base. It has owners’ clubs all over the world. It hit the global stage in 1969 thanks to the classic road movie Easy Rider starring Dennis Hopper, Peter Fonda and Jack Nicholson.
It’s bikes, nicknamed “hogs”, are made in factories in the US, Brazil and Thailand, along with India.