Iconic motorcycle manufacturer of the
US and a favourite company of US President Donald Trump is beginning to appreciate
the flavour of Indian curry. It has just announced its own recipe for the
Indian palate wherein it would be manufacturing motorcycles in the range of
250cc to 500 cc within two years for which it would be entering into a
strategic alliance with a company in Asia.
With this, Harley-Davidson would be
taking head on the market leader in the country – Royal Enfield of the Eicher
Group. The latter has been dominating this space for a very long time with its
range of motorcycles that are in a way dated in technology and looks in a world
full of modern technology run motorcycles. Already this 250cc to 500cc space is
beginning to be explored by the likes of TVS Motor Company and BMW. Bajaj Auto
has also entered into an alliance with Triumph Motorcycles of the UK to explore
this space. Other motorcycle makers in India too are gunning for this space.
Currently, Harley-Davidson India sells
motorcycles in India in the price range of Rs 5.25 lakh (for the
Harley-Davidson Street 750) to Rs 49.99 lakh (for the CVO Limited). The company’s
touring bike Road Glide Special costs Rs 32.99 lakh. Incidentally, the HD
Street 750 is the model that brings the sales numbers for the US company in India.
The company also plans to push its
electric dream by launching its first electric motorcycle, LiveWire, in 2019 --
the first in a broad, no-clutch “twist and go” portfolio of electric
two-wheelers designed to establish the company as the leader in the
electrification of the sport.
The latest Harley-Davidson future
plans were revealed in an investor communication sent out on July 30, 2018
titled, ‘More Roads to Harley-Davidson: Accelerated Strategy’. The company
clearly stated that it would not only be launching these 250cc to 500cc motorcycles
in India within two years but would also in other emerging markets in Asia over
The company’s 2027 objective includes
building 2 million new Harley-Davidson riders in the US, grow international
business to 50pc of annual volume, launch 100 new high impact HD motorcycles,
deliver superior return on invested capital for HDMC and grow its business
without growing its environmental impact.
The company hopes that by adopting a
new strategy, it would be able to grow its revenues by 2022 to $1.5 billion
from the current level of US $ 1.0 billion. It also expects its operating profit
to increase from $ 200m to $250 million. The urgency to address challenges is driven by
a shifting global consumer, said the report. It pointed out that consumer
spending on discretionary, premium products is reaching critical mass in China,
India and Southeast Asia. While China motorcycle volumes are expected to grow
rapidly, India’s 250cc-500cc motorcycle segment is expected to grow at 25%/yr through
2021. India’s 250cc-500cc sales volume in 2017 stood at 700,000 with a CAGR of 25%.
In the 500cc and more segment, overall sales stood at 8,500 units (CAGR
“The bold actions we are announcing
today leverage Harley-Davidson’s vast capabilities and competitive firepower –
our excellence in product development and manufacturing, the global appeal of
the brand and of course, our great dealer network,” said Matt Levatich,
president and chief executive officer, Harley-Davidson, Inc. “Alongside our
existing loyal riders, we will lead the next revolution of two-wheeled freedom
to inspire future riders who have yet to even think about the thrill of riding,”
“We expect this plan will result in an
engaged, expanded Harley-Davidson community with a more diverse rider base,
along with industry-leading margins and cash flow,” said Levatich.
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