Table of Contents
What happened?
- There has been a world-wide shutdown of operations by Harley-Davidson.
- It has exited from nearly 40 global markets.
Why it decided to close in India?
- In September, Harley had announced the closure of India operations after 11 years of poor performance, which saw the company sell only 25,000 units –
- Far short of its annual target of selling 10,000 units
Now what?
- On Tuesday, Harley-Davidson said it has decided to hand over sales, service and distribution of its products to Delhi-based Hero MotoCorp.
- Hero will also take care of sales of parts, accessories, general merchandise, riding gear and apparels of Harley-Davidson.
- This arrangement is similar to revamped distribution models being piloted by Harley in 16 other markets outside the United States, apart from India.
- While Harley-Davidson announced the shutting down of Bawal, the Haryana-based assembly factory a month ago, Hero MotoCorp clarified that it won’t be taking over the plant.
- Speaking to analysts, Jochen Zeitz, chairman, president and CEO, Harley-Davidson, said:
- “Under our focussed participation model, we are exiting about 40 markets where low volumes and little profit do not warrant investments.
- We are establishing dealer-direct or distributor model in about 17 markets.
- Our 36 highest potential markets will have the leadership, resources and clearly defined operating framework.”
Does it involve transfer of technology?
- This is being defined as a non-equity tie-up — a distribution-based partnership that does not involve transfer of technology from Harley.
- A licensing agreement allows Hero to develop and sell a range of premium motorcycles under the Harley-Davidson brand name.
How it’ll help both?
- The partnership is expected to help both companies.
- While Harley-Davidson bikes will still have a presence in India.
- The robust and widespread sales and service network of Hero MotoCorp will now open up.
- For Hero, the partnership with Harley could propel the company to become a significant player in the domestic market for mid-sized motorcycles,
- Dominated currently by Eicher Motors Ltd’s
- Royal Enfield
- Over the years, mid-size segment has seen several new entrants such as Honda Motorcycle and Scooter India, Triumph Motorcycles, BMW and Ducati either through local assembly or by importing fully-built units.
- The premium bike segment has seen some momentum in recent times with several players jostling for space.
- While not directly, Hero MotoCorp may now have a bigger say in this segment.
Q) Which of the following statements regarding Dedicated freight corridors is correct?
- Dedicated freight corridors have been planned to ease the growing passenger and goods traffic on busy routes.
- The Eastern and the Western corridors will meet each other at Delhi.
- 1 only
- 2 only
- Both 1 & 2
- None of the above
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