Harley Davidson To Leave India – Burning Issues

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2007 DEAL

In 2007 India and U.S signed a deal where Indian mangos would get access to American markets in return for Harley Davidson’s entry into Indian market
Harley entered India in 2009 after an agreement between Washington and New Delhi that allowed American motorcycles to access the Indian market in exchange for Indian mango exports to the U.S.

In a swap deal, India had sent its freight of mouth-watering mangoes to the United States while allowing the importation of Harley Davidsonbikes with an engine capacity of 800 cc or above if they comply with Euro-III emission norms

India exported 615.53 metric tonnes of Alphonso mangoes to the US in 2016-17, from nil in 2007-08.
However, this is nowhere close to the 3,000 tonnes that were exported to the UK in the same period. During 2016-17, India exported a total of 50,000 tonnes of mangoes valued at Rs 420.36 crore.

Harley-Davidson Inc. is pulling out of India, another major setback to Prime Minister Narendra Modi’s efforts to lure or retain foreign manufacturers in the midst of the nation’s worst economic downturn in decades.

The company is “discontinuing its sales and manufacturing operations in India” and will lay off about 70 employees there, Harley disclosed in a filing to the U.S. Securities and Exchange Commission. Its plant in the city of Bawalwill close.
Harley had high hopes for an expansion in India as sales decline steadily at home. But the U.S. icon made limited inroads in a market dominated by lower-cost vehicles from local players like Hero as well as entrenched Japanese manufacturers such as Honda Motor and Suzuki Motor.

With its announcement Thursday, the Milwaukee-based company joins compatriot General Motors in leaving the Indian market behind despite the huge potential promised by the country’s population.

Harley reported selling a cumulative 25,000 motorcycles during its 10 years in India –less than what it shipped during the first three months of 2019 in the U.S.

Trump often cited the Narendra Modi-led government’s tariffs on Harley-Davidson as an example of why India is a “tariff king”. India did lower duties on the Milwaukee, Wisconsin-based motorcycle maker to 50 per cent in 2018 from around 100 per cent earlier, but the US President found the new tariff rate “still unacceptable”.