From pushing USD 150 million liquidity to bringing in the lower displacement bikes like 338R and stripping its portfolio.
Harley is trying to revamp and change the perception of buyers.
Hero Motor Corp
However, for India, we think it’s late as Harley is all set to pack their bags now it doesn’t sound like an end.
As we are also informed about Harley scouting a strategic alliance with Indian motorcycle manufacturers.
And the most prominent name among them is Hero Motor Corp. While the rumours are not new.
Earlier Pawan Munjal, chairman at Hero MotoCorp, had told Business Standard “We are open to all kinds of partnerships. Whenever there is a good match available, we will certainly evaluate”.
Impact
Now Harley shutting its shop in India means 70 employees will lose jobs. However, Harley will retain sales office present in Gurugram.
To look after the emerging Asian market we also see the managing director of India, Sanjeev Rajasekharan is now posted in Singapore.
Harley has just sold 27,000 bikes in the last decade which is half when compared to Royal Enfield.
100 motorcycles were sold in the first quarter of the current financial year.
With sales tumbling, we saw a new CEO, Jochen Zeitz taking hold of the Harley. And he showed good results by stripping 30 per cent of its portfolio and pushed funds in 50 markets across the globe.
On the verge of $169 million to motivate more sales Zeitz made new ambitious restructuring strategy ‘ Rewire ‘.
Here is the breakup of the restructuring cost
- Is %75 million
- $3 million in termination profits.
- $5 million in adjustments of the non-current asset plus
- $67 million in termination of contracts and other costs.
For local sales, Harley does have a manufacturing plant in Haryana where we see the CKD motorcycles.
However, on the other end, we also see the Harley does import motorcycles via CBU route with 50 per cent high import duty.
Also, don’t be surprised there is GMC Harley Davidson 2020 truck whose wheels are modelled after the Harley Fat Boy motorcycle wheels.
Notably in India, it will be exciting to see how Harley pushes itself after the strategic alliance.
Source: Business Standard
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