Harley likely to continue distribution in India

Harley-Davidson, a few days back decided to end its sale and manufacturing operations, is now expected to seal a distribution agreement with Hero MotoCorp this week, industry sources told CNBC-TV18.

Harley-Davidson is now keen to conclude a distribution agreement for India by end of October, to give transition time to the new distribution partner. Sources mentioned, Harley Davidson is partnering with Hero MotoCorp to finalize a distribution arrangement for India. Under this contract, Hero MotoCorp would be the exclusive distributor for Harley Davidson bikes imported into India from Thailand.

Industry sources stated that For Hero MotoCorp, the primary concern is to identify a collaboration that allows the sharing of technology for a middle weight motorcycle. Justification to the reason behind negotiations between the two companies has been on for months are because Hero MotoCorp wanted more than just a distribution partnership.

Sources have further maintained that the immediate deal would focus only on distribution and managing Harley’s 33 outlets in India. “Harley Davidson is looking at all models to maintain a presence in India. Harley may be open to a technology-sharing pact or contract manufacturing with Hero at a later date”.

The company wants to assuage the concerns of dealers and the rider community in India. The company had already informed dealers that the company would renew service contracts in case a distribution model is not finalized by the year-end.

Dealers of Harley Davidson have been worried about unsold inventory, investments into setting up state of the art showrooms and their employees. Some have even been considering legal options to put pressure on the company. At the same time, the company has been receiving a lot of queries from customers about Harley’s future operations in India, and whether Harley’s new global launch, Pan America would come to India as well. “Since Harley announced an India exit I have sold only 3-4 bikes. There is a lot of uncertainty and people don’t know what is going to happen to the company. Hope the company clears the air soon”.

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