Founder Riders and Harley Executives at the India Gate
If you can’t sell everything you produce in one spot, move to a new location. That’s a basic business concept that works with mangos or multi-national corporations, and exactly what U.S. motorcycle icon Harley-Davidson is doing, assisted by new trade agreements between the two countries.
The Motor Company announced it was expanding its dealer network into India, establishing headquarters near Delhi and looking for dealers in Mumbai, Delhi, Bangalore, Hyderabad and Punjab State. Harley-Davidson’s Chief Operating Officer, Matthew Levatich spoke at the Society of Indian Automobile Manufacturers annual convention on August 28th after riding up to New Delhi’s India Gate on a rain-soaked Ultra Glide. “There is now a confluence of factors in India that is favorable for us,” the Washington Post reported him saying. “The rise of middle-class consumption, increased government investment in new highways and the recent economic boom have ushered in a perfect time for the market for leisure motorcycle riding.”
The Founders Ride rolls through Delhi’s torrential rain
That’s not just corporate spin. India’s economy is still booming despite the global recession: the GDP grew 6.1 percent in the first quarter of the fiscal year, the government is building 12 miles of highway a day, and the McKinsey Global Institute projects India’s middle class (estimated at 50 million in 2007) will be 583 million strong in 2025. All projections aside, if India’s population of over one billion was comprised of just 1/100th of one percent of folks who wanted and could afford a Harley, that’s a million motorcycles. But H-D isn’t hoping for that much success: a modest target of 100 per year by 2012 was mentioned in a UPI story. Not even a drop in India’s eight-million-motorcycle-a-year bucket.
But what do we get out of the deal? Aside from possibly stoking demand for other U.S.-made products (in case we still make anything here in the future), we might get 250,000 tons of mangos. That’s right: after an 18-year ban by the FDA, you will now be able to buy mangos from India. In return, the Indian government will allow Euro-III-compliant motorcycles 800cc and larger to be sold in India, although a 100-percent import duty will stay in place. That means the lowest-priced H-D model will be around $14,000. Pricey, but inexpensive for an automotive status symbol, even in a country where hundreds of millions of people earn less than a dollar a day.
So if you like Harley-Davidson (or own stock), buy Indian mangos; according to Indians, they’re supposed to be the best in the world.
MD Readers Respond:
- This is why it would have been so great for the off road aspect of
the sport if the Motor Company had gone through with their plans
to produce a dirt bike. We would have unlimited access to public
lands and never have to worry about future problems with availability
of riding areas. Heck, HD could probably have gotten the Fed’s to
reopen land that was previously shut down. I still hold out hope that
some day it will happen. Kevin - In return, the Indian government will allow Euro-III-compliant motorcycles 800cc and larger to be sold in India, although a 100-percent import duty will stay in place. That means the lowest-priced H-D model will be around $14,000. Pricey, but inexpensive for an automotive status symbol, even in a country where hundreds of millions of people earn less than a dollar a day. What brilliant head of state negotiated that 100% doody deal?
