Harley Davidson is beginning the next logical step in the international motorcycle market place, announcing they’re considering an assembly plant in India. Ever since they first began talking about sales in India, this was, to my mind, a foregone conclusion since tariffs in India double the price of imported bikes. Selling in India means making them there.
The company would consider taking that step as Indian sales increase, said Rod Copes, Harley-Davidson’s senior vice president of international sales, marketing and business development.
Harley also would consider manufacturing motorcycles in other countries for those markets, a step beyond assembling imported parts into completed bikes.
… “Getting the tariff reduced would be ideal. But we have not seen action on that yet,” Copes said.
With 32 percent of Harley’s sales outside of the U.S., figuring out how to best get a firm foothold in other countries will be an ongoing process.
I hope their experience doesn’t parallel Royal Enfield. They began assembling motorcycles in India back in the mid 1950s, then making parts, then the entire bike. Finally, the British company went under and India is now the only place Royal Enfields are still manufactured.
International sales are an important component of any company’s long term growth and right now, international sales are rising. If you have to build there to sell there, then you build there.
The intention is, as quoted above, “manufacturing motorcycles in other countries for those markets.” Will motorcycles built there ever be sent back to the U.S.? It’s very common in the auto industry and to think no one inside the Motor Company has ever asked that question or considered it for sometime in the future would be naieve.
Harley’s strong identity and carefully crafted image as an American motorcycle company, generates some sales on that fact alone for a segment of their market. If you begin building motorcycles in other countries, those sales are put in jeopardy and you now become just another motorcycle company, competing with every other company out there. Then the questions become, “What makes a Harley Davidson better or unique?” Is it style? Quality? Performance? There’s no right or wrong here but you can’t lean on the American image and build everywhere else. All of the other companies are building in multiple locations and bikes are compared straight up. A Honda isn’t given points as a Japanese bike since they are built in other places. Triumph isn’t British, either, it’s Triumph, for the same reasons. When Harley begins to sever the American manufacturing ties, they enter a new world, and it may be inevitable. How it works for them will be interesting to watch.
One further thought: I left out “lifestyle” as what might make Harley unique. Will that translate worldwide when the bikes are built worldwide? Does the lifestyle require a Harley? Things to think about that make you go hmm …
Will13 says
To produce outside the US is nothing new for the Motor Company, as most of their accessory parts (covers, caps, etc…) are already made elsewhere. Forks on an HD product have been provided by Japanese firms for nearly 30 years. Recently I spoke to a Victory dealer that showed me parts content of a Victory is nearly 80% US versus HD’s 60%. Yet HD still continues to outsell the Victory brand, which shows that people are not paying attention to were the components are sourced, just were the final assembly point is geographically located, and more so the name on the tank.
I think that as long as the management in Milwaukee doesn’t become too greedy, it will work out fine, provided the motorcycles the company builds for the American domestic market continue to be assembled here in the USA. However, should they begin to import from the Indian factory, it will most certainly be a case of brand suicide.
Tinman says
Will13, Well said. No company can compete against the slave wages in many foreign markets. Harley is talking about a possible assembley plant in India, not a manufacturing plant. The question remains why do we allow free access to our markets ? When others protect their home industries and often subsidise their preditory practices… On the Lifestyle question, Yes it is the “lifestyle”that sells HDs all around the world, it seems every country has a group of would be pirates waiting to come out of their shell. Many in the US make fun of Harleys, but the brand is Iconic in the rest of the world, notably Japan.
TVs Hasselhoff says
Why should this be a concern. Harley offers an image of American muscle, American freedom, and the bike design is uniquely American. It’s marketing, not parts content. They can build overseas and offer a competitive price in that particular market, not just selling a foreign build in America. This is the same thinking behind BMW and Mercedes building and selling in America. The Germans wanted to build their most popular North American vehicles in the US without getting hit with tariffs, taxes, etc., plus take advantage of the lower US wages than those of Europe. Yet, no one in America avoids buying German cars (mainly the SUVs) because they are built in America. Americans don’t see the Mercedes ML or BMW X3 and X5 as “American” vehicles. They see them as “German” vehicles. Harley can do the same overseas.
Scott says
If it was somebody other than Wandell at the helm, I wouldn’t be overly concerned, but with every new thing I hear from Wandell, I wonder more and more if he understands anything about the company.
Harley doesn’t sell bikes because they’re the highest quality, best performing, lowest cost bikes. They sell bikes based on image and heritage and they charge a premium for them.
If they throw that image and heritage out (as Wandell seems to be doing . . . either intentionally or not) what’s left? They seem to be trying to minimize cost at the expense of image and heritage. They may be able to cut their bike cost, but when they’re selling a bike that is indistinguishable from the competition, where will that leave them?
Random says
Free access to your markets? You must be kidding. Go figure ethanol import taxes. Corn-based ethanol gets huge help from your government, essentially preventing sugarcane ethanol (already up and running here in Brazil) being sold to your home market.
The main problem seems to be the exchange rate, not local wages. Everybody needs to eat, feed… wages are generally dictated be local demands, the government and manufacturers are the ones exploiting it.
As for Harleys, some of them are already assembled in Brazil at least, CKD (completely knocked down) process. Not that its parts come all from US, it seems. Didn’t seem to be affecting HD lifestyle allure, though.
Paulinator says
What kind of helmet laws do they have in India?
Dragonator says
This announcement on India is the same month Harley is in union negotiations, threatening to close its Milwaukee plant “and move it elsewhere”…
Richard Gozinya says
I don’t know, part of me says it’d be a bad move if those Harleys made in India start coming stateside, but the more cynical part of me says that Harley riders, by and large, won’t care. Made in the U.S.A. no longer means anything to most Americans, certainly it doesn’t engender any pride. Hasn’t for a long time now, for a variety of reasons. Personally, I’d like to see a system of reciprocal tariffs. Any tariff slapped on us by another country, we put the same tariffs on their goods. Yes, the WTO would cry about it, let them. We’re the world’s biggest importer, without us, quite a few countries would plunge into a depression. America might even get some more jobs out of it.
'37 Indian says
It baffles me to think that there may be an Indian Harley-Davidson.
Byrd says
“what makes a Harley unique”?
The ONLY thing they’ve had left since th Japanese started producing big inch V-twin wannabes, as that for the last 50 years, they’ve remained the only major motorcycle made in the USA.
I did like HD, but I have increasingly grown to absolutely loath the Motor Company over the years due to the inane, absurd re-branding, hideous styling, planned obsolescence creeping in (like getting rid of the trans trap door on sportsters for example), increased prices for flat black instead of chrome (or God forbid polished aluminum), and Beverly Hills marketing campaigns to convince people who shouldn’t even own motorcycles that they can be a “bad-ass” for $XXXXX.00
If HD does this move, stick a fork in them. The ONLY thing that has kept those idiots afloat since the early 70’s, was their recognition based on an image of the hard-core custom bike builder/rider they slightly smartened up for a while and stopped bashing. They will obviously open new markets if they turn to the third-world for quasi-slave labor, but the price they will pay with be a back-lash among a core group of bikers which they’ve leaned on, stolen from, ignored, insulted, and taken for granted for years on end as well-water to launch their bloated pathetic facsimiles of “custom bikes” . The Japanese have actually done that far, far better if “custom” imitation is the attraction, and HD is going to find this out in short order. Any chance of HD ever recovering their so-called mystique will abruptly and immediately end the day they make this final move. You won’t see the effects for years, but the “buy American” biker, and the serious builder-riders who’ve provided HD with all their ideas over the years, are going to find this absolutely treasonous and unforgivable. I know I do. Employing my countrymen was ONLY thing HD had left in a claim to justify it’s continued existence with an identity as far as I’m concerned. They over-reached deeply into yuppieville for a market share, and any acceptance they’ve maintained among the people who actually created the image they marketed, has only been maintained on their loyalty to using American workers. The Motor Company can rot in hell now as far as I’m concerned. They may think I don’t have a choice if “every thing” is made off shore by little brown people willing to suffer their abuses and exploitation just to eat. Oh yeah? I sure do have a choice, and I’ll make a point of it never being another HD or even HD based product if they do this, and so will others. It may not be the yuppie hords, but let’s see what happens to their mystique when the uncredited inspiration for their product line abandons HD’s as build platforms. Always wanted to build a KZ1000 engined chopper. Or maybe I’ll hack up an old 1400 Intruder. See ya Willy G! Maybe once this happens, we can restore the ability to discern a real biker from a week-end pretender without having to take a second look. Maybe you won’t meet the nicest people on a Honda any more.
Blaine Newell says
Hi there. There are still good 100% American iron goods. They are called Colt, Ruger, Smith and Wesson. And they hold there value very well during inflation periods. Blaine
Gazberzu says
Wouaw !
HD allready used to be at the top of technology, now they also will be crafted by the bests workers in the world !
I can’t wait to NOT buy one.
MikeyA says
India already has its own “Harley,” the Enfield Bullet, which I understand has the same iconic status over there that HD’s have in the States. Apparently, as India is getting wealthier, the richer bike buyers want Harleys, now, so setting up an assembly plant over there would make sense.
Just one thing. I have friends who’ve bought Enfields in India to ride all over the country on vacation, and one of the good points about the older ones (until the latest Rotax-designed electric start fuel-injected versions for the European market came out) was with their simple 50’s technology, which meant you could rebuild the top end on a rocky trail in the middle of nowhere, since you are unlikely to find a motorcycle shop in India outside a major city. Since I imagine Harley won’t be building up a huge dealer network throughout Asia that fast, just what kind of bike would they be making and selling over there-I can’t quite picture fixing a flat on a full dress bagger at the side of a dirt road…
Ian says
I know this post is more about selling bikes in India, but this was surely an inevitability to import bikes to the US too. Sure everyone would like to play the patriot and buy a US made bike. In reality that plays a small part in the buying decision, some distance below price.
Check the number of posts on here where people baulk at the thought of paying more than $10k for a bike. Newsflash- you can’t have both. You want a nice bike for $5k, it ain’t going to be built by American wages. Something has to give,so they get built elsewhere, just like your TV.
People that frequent Kneeslider are enthusiasts who have an in depth interest of all surrounding their bikes. I would guess that the majority of HD buyers would be oblivious of the fact that they were built overseas as the HD marketing machine can skew that story. After all, how many people that still think all Triumphs are built in Britain and BMWs in Germany? Keep the top end flagship models at home and send the high volume Sportsters to India where they bring home higher margins. Just like Triumph building the classics in Thailand.
I think it’s a good move. These days we need to be realistic that we can’t have our cake and eat it. As long as they keep check on the quality, which HD should have the capacity to do, then most people won’t know the difference. I’d rather see HD do this and stay profitable.
I think this could be a good thing for Royal Enfield too. HDs are still going to be way more expensive than a Bullet but they will become more aspirational as they become more visible, promoting the cruising lifestyle that RE also plays on in India. There will be many that dream of owning the HD but go for the RE.
DaveO says
Harley has never been an innovator. This is one more example where they are behind the curve trying to catch up. I love my shovel, but Harleys are pretty much irrelevant in the motorcycle world these days. Making them in India is pretty much like opening a Hard Rock cafe there. Selling style not substance.
zipidachimp says
hell’s angels on an india built bike? haha, can’t wait to see this!!!!!
p.s. still want a 750 v-rod.
kim says
Next from Bollywood; ‘Ghandi With The Windi’, where two guys set out on locally produced Harleys and try to find India…
John Mav says
indian exported HD’s, understand it’s not happening, but if it were, I would imagine the lifestyle segment would be up for grabs around the world! with HD being no more ‘authentic’ or ‘perceived quality’ to an e.g. yamaha big-bore twin. Also considering the price vs technology difference HD would need to catch up on comapred with the other similar products on offer….not sure if the risk would be worth the dollars for HD to go down this path.
Although in terms of assembling HD’s in India, for India, great idea!! and the same goes for any other country which it would benefit the local workers and also their market (& reduce tariff costs). I’m in Australia, and I would love to see a HD assembled in Aus, would give me great pride in an ‘American Designed’ product being assembled in Australia. The product would lose no ‘street cred’, and if anything strengthen the products appeal …i know in Australia, in most cases, we like to support a brand that supports our country. Personally i would ride my Aussie assembled HD with great pride!
However I would not think exporting those bikes to another market woud be a good idea.
wade says
the Harley exposed! in this present economy, the so called “american” marquee has not been produced in the U.S all along. i have owned 7 bikes of this brand out of 24 to 28 bikes in my lifetime. 5 of those Harleys were brand new.an ever increasing component number of parts on this brand were in fact, produced “off shore” since before most of us were born. the mystic? haaa haaaa! spin the the wheel!
Sportster Mike says
@Paulinator
They don’t wear helmets in Goa I know – and it was 5 up on a scooter when I was there. Mum sitting side saddle on the back holding the baby, with the other kids between Mum and Dad!! (oh and there was a live pig being carried as well)
Roads were awful – just tarmac in the middle gravel on both sides – and the biggest vehicle has the right of way. Bikes were mostly 100cc rebranded Hondas and Yamahas, with the odd Enfield if you were rich and petrol was state subsidised at 60 p a litre
Not sure how Harleys will cope outside of the cities as its virtually offroad terrain
and no rules of the road –
WRXr says
Harley should do it.
For years foreign companies ahve been building plants in the US: Honda, BMW, M-B, etc. No reason an American company should ignore one of the largest, fastest growing markets on earth.
Did anyone in Japan say a Goldwing wasn’t a Honda when they were built in Marysville, Ohio? I doubt it.
Does anyone care about the foreign content in Harleys now? Not enough to stop putting money down apparently.
Do it. A brand is more than just where something is made…it’s the ethos with which it is made.
As an aside, I remember reading an interview with an Indian politician who talked about how Harley imports were part of a trade deal with the US. We would open the markets for Indian fruits (Mangos he said) and they would open up for American motorcycles.
He laughingly said he thinks India got the raw deal. He sees Hell’s Angels chapters popping up in Indian cities, but he doesn’t see US bike clubs snacking on many mangos. Like I said, he said it laughingly.
Tom says
How has moving production to Thailand affected Triumph?
Sales, market share and profits are up.
John S says
Indian manufactured Harleys sold stateside? Sure. Just don’t try to use the word metallurgy and India in the same sentence. Similarly I have a Kawasaki KLR manufactured in Thailand. Love the $5,000 price. Not so crazy about having replaced every fastener on the bike. When the subframe bolts break, and they will, the resulting crash can kill you.
Chris R says
We all know many components on the current models of HD have foreign origin. Having seen imported tooling and component failure, I too have a concern about safety more than consmetics. Considering the demands put on US suppliers to have the highest quality products and quality documentations to trace each component, I have concerns that this will be put by the wayside by the corporate management for the sake of increasing profits. Have we not experienced some major quality issues from products imported from China? Would you bet your life on it?
Kenny says
You’re kidding about the quality thing right?
In europe, US brand cars are usually referred to in the same way as any cheap brand asian car like Kia or daewoo. Both in terms of quality and quality of design.
Paulinator says
Ya Kenny, How’s your Jag…I mean Ford…no wait, I mean Tata…I think?
By the time someone throws down enough mad-money to actually beat a Corvette on track day, he’s 200 000 euros light and he’s probably too short to see over the burl dash, anyway.
R says
So if it’s about where it’s manufactured and not content, why do I catch so much crap from HD riders about my Valk? It was BUILT in Ohio.. Oh yea, ignorance..
Vijay Yadav says
It will be very difficult to many an indian to buy US made HD. How can they(the mass) pay for two bikes for one? And for many an indian it will be very easy to afford HD manufactured in India.
And this is very silly to stich with the idea of heritage. Royal Enfield’s sale in India suddenly increased after the Eicher chief came out of his drowsyness to maintain the same design (not of bike but engine). The bike became an attraction for youngesters when it was lashed with disc btakes, electric start and above all the gear paddle was fixed on LHS; when the gear was simplified instead of that almost home made iron JUGAD.
Even for HD in mant people in US itself are losing their interest. they want to go for Honda or yamaha. In one of the blog I read “Harleys are the yesterday’s technology in tomarrow’s price.”
On the heritage issue I again want to say that Royal Enfield had not lost its image of a Royal Bike (In india atleast) and the oldest surviving motorcycle company in the world. Yes it would have lost if they were get ready to be flexibe for the hour.
The idea of India made Harley Davidson is only great and practical.
Shaleen Mathur says
Dont jump to conclusion, just test India made HD in US & then talk as much. India made cars doing great business in Europe, Latin America & we only look forward.
Vijay Yadav says
HI
So its 2nd Nov. and its a very pleasing news for me that now I can buy harley soon for it will be affordale for me now. Hope the sporster model will be around Rs. 3.5 lacks now instead of heavy Rs 695000. It will start from the 1st half of 2011. The palnt will be in Bawal, Haryana.
Thanks for this step to harley davidson. Now bye bye to Royal enfield’s single piston engines.
vinod kumar says
i want work with the same india