After all of the recent reports of new agreements to allow motorcycles over 500cc to be imported into India which would allow Harley Davidson, among others, to enter the market, Harley has announced it will put an indefinite hold on plans to set up shop over there. The recent changes which ostensibly opened the market applied the Euro III emission standards to larger engines. Once that hurdle was cleared it looked like the Harleys were on their way.
Unfortunately, the one thing India did not change was their incredibly high 60% import duty and 30% tax, essentially doubling the price of the imported bikes. After examining the potential size of the market at that price it looks like Harley Davidson has decided not to enter the market after all. Average industrial import tariffs in India, by comparison, are about 10%.
India, and many other countries, keep import duties high to protect local business by keeping competitive products out. However, in India’s case, there is no domestic company producing anything like a Harley Davidson. Most Indian bikes are in the 100cc and 125cc range while Royal Enfield produces the largest Indian made motorcycle, the 500cc Bullet.
If India lowers import duties, the issue may be brought up again, but for now, the Hogs stay home. It will also be interesting to see if any of the other manufacturers considering the Indian market decide to follow through or, like Harley, put the brakes on their plans, too.