Harley Davidson said on Thursday announced that it would discontinue its sales and manufacturing operations in India, which is effectively abandoning the world’s biggest motorcycle after a decade of unsuccessful efforts in gaining a foothold.
Harley spent recent months moving dealerships to the country to cheaper locations, and the announcement followed speculation in Indian media a month ago that executives played down.
The move of $75 million in restructuring costs, and some 70 redundancies and closure of its Bawal plant, walking away from a market costing about 17 million bike and scooter sales a year. It will retain only a scale-down sales office in Gurgaon, south of New Delhi.
The departure is even also the latest setback for PM Narendra Modi’s strategy to encourage domestic manufacturing that would keep more fruits of a considerable home consumer market in India.
Harley has been scrambling to grow sales beyond baby boomers in the United States and has not posted sales growth there in the past 14 quarters.
CEO Jochen Zeitz, who took the company in February, unveiled a major “Rewire” in July to boost profits by reducing Harley’s production portfolio by 30% and investing 50 markets with potential growth market in North America, Europe and parts of Asia Pacific.
India was among one of the markets where the company at that point committed to investing more heavily. A statement of Thursday said the move to leave had been pushed through since 6 August.
Harley said it expects total restructuring costs of about $169 million in 2020, but warned that restructuring program which referred to internally as “The Rewire” – was likely to construct more charges.
India is still cheaper and more destitute than many of developing economies with which it competes for investment, which has proven an inhospitable market for other auto industry players.
