A Harley-Davidson outlet and workshop in Mumbai. In 2014, Gaurav Gulati, a longtime Harley rider, was enticed by Harley-Davidson's managing director in India to open a dealership in New Delhi. By the time his outlet opened two years later, two of the company's bosses in India had come and gone. Harley-Davidson, the proudly American company, is giving up on India because of weak sales, after more than a decade of pursuing a huge but ultimately frustrating place to do business.
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"It's all over now," said Singh, a service representative. "There are no bikes to sell anymore." It has set back Harley-Davidson's efforts to expand its popularity overseas. And it strands a small but devoted group of Harley devotees who are wondering how they will keep their prized rides rumbling.
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Preetam Thakoor, a Harley-Davidson owner, left, chats with other enthusiasts. Manufacturing contributes less to India's economic output than it did a decade ago. The government has struggled to build an ecosystem for manufacturers, including infrastructure and industrial parks. Small suppliers who might help a big manufacturer flesh out a supply chain have a hard time getting credit.
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Despite the difficulties, any foreign manufacturer interested in India has to explore setting up shop here. The country has some of the steepest trade barriers among the world's large nations.
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India dropped the tariffs on Harley motorcycles from 75% to 50% in 2018. Still, the government charges an additional 31% tax on two-wheelers, one of the highest in the world. Harley-Davidson decided to put bikes together inside the country. The Milwaukee-based company sent knockdown kits - packages of parts to be assembled - for low-powered models, like the Street 750, to its factory outside New Delhi.
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Harley-Davidson enthusiasts from around Mumbai at the end of a group ride to Palghar. | The signature, higher-end motorcycles were still being shipped from the United States. But sales dropped after an initial surge, and the India operation suffered from executive turnover. Harley-Davidson sold a total of 2,470 bikes in India in the 12 months that ended in March, almost half the number it reached five years ago, according to the Society of Indian Automobile Manufacturers, a nonprofit representing automotive manufacturers.
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The company's motorcycles also remained out of reach for many. Harley's top model exceeds $88,000 in Delhi after taxes and licensing fees. That is 41 times India's average yearly income, according to the World Bank.
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A motorcycle awaits servicing at a Harley-Davidson outlet in New Delhi. The Harley name will not disappear from India entirely. The company said last month that it struck a deal to "sell and service" its motorcycles through Hero, the local company, which it said would also "develop and sell" motorcycles under the Harley brand. With the closure of its own factory, the fate of the Street 750, Harley's most-popular bike in India, is not clear. Harley is also laying off about 70 workers.
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