- Harley Davidson is an American motorcycle company founded in 1903. It entered the Indian market in 2010 by importing bikes as Completely Built Units (CBU) and faced high import duties. - To reduce costs and duties, Harley opened an assembly unit in India in 2014. They aimed to build their brand image through customization and a strong dealer network rather than compete for market share. - While the Indian motorcycle market was growing rapidly, the luxury bike segment including Harley remained small due to customers being price conscious. However, rising incomes and disposable wealth were increasing demand for leisure purchases like Harley motorcycles.

1. Submitted by:
Tushar Singh
Niharika Singh Thakur
Rishabh Vijayvargia
Karan Shah

2. Introduction:
• Harley Davidson is an US based motorcycle giant found by William S
Harley and Arthur Davidson in the year 1903.
• It is headquartered in Milwaukee, Wisconsin, United States.
• Japan was the first country to whom it started exporting its bikes in
1912.
• Japan was accountable for 5% annual global revenue by 2012.
• It started venturing into India in July2010.
• They were aiming to earn 40% of their revenue by exporting bikes to
other countries.
• India being the 2nd largest market in motorcycle segment gave Harley
scope for development and penetration into the market.

3. Harley Davidson in U.S:
• The US Military used to purchase around 50% of the bikes
manufactured by Harley.
• These motorcycles were fondly called as Beasts. “Fat boy” being the
most popular among all.
• It created groups for Harley owners by the name Harley Owner’s
Group (H.O.G) being the most common of them, which also became
the company funded largest motorcycle club.
• The motorcycle market grew @9% in U.S. Whereas the demand for
Harley was up by 14%.
• People were willing to pay 25% more to get speed delivery.
• Competitors emerged in the market. Such as Honda, BMW, Ducati,
Yamaha, KTM.

4. Harley Davidson in U.S:
Harley Davidson, U.S (2001)
Motorcycle and
Related Products
(MRP)
Financial
Services (FS)
• Produced and sold heavy
motorcycles
• Parts
• Accessories
• Related Merchandise
• Wholesale retail financing
• Insurance
• (For dealers and retail
customers)

5. Sales and Revenue:
• In 2012 the annual revenue increased by 35.3% as compared to the
previous year.
• The international sales increased from 25% in 2007 to 34.7% in
2011.
• Planned to increase its international dealer network by 100 to 150
dealers in 2014.
• To make its presence felt in Asia Pacific region they came with a
headquarter in Singapore and an assembling unit in India.
• There were around 1400 HOG in U.S. The bikes were referred to as
“a mean machine”, “a scorcher on road” or “a dream cruiser”.
• It was considered as a lifestyle brand and its customers were brand
loyal.

6. Harley Davidson in India:
• India was considered as one of the fastest growing motorcycle market
and to take advantage of the same Harley entered in the Indian
market in 2005 through direct import route.
• The government’s emission control norms for the bikes above 500cc
could not qualify for it and hence its sale was effected for 2 years.
• In 2007, high import duties were levied upon the bikes.
• The tariff was 60% the price of the motorcycle and a 30% TAX
making its cost almost double as compared to U.S.
• Tariff Rate Quota (TRQ): a plan proposed by govt wherein the
custom duty would be reduced on a fixed number of imports. But
could not be implemented as other companies would ask for the same.

7. Harley Davidson in India:
• 2 way route was proposed by Indian Govt whereby for import of bikes
into India US would have to allow the import of Indian mangoes and
provide licenses for Indian banks.
• In 2008, Euro 3 emission standards was accepted by the Indian govt
and allowed for the import of the Beast in exchange of import of
Indian Mangoes in US but the custom duties did not change.
• To oppose the govt’s rules and policies Harley organised a rally in
Delhi in 2009 which was not successful.
• Harley could not sell its bike directly to individuals but could do so
only by a dealer network.
• The company was facing a decline in its sales in US.

8. Harley Davidson in India:
• Close to 100 applications were received for the dealership of Harley
in 2009.
• In August 2009, the company started importing its bikes as
Completely Built Units (CBU).
• The first showroom came up in Hyderabad in July 2010.
• To compete with the other brands they localized their functioning by
setting up an assembly unit in India, which also helped in reducing
the custom duty.
• After setting up an assembly unit, the prices of the bikes came down
by 25% to 30%.
• Out of 15 models sold in India, 5 were assembled here itself.

9. Harley Davidson Strategy for India:
• India though being largest market for motorcycles, the people are price
conscious and did not spend much on luxurious bikes and the market
for Harley was very small.
• People who bought searched for the “Made in US” tag.
• The company sold through its strong dealer network nationwide and
imported bikes from US as Completely Built Units (CBU).
• 5 dealers were appointed in March 2010 in Delhi, Mumbai, Bangalore,
Chandigarh and Hyderabad who acted as the retailers for Harley and
provided customers with the same experience and service as any Harley
store in US.
• Major competitors: BMW, Kawasaki, Hyosong, KTM. Huge price
difference at the entry level segment.

10. Harley Davidson Strategy for India:
• The company’s objective was not to compete for market share but
to build its brand image among people by finding out the right
dealers for penetration.
• They came with customization kits for Indian customers which
allowed them to design their motorcycles themselves.
• Apart from selling bikes they also sold personal accessories, clothing
and tattoos which they believed would paly a key role in their
success in India.
• Allowed test drive of all models and collaborated with HDFC bank
to provide financial help to fulfil customers dream.
• A lot of demand was coming from smaller towns and cities. The
company plans to open a manufacturing plant in the country.

11. Harley Davidson-Indian Perspective:
• The motorcycle market was growing at a high rate. Around 8Million
bikes were sold in April to Nov2010.
• Only a few 100+ Harley’s were sold. But that accounted for a
significant increase as the price range is very high for Indian
customers.
• The Indian economy is growing @10% annually. With the increasing
population of youth and more of disposable income, the buying
power has increased.
• People in India are slowly moving towards buying of leisure
products.
• Though 100% of the bikes sold belong to economy class, but the
market is taking a turn as the number of millionaires are increasing.

12. Harley Davidson-Indian Perspective:
• People in the age group of 25-65 were inclined towards Harley as
much as they were towards luxurious cars.
• Small towns like Guwahati, Bhubaneshwar, Lucknow, Bellary and
Indore saw an increase in the number of Harleys.
• Retail and service outlets of leading brands were set up in these
towns to cater to needs of the customers.
• Heavy motorbikes also calls for heavy maintenance. The spare parts
were discrete and not available locally. They were priced very high.
• The Indian roads did not suit the bike.
• Tough the period of 2010-2012 saw a dip in the economy, the
demand for luxurious product remained high. This made Harley to
double their sales target for 2012.