In an interview last week in Mumbai with Hindus And Times, Harley-Davidson President and COO Matthew Levatich and Harley-Davidson India Managing Director Anoop Prakash explained their strategy. Below are some edited excerpts.
Since it launched its Indian operations in 2009, Harley-Davidson has sold some 2,000 bikes in the country. Slowing economic growth hasn’t hurt demand for its products; customers need to wait three to four months to receive delivery after booking for most Harley models. Harley sells 13 models in India, of which six are locally assembled at a factory in Bawal, Haryana.
Q- Will we the company offering more models that are locally assembled? Any plans of making fresh investment in your facility in Haryana?
A- Levatich: We will continue to evaluate the possibilities on a model basis. For the time being, we continue to leverage the investment already made. It’s all about making sure that we read and support the market well. The completely knocked down (CKD) models make up…the majority of the sales because it’s a point of entry into the brand. You can say it’s a chicken and egg concept. People are buying CKD as we chose to do it and vice versa.
Q- Is Harley looking at developing an India-specific motorcycle?
A- Levatich: Product development is a significant investment for any company and our strategy is not to develop any market-specific motorcycles. We don’t have any in our portfolio today and we don’t have any plans to. However, when we decided to enter the Indian market and going through the planning process, we started incorporating new answers about the market into product planning, which is a long-term process, which addresses the needs of the Indian buyers, so that our models make sense for this market.
Q- Is your India strategy different from other markets?
A- Levatich: Whatever we stand for is common for all the markets and culture—the idea of personal freedom, of self-expression, of personalization, of making a statement regarding who you are as a person, is the same. There is a common theme shared by all Harley riders across the world. We stick to that theme because it’s very powerful. Our business model approach is the same in every market we are in.
Q- How has the market for premium motorcycles been expanding in India?
A- Prakash: We have seen a steady growth in the premium segment. It will go the premium car market way. When Mercedes came in, no one knew how big the market was. Now you can see the segment has so many brands; market for super luxury bikes would follow a similar trajectory. The fundamentals are strong. It will take a few years to say with conviction how the market is as it’s still shaping up. As an early mover, we are shaping it.
Q- You believe in the philosophy of creating silence. Can you elucidate?
A- Levatich: The idea of creating silence is—if the right work is done in a right way, it is implemented seamlessly without drama, without strife, without noise. So, the good person doing good work in a good way creates silence by virtue of that work. Squeaky noise is created by someone not quite doing a good job and usually management attention goes to the noise and I don’t want any noise. Just a good job done in a good way and silence. Another way of putting it is—if you reduce the noise, you can create more headroom for the sound, and sound is good.
Q- How do you plan to leverage the 110 year global celebration of brand Harley in India?
A- Levatich: It’s a big milestone for us. The first global celebration is happening at Goa in the months of January and February. We are promoting some 110 events globally as it’s (the club of Harley owners) a global community. The one in Goa is one of them. It’s a big deal. We expect 500-plus owners riding from all over the country into Goa. This will include four days of celebrations—celebrating the bike culture.
Q- What percentage of your total sales are financed? Any plans of launching your captive finance arm in India?
A- Prakash: It’s a healthy proportion. We have partnerships with ICICI Bank Ltd and HDFC Bank Ltd. They are offering very competitive rates. Launching the captive arm depends on the maturity and scale of the market, but we remain open and are keenly watching what others are doing in the space.
Wonder if India made bikes will be sold in the USA someday?
@Rodent, I doubt it. I think, and I may be incorrect, so somebody please let me know otherwise, but I think this works because HD can ship the unassembled engines and motorcycle parts to India at far lower import duty rates than they can by shipping a complete engine or bike. I believe that is where the local assembly becomes a financial asset.
Conversely, complete bikes or engines built in India would likely face a similar import tax coming into the United States which would eliminate the savings.
Rodent Jan 23rd, 2013 at 10:12 am
Wonder if India made bikes will be sold in the USA someday
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Only if there manufactured without noise so as to hear the sound. Would that be a silent Harley. Hmm
Chris
I think, and I may be incorrect
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Interesting theory Chris. Two hours ago I was in an Royal Enfield show room / boat sales.
New bikes on floor for around. $ 6.000 and less.
My point. How stiff can these tariffs be that you point out ?
The bikes sound / noise and look like a great buy.
Could or would HD ever build a bike at this price and never leave the country.
Rumor has it that HD is bringing in people from india to build bikes for our market at a price point. you heard it here first.
Looks like Steve Martin sitting on the bike… guess it’s 2 wild and crazy guys on the loose in India.
Dearest of sirs.
Regarding repair of my motor cycle.
Please do the needful and I will do the same.
(very few will get this, but those who do, will probably laugh their ass off!)
Indian made bikes already sell in the US of A and have been for a couple of years now, Royal Enfield! Made at home here in Chennai.
India ???? Why not…. Harley has been using cheaper Asian parts for many years. Maybe they should secure the naming rights for an Indian “INDIAN” for production over there before someone else does……..The great American Motorcycle has been multicultural for ages. Assembled in the USA not Manufactured in the USA.
Their approach is the same in every market. Convince guys that covering themselves in HD logo’d T’s, jackets, bandanna’s, fingerless gloves, boots, belt buckles, and more so they all look alike…somehow makes them an individual that stands out.
And, they don’t need to make the bikes in India when they can just replace American workers with Indian immigrants right here in Milwaukee. They already did it to the IT department, no reason not to do it on the factory floor next.
Of course their approach is the same in every market: they sell “un-finished” motorcycles to customers and falsely tell them they: “have to have their bike services at the dealership using only HD parts to retain their warranty”. The difference is that they are now selling them to brown people too!
Steelchoppim well said and if you rode or looked closely at 2 royal Enfield you would save another $1500 and buy a Sportster or a great, Cafe Bike. Royal Enfield Trash! Boys is it time to send a lot of Used Bikes and have all the Hindu’s waiting for a new Bike, step right in to a Used Bike???????