Harley-Davidson plans shutting down India operations: Report

Harley-Davidson plans shutting down India operations: Report

United States based premium bike maker Harley-Davidson is planning to shut down its assembly operations in India, according to a report published in The Hindu.

According to the report, the company had sent feelers to a few automakers for an outsourcing arrangement using its leased assembly facility at Bawal in Haryana.

Harley has been struggling for years to grow sales beyond baby boomers. The company has not posted retail sales growth in the United States, its biggest market, in the past 14 quarters. In India, Harley-Davidson sold fewer than 2,500 units in the last financial year.

The company also unveiled a restructuring strategy that aims to shift focus back to more profitable motorcycles and core markets such as the United States.

Chief Executive Jochen Zeitz has tightened supplies and cut production, reducing global dealer inventory and driving up prices for pre-owned bikes, which used to be a drag on new bike sales.

Zeitz, who took the reins in February, said the company will avoid price discounts and promotions to drive sales. "Focusing on desirability will be the future," he said.

The move could make it tougher to find new customers in the worst recession since the Great Depression.

As part of the restructuring strategy, Zeitz plans to reduce product portfolio by 30% and invest in 50 markets with growth potential in North America, Europe and parts of Asia Pacific.

His strategy will eliminate 700 positions, but is estimated to result in ongoing annual savings of about $100 million.

(With inputs from Reuters)

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