[payeng]

Originally Posted by bj96

There are about 30k Harleys in India. With average service cost of 10k/service (actually it will be more) it is about 30-40 Cr market annually (just the service) plus add parts and other services like RSA etc.

It will be a good niche business to run, I think.

-BJ

There is a Small Problem with such a Business: GROWTH

[wheeledwanderer]

Just saw this..

https://www.business-standard.com/ar...2500779_1.html

[ishan12]

The absolute blame for HDs fall is on HD themselves.
I find the logic absolutely absurd that the government and policies in India are to be blamed for a company that is struggling globally. I totally agree that we are not doing great yet in terms of ease of doing business, our taxes on purchase/manufacture/ import of high end cars/ motorcycles are way too high and they are very much still taxed as sin goods. I hope we soon come out of the socialist hangover and move towards a consumption driven economy.
Add to that our frequently changing policies.
But lets not forget that around the same time HD fell flat, companies like Kawasaki, Suzuki, Triumph, Honda have been selling their larger motorcycles rather well and they have the same hurdles in terms of policies etc. that HD has.

Did we blame the government for Kodak, Micromax, Nokia, Kinetic, LML, GM, Opel??
Truth is, you can not take your customer for granted, in India or anywhere in the world. If they don't find it worth their money, they wont buy it. Simple.

If compared to HD, KTM did not enjoy any brand recognition in India when they arrived. Look where they are now. They came with good products, well localized, well priced and backed by good service in a segment that did not exist at all, and see how well have they done!

HD never really tried to localize their offering or even study the market and offer what would sell. You can not just throw in your 1800cc humongous dinosaur of a motorcycle in India that sells well in the US and expect people to buy it at an absurdly high price just because you are "Harley Davidson".
Even the Street 750 was a half hearted attempt with shoddy brakes, MRF tyres and the street presence of an Avenger (Gem of an engine though). Hope they have learnt their lesson and come back with something worth the price they charge.

[low_rider]

It's always easy to blame the Govt. Reality which HD was aware even before entering the market is that there are a miniscule percentage of Indians that are "able" and "willing" to buy a bike for 8 lakh+ rupees.

No matter how much you drool over the machines, the brotherhood, rides, but paying 10 lakhs for a bike is a big big thing. In these last 10 years those who could purchase had purchased HD bikes and the market saturated. There is no room for growth.

Coming to Govt, even if they give a special tax rebate of 30% on HD bikes, what will happen? A guy who can't afford a 10 lakh bike won't be able to afford a 7 lakh bike either.

Talking about other "world-class" companies, which world-class product did they bring to India? Ford had launched some good products and tasted success but what after that? Figo and Ecosport were hot selling models, but you can't keep milking them for ever.

Talking about "understanding of Indian market", they are very fast to understand the non-existent customer protection framework in India, which they fully leverage in case of any customer issue. Did any foreign manufacturer provide same level of customer protection as they provide in their home countries? Does the Govt stop them in providing customer service of EU or USA standards?

[MadinMumbai]

Originally Posted by low_rider

Talking about "understanding of Indian market", they are very fast to understand the non-existent customer protection framework in India, which they fully leverage in case of any customer issue. Did any foreign manufacturer provide same level of customer protection as they provide in their home countries? Does the Govt stop them in providing customer service of EU or USA standards?

Okay, this is not specific to HD or even automotive sector. But if you bear with me it will make sense to the auto scene in India.

Government policy goes a long way in how customer service is delivered.

Let me give you an example - about 15 years back my hard drive crashed. It was an expensive SCUSII Barracuda drive. Seagate got FEDEX (if I remember right) to pick up the drive and they sent a new drive as a replacement. The local service partner called me and told me that the drive could be picked up from their office. I had to pay Rs. 7500 as customs duty and octroi and state sales tax. Now Segate was replacing the disk totally free as it was under warranty. But the Government’s multiple levels of tax were still hitting me where it hurt. On it’s part Seagate had done everything right and I could hardly expect them to suffer (and pay idiotic taxes) because my government has created a hostile business in environment. Have you ever wondered why companies like Apple won’t extend worldwide warranty on iPhones? It’s not because they don’t like Indian customers. It is because our tax rules make it impossible for them to replace a part/phone without an endless loop of stupidity. The same applies to replacing a MacBook Pro. When mine went kaput in warranty they started to fix it. The Apple guy I was corresponding with in Singapore couldn’t understand why the Indian service centre wasn’t simply replacing it because that how they do it in the rest of the world.

If we expect service levels that foreign car firms provide to their customers in developed countries we have to ask our government to offer the same playing field rules. No company is in India for charity. It is silly to point fingers at car companies when the problem is with our own regulations.

As a country we have to decide if we want to be a perpetual Premier Padmini, Ambassador and now Maruti only country. We can keep finding faults with foreign companies but we will live with substandard products.

[aniketvu]

Originally Posted by MadinMumbai

But the Government’s multiple levels of tax were still hitting me where it hurt. On it’s part Seagate had done everything right and I could hardly expect them to suffer (and pay idiotic taxes) because my government has created a hostile business in environment. Have you ever wondered why companies like Apple won’t extend worldwide warranty on iPhones?

If we expect service levels that foreign car firms provide to their customers in developed countries we have to ask our government to offer the same playing field rules. No company is in India for charity. It is silly to point fingers at car companies when the problem is with our own regulations.

You know they wouldn't have to deal with these taxes if they didn't import the components, right? We want to encourage companies to manufacture here and create jobs and infrastructure. Imports are always going to be taxed whichever country in the world you look at. Do you really think that the iphones that apple manufactures in China and sells in USA dont have any duties levied on them? There were a ton of articles about how prices of iphones and so many other items will go up in the US because of the trade war between US and China and Trump putting in higher duties.

Nobody gives warranties for free. It is factored into the cost. I have had international warranties on my thinkpad in 2005 and I got all the service I needed without paying a single penny.

btw: apple offers the international warranty in India for iphones sometime now.

The point which most manufacturers seem to miss are that the Indian customer is both cost conscious and smart. Nobody today buys anything just because it has a label on it. Everyone evaluates the cost, preference and suitability and only then buys it. A lot of multinationals treat us as third world consumers who will buy anything they throw at us and think we will buy it just because of the brand. Unfortunately for them, we are exposed to global trends and reject what we dont like. This is the learning that global organisations have to take and sell things here. Companies like Hyundai and Samsung have learnt that lesson and grown. A lot of others havent.

[bj96]

Originally Posted by payeng

There is a Small Problem with such a Business: GROWTH

Point considered. Hence, I said niche market. Growth will come from cross selling RSA, home detailing and service and increase in the frequency of service (bikes age, will need more service) and cannibalise other similar brands- Triumph, Indian etc with word of mouth. It is not a mass market. It won't be a double digit CAGR either, but, enough for someone passionate out to create a boutique business and earn a living... probably difficult but not impossible.

Cheers,

-BJ

[MadinMumbai]

Originally Posted by aniketvu

A lot of multinationals treat us as third world consumers who will buy anything they throw at us and think we will buy it just because of the brand. Unfortunately for them, we are exposed to global trends and reject what we dont like. This is the learning that global organisations have to take and sell things here. Companies like Hyundai and Samsung have learnt that lesson and grown. A lot of others havent.

Nobody is denying the failings of international companies and their difference of standards for underdeveloped markets. I am suggesting that instead of only pointing the lens outwards we, Indians, learn to accept our own failings.

Wishing for global manufacturing hubs, while a highly desirable dream, is not going to make them magically appear. Economics sometimes needs one to think counterintuitively. These manufacturing hubs will happen with the right incentives. Incentives are often confused with protection that appears as usurious import duties, cess, CVDs and a whole host of other charmingly named line items on an invoice. All that does is stifle legitimate trade. Sure every country has some form of import duties. India’s rates, unfortunately make manufacturing in India more expensive, defeating the very purpose they are supposedly there for. That’s why we are, after 65-70 years of protectionism and push to self sufficiency, still searching for Atamanirbharta.

[NiInJa]

Government's policies aside, there are two types of bike manufacturers trying to sell their products here in India

Type 1 : Selling international products at high price. These products are not localized for various reasons. Most components are imported. In such cases, after sales service can either be a hit or a miss.

Type 2 : Selling products which are 'Indianised'. They have heavy localization, thus getting cost benefits. Since components are locally available, after sales service can be cheaper, though it wont guarantee a good service. e.g. KTM, Husqvarna, TVS/BMW (Kawasaki, Honda have plans to manufacture higher capacity bikes in India)

Harley Davidson falls in the first category. They did have good sales run initially but their service was not great for the price of products they offered. Add to that the Japanese bikes are much better.

I wish they partnered with an Indian company right from the beginning and got serious about selling bikes at a relatively 'reasonable' price by making India a manufacturing hub. They would have survived in the long run here as the brand pull was immense.

Type 2 are those companies who thrive in the long run. Companies like TVS, KTM, Royal Enfield, Honda etc. all are moving higher and higher in their product range by increasing local content. You will notice that they have all one thing in common: They all are ready to make tweaks to their products to fit the Indian context. Be it localization to reduce costs or making India specific changes to the product. They've also shown a great deal of patience. In summary: extremely serious about Indian market.

[DrCar]

The real reason why I feel Harley couldn't succeed well in India because most of the Harley models resembles each other in looks and road presence. If you have seen one Harley then it is enough for you to not give a second look at another Harley models. For a non-enthusiast, it doesn't create good enough impression to consider them in future.

Whereas makers like Honda, Kawasaki, BMW, etc. have wide spectrum of models in terms of looks and engine options. So, they provide uniqueness to each and every buyer who opt for their models.

On a funny note, the real reason why Harley left India is because they were sure that they won't be able to compete with models like this.

[RMN]

Originally Posted by Starfire

As a Harley owner and loyalist, I feel betrayed. It takes years to build relations, but just a few seconds to destroy them.

But the writing was on the wall...for a long time, right? Hasn't HD been struggling for a long time now? They never revamped their line ups, got left behind and India operations were always at risk. And if history is anything to go by, none of these companies that shut shop did anything significant for their existing owners.

I guess my point is, it was a long time coming and their customers should have either expected it or never invested in them.

And this is coming from a FORD owner who is confused every year if I need to renew my extended warranty, cause there is no guarantee that FORD would be around to honor it

[Starfire]

Originally Posted by RMN

I guess my point is, it was a long time coming and their customers should have either expected it or never invested in them.

By that logic, customers shouldn't be investing their money in half of the foreign companies in India. Not with this global recession going in where everyone is facing heavy losses.

While going through a rough patch is normal, heck the entire automotive industry is burning, but that's where foresight, strategic planning, localisation and partnerships come into play. I'm not an MBA, but this is the universal fallback strategy of any large scale business that's going through tough times.

There are many smaller companies that Harley that are hit worst but are still turning their tides around. Shutting shop is not called for, even though its the smart (cowards) way out.
Anyway, not the end of the world, but surely a lesson learnt for life (from a credulous consumer point of view).

[navin_v8]

What a sad day for a motorcycling enthusiast like me this news has been. Harley Davidson entered India with a lot of oomph and attitude. Coming down the bell curve so soon for Harley Davidson was expected due to rising costs, taxes, global recession, Covid-19, etc. They are struggling in their home market as well. Everytime they tried to revamp (Porsche derived liquid cooled nightrod series engines, electric engine livewire, etc.) there was a massive backlash from HD loyalists akin to when RE launched the AVL 5 speed in late 90's.

HD's market shrunk as it's target buyers started getting old. I sincerely feel HD should start looking at other engine configurations (barring single cylinders) other than v-twin to appeal to a broader audience. It will be painful but change is the only constant if it wants to survive and thrive. Adventure Motorcycles are a good option for HD alongwith sub 800cc retro classics.

I've said it before and will reiterate again, I want the grand old American MoCo to survive. As someone said, these motorcycles are solid steel and built to last. Hoping that when the tide turns Harley Davidson comes back to India. Always wanted to own a piece of the iconic Milwaukee steel horse.

[payeng]

Harley Davidson-Hero MotoCorp likely to sign distribution deal this month: Report


Source: MoneyControl

[RMN]

Originally Posted by Starfire

By that logic, customers shouldn't be investing their money in half of the foreign companies in India. Not with this global recession going in where everyone is facing heavy losses.

But HD's/Fords struggle pre-dates COVID and has to do more with their working & management than the market itself.