from Lijee Philip from https://economictimes.indiatimes.com
Harley plans to hitch a ride with two-wheeler makers, Classic Legends, Hero Motocorp frontrunners
Mahindra’s Classic Legends could be the obvious choice for the iconic leisure bike making company as it aligns very well with M&M’s approach of catering to the premium end of the market with marquee brands , and for Harley, it gets a local company with a large manufacturing facility and an established local supply chain.
After its global restructuring efforts to make Thailand its main hub for Asia Pacific, Harley Davidson is now understood to be exploring potential collaborations with Indian two-wheeler makers. The two possible names doing the rounds are Mahindra NSE -0.82 %’ subsidiary Classic Legends and Hero Motocorp NSE -1.89 %.
The potential Indian alliance partners could do contract manufacturing for Harley Davidson in the mid-size motorcycle space – in line with Bajaj-KTM or TVS-BMW.
Mahindra’s Classic Legends could be the obvious choice for the iconic leisure bike making company as it aligns very well with M&M’s approach of catering to the premium end of the market with marquee brands , and for Harley, it gets a local company with a large manufacturing facility and an established local supply chain.
Classic Legends was established to re-introduce iconic marquee motorcycle brands in the market and currently retails the Jawa motorcycle brand also owns iconic brands like BSA & Yezdi.
While it started of with impressive sales numbers, delays in deliveries and quality issues makes it difficult for the company to meet the growing demand.
Hero Motocorp has stated that it’s open to partnerships to get a stronger foothold in the premium segment. Market leaders in entry level/commuter and the 125cc segments, it lacks premium bike building capability.
After several attempts, Hero has finally managed to break-into 200 cc segment with Xtreme, but bikes beyond 350 cc domain does not exist with the maker of Splendor, with Harley coming on board, the positioning would have been quite complementary in nature.
Harley-Davidson has been scouting for alliance partners in India with a manufacturing and distribution network to make lightweight motorcycles in the sub-500cc category. Under the new CEO, things are being reviewed again, say sources. ..
While the contours of the agreements are still being worked on, sources say it will be a non-equity partnership to make bikes targeting the small displacement category.
To a detailed email query , Harley Davidson, Mahindra ,Hero Motocorp and Royal Enfield said it does not comment on market speculation and rumours.
“On its own and with limited volumes, Harley will struggle to localise. By partnering with a local company, Harley will not only be able to shed fixed cost, but also accelerate sourcing with the help of the local partner. Over the last five years, the company has explored mid-size motorcycles for India and India like emerging markets. Its model developed in China has a potential to cater to the Indian market,” said one of the several people in the know of the company’s plans.
Earlier this year, Harley partnered with Chinese motorcycle maker, Zhejiang Qianjiang, mother company to Benelli, to launch Benelli 350 and the Harley-Davidson 338. Such kind of a smaller capacity motorcycle will be important for the Milwaukee cult brand which has been seeing slower sales in the country.
