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Harley-Davidson has decided to terminate its operations in India.
Harley-Davidson has decided to discontinue its manufacturing and sales operations in India, as part of the restructuring actions that the company calls “The Rewire” strategy. On Thursday, Harley-Davidson informed its employees of additional restructuring costs amounting to $ 75 million in 2020, including the discontinuation of the iconic American brand’s operations in India. The total costs associated with the ‘The Rewire’ strategy outlined by Jochen Zeitz, Harley-Davidson’s chairman, president and chief executive officer amounts to $ 169 million this year. The motorcycle brand expects to complete restructuring actions starting in August that will be completed in the next 12 months, which will include optimizing its global dealer network, exiting certain international markets and discontinuing its sales and manufacturing operations. in India. In India, Harley-Davidson will reduce the workforce by approximately 70 employees.
Read also: Harley-Davidson could leave India due to poor sales
Harley-Davidson CEO Jochen Zeitz has outlined ‘The Rewire’ strategy to focus on markets where there is potential growth, and India doesn’t seem to be on that list.
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In a statement to the U.S. Securities and Exchange Commission, Harley-Davidson outlined the development and added some details about restructuring costs.
“As a result of the actions approved from August 6, 2020 to September 23, 2020, the Company expects to incur restructuring expenses of approximately $ 75 million in 2020, of which approximately 80% are expected to be expenses. cash, including one-time termination, benefits of approximately $ 3 million, non-current asset adjustments of approximately $ 5 million, and contract termination and other costs of approximately $ 67 million. The full implementation of these Rewire actions may require the Company commits additional funds for additional contract termination and other costs. Restructuring charges previously disclosed, the Company expects total restructuring expenses associated with the approved Rewire restructuring actions through September 23, 2020 of approximately $ 169 million in 2020 . The Company expects to complete the approved restructuring activities until t on September 23, 2020 in the next 12 months. Announcements associated with additional shares in The Rewire are expected to occur, some of which will likely lead to additional restructuring charges, “the company said.
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Harley-Davidson’s big heavyweight cruisers didn’t get the answer in India in terms of volumes
Carandbike reached out to Harley-Davidson India for a statement confirming the development, but there has been no official response from the American motorcycle brand. Harley-Davidson has been under pressure in recent years, and the American motorcycle brand’s sales slowed in several markets around the world. And India seems to be one of those markets, where Harley-Davidson has been around since 2009, and where the first Harley dealership emerged in July 2010. Harley-Davidson still led the premium motorcycle sales in India for the past few years, led by the Models made in India Street 750. In the last financial year, Harley-Davidson India sold less than 2,500 units, and between April and June 2020, only about 100 Harleys were sold in India, making it one of the worst performing international markets.
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The Harley-Davidson Street 750 has been the brand’s best-selling offering in India
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Earlier this year, Jochen Zeitz replaced former CEO Matt Levatich as Harley-Davidson chairman, president and CEO. Levatich was at Harley-Davidson for 26 years, and with sales increasingly slowing down in recent years, his departure was seen as a move to provide a new strategic vision to revive the brand internationally. The plan ‘The Rewire’ outlined by Zeitz is intended to review Harley-Davidson’s product strategy, as well as focus on some 50 markets, primarily in North America, Europe and parts of Asia Pacific, which account for the “majority of the volume and growth potential. ” And India, the world’s largest motorcycle market, appears to have lost itself in those major markets where Harley-Davidson sees potential growth.
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