Hero MotoCorp announced on Tuesday a distribution agreement with Harley-Davidson for the Indian market through which Hero will sell and service Harley motorcycles in the country.
“Under a distribution agreement, Hero MotoCorp will sell and service Harley-Davidson motorcycles, and will sell parts and accessories and general merchandise riding gear and clothing through a network of exclusive Harley-Davidson dealers and the network of existing Hero dealerships in India. From a license agreement, Hero MotoCorp will develop and sell a range of premium motorcycles under the Harley-Davidson brand, “the company led by Pawan Munjal said today in a regulatory document.
The deal comes in the context of Harley announcing its business review actions under ‘The Rewire’ plan in September to change its business model in India.
“This arrangement is mutually beneficial to both Indian companies and drivers as it unites the iconic Harley-Davidson brand with Hero MotoCorp’s strong customer service and distribution network,” the company stated.
Earlier this year, Pawan Munjal, President of Hero MotoCorp, also indicated an agreement with Harley Davidson to manufacture and sell premium motorcycles in India.
In September, Harley-Davidson Motor Co. decided to exit India, and its departure brought the curtain down on a troubled period in a lucrative two-wheeler market.
After 11 years of operations in India, Harley said it will discontinue sales and production operations in India as part of a global restructuring plan.
The company had previously hinted at exiting some tough markets as part of its strategic plan, which involves pulling out of deficit markets and concentrating on the US, Europe and parts of Asia Pacific.
In India, the world’s largest and most price-sensitive market for two-wheelers, struggled with declining production and sales.
India’s production volume fell from 11,753 units in fiscal 2016 to 4,533 units in fiscal 2020 and sales decreased from 4,708 units to 2,470 units during the same period.
Harley-Davidson shares rose as much as 13% in better-than-expected earnings pre-market trading as CEO Jochen Zeitz’s moves to cut costs and increase margins on a smaller revenue base paid off. fruits in the third trimester.
Meanwhile, Harley-Davidson reported a 9.8% drop in quarterly revenue on Tuesday as global demand for motorcycles had yet to rebound from the business impact of COVID-19-induced crashes.
Revenues from motorcycles and related products fell to $ 964 million in the third quarter ended September 30 from $ 1.07 billion a year earlier.
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