NEW DELHI:
Iconic Harley-Davidson India bikes could well be available in India a tad cheaper thanks to the company’s decision to commence CKD operations in India. Currently the bikes are available in the country through the CBU route. While the completely built unit (CBU) route attracts a 100 per cent import tariff, the completely knocked down (CKD) route will reduce the import tariff impact to nearly 40 per cent.
“The impact of the existing duty structure, including import tariff and local taxes, for importing CBUs is nearly 100 per cent on US prices. The commencement of CKD operations will reduce the import tariff impact to nearly 40 per cent. In determining the impact on future pricing, the company will take into consideration the investments being made in our assembly and subsidiary operations, conversion costs, transportation, marketing and other such factors, including our need to grow our business and reinvest in the customer experience in the dealership and after purchase,” a company statement said.
“We will announce CKD models and pricing for those models in January, with our goal continuing to be increasing accessibility to our products and experiences to a broader set of customers and enthusiasts across India,” the statement added
Harley Davidson has decided to assemble its bikes at a greenfield facility at Bawal in Haryana. The American heavyweight’s motorcycles, which were hitherto shipped in as a CBU from its parent company’s plant, will now be imported as a CKD form. The Milwaukee-headquartered bikemaking firm, which will be assembling its select models, expects the assembly facility to be operational in the first half of 2011. Other models will continue to be imported as completely built motorcycles for now. It is to be me mentioned that the imported bikes currently attract 60 per cent import duty and 30 per cent local taxes are levied additionally thereby making the MRP of the product prohibitively expensive.
The announcement comes as U.S. President Barack Obama prepares to travel to India on a state visit focused on strengthening ties between the two countries, including trade and economic opportunities.
“We are building a strong foundation for our business in India, first by establishing a world-class dealer network, and now by commencing CKD assembly operations. It is important for us to continue to invest in strategies that make our products and experiences accessible to an increasingly broader set of customers across India,” said Anoop Prakash, Managing Director for Harley-Davidson India.
“We are delighted to announce the company’s plans to establish assembly operations in India,” said Harley-Davidson Motor Company President and Chief Operating Officer Matthew S. Levatich. “CKD assembly operations are a natural next step for Harley-Davidson as we increase our ability to meet the needs of India’s consumers.This investment will allow Harley-Davidson to improve our market responsiveness and production flexibility while reducing the tariff burden, which we expect will drive growth over time by making our bikes more accessible to India’s consumers. Given the strong response we have received in the initial months of retail operations, we believe this is the right investment for this important market” Levatich said.
India will be the second country in which Harley-Davidson has CKD assembly operations outside the U.S., after Brazil where the company began assembly operations in 1999. It is widely believed that Harley would be looking to enhance its foothold in emerging markets like India, after witnessing a massive drop in its volumes in developed markets like Europe, US, etc. The company will import CKD kits for select models, consisting of components produced by Harley-Davidson’s U.S. plants in Wisconsin, Pennsylvania and Missouri and by the company’s suppliers. HD India, however, refused to disclose the investment and the proposed capacity for its new Indian facility.
“We are committed to global growth and growth in India for the long term,” said Levatich. “India’s rapidly growing economy, rising middle class and significant investment in construction of new roads and highways are paving the way for leisure motorcycle riding.”
It may be recalled that Harley-Davidson India commenced operations in August 2009 and opened its first dealership in July 2010. The company currently offers 12 models, priced from Rs. 6,95,000-34,95,000, in its 2010 line-up in India, available through authorised dealerships in New Delhi, Mumbai, Chandigarh and Hyderabad.
Harley-Davidson, Inc. is the parent company for the group of companies doing business as Harley-Davidson Motor Company (HDMC) Harley-Davidson Financial Services (HDFS), and Buell Motorcycle Company (Buell). Harley-Davidson Motor Company produces custom, touring and cruiser motorcycles and offers a complete line of Harley-Davidson motorcycle parts, accessories, riding gear and apparel.
The announcement comes as U.S. President Barack Obama prepares to travel to India on a state visit focused on strengthening ties between the two countries, including trade and economic opportunities.
“We are building a strong foundation for our business in India, first by establishing a world-class dealer network, and now by commencing CKD assembly operations. It is important for us to continue to invest in strategies that make our products and experiences accessible to an increasingly broader set of customers across India,” said Anoop Prakash, Managing Director for Harley-Davidson India.
“We are delighted to announce the company’s plans to establish assembly operations in India,” said Harley-Davidson Motor Company President and Chief Operating Officer Matthew S. Levatich. “CKD assembly operations are a natural next step for Harley-Davidson as we increase our ability to meet the needs of India’s consumers.This investment will allow Harley-Davidson to improve our market responsiveness and production flexibility while reducing the tariff burden, which we expect will drive growth over time by making our bikes more accessible to India’s consumers. Given the strong response we have received in the initial months of retail operations, we believe this is the right investment for this important market” Levatich said.
India will be the second country in which Harley-Davidson has CKD assembly operations outside the U.S., after Brazil where the company began assembly operations in 1999. It is widely believed that Harley would be looking to enhance its foothold in emerging markets like India, after witnessing a massive drop in its volumes in developed markets like Europe, US, etc. The company will import CKD kits for select models, consisting of components produced by Harley-Davidson’s U.S. plants in Wisconsin, Pennsylvania and Missouri and by the company’s suppliers. HD India, however, refused to disclose the investment and the proposed capacity for its new Indian facility.
“We are committed to global growth and growth in India for the long term,” said Levatich. “India’s rapidly growing economy, rising middle class and significant investment in construction of new roads and highways are paving the way for leisure motorcycle riding.”
It may be recalled that Harley-Davidson India commenced operations in August 2009 and opened its first dealership in July 2010. The company currently offers 12 models, priced from Rs. 6,95,000-34,95,000, in its 2010 line-up in India, available through authorised dealerships in New Delhi, Mumbai, Chandigarh and Hyderabad.
Harley-Davidson, Inc. is the parent company for the group of companies doing business as Harley-Davidson Motor Company (HDMC) Harley-Davidson Financial Services (HDFS), and Buell Motorcycle Company (Buell). Harley-Davidson Motor Company produces custom, touring and cruiser motorcycles and offers a complete line of Harley-Davidson motorcycle parts, accessories, riding gear and apparel.