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Harley-Davidson is discontinuing India operations: Here's why

Shubham Sharma
·2-min read


Harley-Davidson is discontinuing India operations: Here
Harley-Davidson is discontinuing India operations: Here

24 Sep 2020: Harley-Davidson is discontinuing India operations: Here's why

In an unexpected move, American motorcycle maker Harley-Davidson has announced the plan to discontinue its operations in the Indian market.

The action comes as part of a restructuring strategy described as "The Rewire" and will see the company end its manufacturing and sales in India.

Here is all you need to know about it.

Costs: US SEC notified about additional restructuring actions

On Thursday, Harley-Davidson notified the US Securities and Exchange Commission about additional restructuring costs under "The Rewire" strategy for 2020.

The company said, between August and September, it "approved commitments to additional restructuring actions under The Rewire related to optimizing its global dealer network, exiting certain international markets, and discontinuing its sales and manufacturing operations in India."

Expenses: Restructuring expenses of $75 million

Harley-Davidson noted in the regulatory filing that it expects to incur $75 million in expenses as part of the additional restructuring action.

Of this, the company expects "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."

Notably, 80% of these expenses will be cash-based, the company added.

Plan: Restructuring to be wrapped up in 12 months

The entire global restructuring plan of the company, estimated to cost approximately $169 million, is expected to be completed in the next 12 months.

In the Indian market, where Harley-Davidson has been operating for over a decade, the company will be reducing its workforce by about 70 employees to execute the restructuring effort in accordance with the plan.

Reason: But, why leave Indian market?

Though Harley-Davidson has not commented on its India exit, The Rewire plan is aimed at shifting the company's focus on more profitable motorcycles and markets where it sees potential growth such as the US.

The company had also previously said that it planned to reduce its product portfolio and exit lower-volume markets.

India accounted for less than 5% of the company's global sales.