Harley-Davidson to lock horns with Royal Enfield; plans entry into sub-500cc segment with 16 models priced upwards of Rs 5.25 lakh

US-based firm Harley-Davidson plans to put a brake on Royal Enfield’s plans with its strategic move to come out with motorcycles in the small and mid-sized segment. The plans are for its India and China markets, media reports said.

Harley-Davidson said it plans to develop a 200-500cc motorcycle through a strategic alliance in Asia which will be used to primarily fuel its growth in India.

In April, Royal Enfield had announced that it will strengthen its offerings with new models and variants such as the new Thunderbird X, the Classic Gunmetal Grey, Stealth Black and Redditch series, as well as soon-to-be-introduced Twins.

Harley-Davidson’s entry into the small and mid-sized motorcycles segment is not only to expand its customer base but also to one’s of the world’s largest and fastest-growing markets.

Sharing its global growth road map through 2022 the US-based cult bike marker said it plans to launch the small displacement motorcycle, meant for emerging markets, in India within two years.

It also plans to add 'lighter, smaller and more accessible products' through 2022 in its electric motorcycles portfolio. It will kick-start with the launch of its first electric motorcycle, LiveWire in 2019.

Harley Davidson motorcycles are displayed for sale at a showroom. Reuters

Harley Davidson motorcycles are displayed for sale at a showroom. Reuters

Moreover, the company said it will develop a new modular 500cc to 1,250cc middle-weight platform of motorcycles on which multiple models in three distinct product categories and four displacements, can be developed.

In an investor communication, Harley-Davidson said, "We intend to enter into a strategic alliance in Asia to launch a 250-500cc motorcycle within 2 years in India, and into other emerging markets in Asia over time."

The move is aimed at expediting market entry and increase brand access and volume and the new product would serve as a bridge to the company's larger motorcycles.

It will also "enable accessible price point for premium small displacement market entry", it added.

The planned alliance in Asia will "leverage on world-class partner's manufacturing scale and retail footprint", the company said without disclosing further details.

In India, the company said a growing middle class and product introductions by domestic manufacturers are providing stimulus. The 200-500 cc segment saw sales of 7 lakh units in 2017 growing at 25 percent.

The over 500 cc segment grew by up to 28 percent selling around 8,500 units last year, as per industry estimates.

"Competitors have entered into various alliances and partnerships to accelerate the pace of market entry (in India)," the company said.

Harley-Davidson sells 16 models in India ranging from Street 750 with starting price of Rs 5.25 lakh to CVO LIMITED tagged at Rs 49.99 lakh.

On electric bikes, it said Livewire will be the first in a broad, no-clutch 'twist and go' portfolio of electric two-wheelers "designed to establish the company as the leader in the electrification of the sport".

"LiveWire will be followed by additional models through 2022 to broaden the portfolio with lighter, smaller and even more accessible product options to inspire new riders with new ways to ride," it added.

The company further said it will drive to extend its leadership in heavyweight motorcycles by continuing to develop improved, more technologically-advanced Touring and Cruiser motorcycles.

Harley-Davidson President and Chief Executive Officer Matt Levatich: "We expect this plan will result in an engaged, expanded Harley-Davidson community with a more diverse rider base, along with industry-leading margins and cash flow."

-- With PTI inputs


Updated Date: Jul 31, 2018 12:26 PM