Harley Davidson is likely to finalise a distribution and management agreement with Hero MotoCorp this week, industry sources told CNBC-TV18. This comes after the United States-based motorbike maker in September announced that it will exit the India market.
The deal which has reportedly been under works for a while will give Hero MotoCorp exclusive distributor rights for Harley Davidson bikes imported to India from Thailand, the sources said. The immediate focus, however, will be on managing of Harley’s 33 Indian outlets and distribution network.
Moneycontrol could not independently verify the report.
An industry source further told the channel that negotiations took “months” as Hero was looking for more than just a distribution partnership. The Indian bikemaker prioritised a collaboration which “allows sharing of technology for a middle-weight motorcycle,” they added.
"Harley Davidson is looking at all models to maintain a presence in India. Harley may be open to a technology-sharing pact or contract manufacturing with Hero at a later date,” one source said.
“Since Harley announced an India exit I have sold only three or four bikes. There is a lot of uncertainty and people don't know what is going to happen to the company. Hope the company clears the air soon,” a Harley dealer told the channel. Some dealers are also considering legal action to pressure the company.
Harley is eager to have a deal in place by October-end to allow “transition time to the new distribution partner and assuage concerns of dealers and its rider community in India,” as per the report. The company has in fact assured dealers it will renew service contracts if a distribution deal is not fixed by 2020-end.