What a possible Harley-Davidson-Hero MotoCorp deal could mean for India

Harley-Davidson shutting shop in India has come as a blow to countless biking enthusiasts in the country and despite the fact that the products from the American company catered to a niche audience due to the high prices, Harley did manage to create quite a fan base here. Facing headwinds the world over, Harley's decision to move out, however, does not mean that its products won't be available in India any longer.

Shortly after it was reported that Harley-Davidson would bring its plant in India to a close and significantly reduce staffing numbers at its office in Gurgram, reports also emerged that it is in talks with Hero MotoCorp to possibly make it the sole importer and distributor of its bikes here. Quoting two sources, Reuters reported that both companies are in an advanced stage of talks over distribution arrangement that will allow the Indian company to import and sell Harley bikes as its sole distributor. (Read full report here)

While Harley-Davidson and Hero MotoCorp have neither confirmed nor refuted the report, sources have told news channel CNBC TV18 that an announcement of a distribution arrangement could be announced as early as this week.

What would such an arrangement, if at all, mean for the Harley-Davidson fans here? For starters, it is not as if die-hard fans with the budget for a Harley bike won't be able to own one anymore now that the company is shipping out. Hero MotoCorp is the world's largest manufacturer of motorcycles and scooters and is expected to be more than capable of handling the import and distribution network for Harley products.

Does it mean Harley can look at selling products in big numbers? Well, India was hardly a strong market for the company while it was here anyway. Sales in the country accounted only around 5 per cent of its global sales. This despite the fact that Harley had entered the Indian market back in 2009.

What happens to the around 2,000 jobs across dealerships that are now at risk, as per Federation of Automobile Dealers Association? A distribution partnership with Hero MotoCorp, if one does take place that is, is unlikely to come as a lifeline for those previously engaged with Harley in India. Yet, it could end up with some jobs perhaps being saved.

Much would depend on whether the two companies do indeed join hands and make an official announcement. A decision in this regard would be keenly followed, not just by Harley fans and prospective buyers but also (former) employees of the American brand here.