Harley Davidson closure will impact 2,000 workers and 35 dealerships: FADA

The closure of Harley Davidson operations in India will impact 2,000 workers and 35 dealerships, says the Federation of Automobile Dealers Associations (FADA). On Thursday, the iconic American motorcycle giant said it is discontinuing sales and manufacturing operations for its motorbikes in India.

The company is communicating with customers in India and will keep them updated on future support. Harley Davidson plans to close its manufacturing facility in Bawal, Haryana and reduce the size of its sales office in Gurugram. It said the dealer network will continue to serve customers through the contract term. The motorcycle makers exit from India is part of its global 2020 Restructuring Activities.

FADA, according to PTI, points out that Harley Davidson’s exit would also lead to a loss of up to Rs 130 crore for its dealers in the country. Vinkesh Gulati, FADA president, said the dealers are yet to receive any official communication about its plans for closure. He said dealers who have invested their hard-earned capital in this iconic brand are left like an abandoned baby without any compensation package. “With a luxury brand like Harley, setting up its dealership costs anywhere between Rs 3 to 4 crore with a total of 35 dealerships, Rs 110 to 130 crore will go down the drain,” Gulati said. “Luxury two-wheeler dealership on an average employs 50 people.” And with 35 dealers, up to 2,000 people will lose their jobs. Gulati observed that customers would also be impacted. He said there will be customers who will not receive glitch-free services as spares will now be in shortage, leading to harassment of dealers from customers.

Harley Davidson, after General Motors, MAN Trucks and UM Lohia, is the fourth automobile brand to shut operations in India in the last three years. Gulati highlights the need for a Franchise Protection Act. Had there been a Franchise Protection Act in India, brands like these would not have abruptly closed their operations, he said.