(November 4, 2010) Harley-Davidson is planning a low-cost model for India.

The U.S. bike maker, which reported a two per cent drop in global revenues from motorcycles at $1.09 billion for the September quarter, is betting big on India and China.

Chief financial officer John Olin has been reported saying, "We believe the long-term prospect (in China and India) is extraordinary."

The company expects to sell 200-250 bikes by the end of 2010, within six months of its launch in India. "Last year, as many as 1,000 superbikes were sold in India.

The market is growing at over 20 per cent every year and strong double-digit growth rate is expected to sustain at least for the next 8-10 years," said Anoop Prakash, managing director, Harley-Davidson India.

To strengthen its foothold in India, the company is setting up an assembly facility at Bawal in Haryana. The move will help Harley to save on import tariff and re-work pricing of its products for the Indian market. It will be the company's second assembly unit outside its home base. The other is in Brazil.

Once the assembly unit becomes operational in the first half of 2011, the impact of import tariff will be reduced to nearly 40 per cent.

The bike maker has four authorized dealerships in Delhi, Mumbai, Hyderabad and Chennai.

Source: rediff business