Harley Davidson exit could impact 2,000 jobs: FADA
Automobile dealer body Federation of Automobile Dealers Associations (FADA) said the closure of Harley Davidson's operations in India would lead to job loss for up to 2,000 workers across the brand's 35 dealerships in the country.
In addition, the discontinuation of sales and manufacturing operations in the country by the American cult bike maker. would also lead to a loss of up to Rs 130 Cr for the brand's dealer partners in the country.
FADA President Vinkesh Gulati stated, “Harley Davidson has not informed any of its dealer partners about its closure plans and dealers are yet to receive any official communication.”
He added that it goes without saying that dealers who have invested their hard-earned capital in this iconic brand would be left at a loss without any compensation package.
With a luxury brand like Harley, setting up its dealership costs anywhere between Rs 3-4 Cr, and with a total of 35 dealerships, Rs 110-130 Cr will go down the drain as per Gulati. As luxury two-wheeler dealership on an average employs 50 people, with 35 Harley dealers, around 1,800-2,000 people at dealerships will lose their jobs, he added.
After General Motors, MAN Trucks and UM Lohia, Harley Davidson becomes the fourth automobile brand shutting shop in the last three years in India. As per Gulati, had there been a Franchise Protection Act in India, brands like these would not have abruptly closed their operations, leaving their channel partners and customers in a fix.
The automobile sector like other sectors has also been facing a tough year on account of the pandemic. Following the nationwide lockdown implemented in late March, April turned out to be a disastrous month for the automotive industry as it registered zero sales. However, in more recent months, there has been some uptick enabling the industry to revive to nearly pre-COVID-19 levels. But given the sentiments that prevail in the economy, the Society of Indian Automobile Manufacturers (SIAM) has projected a bleak outlook for the industry in 2020-21.