Former U.S. President Donald Trump has frequently pointed to Harley-Davidson’s exit from India as evidence of what he called “one-sided” trade practices. He argued that India’s high tariffs on imported motorcycles forced the American motorcycle giant out of the Indian market. While tariffs did play a role in shaping Harley-Davidson’s strategy, the truth behind its exit is far more complex and largely rooted in low consumer demand and market mismatch rather than unfair trade barriers.
Trump’s Claims on Indian Tariffs
Donald Trump repeatedly criticized India for imposing high tariffs on American goods, especially on Harley-Davidson motorcycles. He often cited a 200 percent tariff figure, using it as an example of how India, in his view, “exploited” the United States in trade.
His central arguments included:
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India imposed excessively high import duties on U.S. motorcycles.
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Harley-Davidson had to build a plant in India to bypass tariffs.
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The Indian market was unfair to U.S. companies compared to Indian exports to America.
Summary Table
| Topic | Key Facts |
|---|---|
| Trump’s Claim | India imposed “200%” tariffs that killed Harley-Davidson in India |
| Actual Tariffs | Reduced from 100% to 50% in 2018 after U.S. pressure |
| Harley’s Strategy | Local assembly plant in Haryana from 2011 to reduce costs |
| Sales Figures | Fewer than 3,000 units annually in a 20-million-bike market |
| Main Issue | Low demand and mismatch with India’s commuter-focused market |
| Exit Year | 2020, as part of global restructuring strategy |
| U.S.-India Trade | Balanced, strategic, and growing despite disputes |
| Official Link | Harley-Davidson Official Website |
The Tariff Reality
The actual tariff situation was more nuanced than Trump suggested.
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Before 2018, imported motorcycles in India faced tariffs of 60 percent to 100 percent, depending on the model and cubic capacity.
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In 2018, during Trump’s presidency, India reduced tariffs on high-end motorcycles from 100 percent to 50 percent under U.S. pressure.
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While some reports referred to “200 percent tariffs,” this figure was not the standard rate; it only applied in specific cases depending on the import route and type of motorcycle.
Therefore, while tariffs were indeed significant, they were not insurmountable barriers, nor were they the main reason Harley-Davidson could not sustain itself in India.
Harley-Davidson’s Indian Market Strategy
Harley-Davidson entered India in 2009 and began assembling motorcycles locally in 2011 at its plant in Bawal, Haryana. The move aimed to reduce import costs and make its bikes more affordable for Indian consumers.
However, the company consistently struggled with sales:
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At its peak, Harley-Davidson sold only around 2,500-3,000 units annually.
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By comparison, India’s two-wheeler market sells over 20 million motorcycles and scooters every year.
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The average Harley-Davidson price ranged from ₹5 lakh to ₹50 lakh, placing it far beyond the purchasing power of most Indian consumers.
Harley attempted to introduce lower-capacity models such as the Street 750 to capture younger and more price-sensitive riders. However, it still failed to compete with domestic giants like Hero MotoCorp, Bajaj Auto, and Honda, which dominate India’s commuter motorcycle segment.
Why Harley-Davidson Exited India
In 2020, Harley-Davidson announced it would discontinue its sales and manufacturing operations in India. The reasons were clear:
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Low consumer demand – High-end motorcycles remained a niche luxury segment.
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Unfavorable economics – Despite localization, Harley struggled to achieve economies of scale.
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Competition from established brands – Affordable and reliable commuter bikes dominated consumer preference.
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Global restructuring – Harley’s withdrawal from India was part of its broader “Rewire” strategy to streamline global operations and focus on core profitable markets.
Tariffs were only a peripheral factor. The fundamental issue was Harley’s inability to penetrate a market where affordability and practicality drive purchasing decisions.
India-U.S. Trade Relationship Beyond Harley-Davidson
Despite Trump’s rhetoric, India-U.S. trade has grown steadily and remains strategic. Key points include:
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In 2020, India was the ninth-largest trading partner of the United States.
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Bilateral trade covers not just goods, but also services, technology, defense, and energy.
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Disputes over tariffs exist, but both nations view trade as a cornerstone of their strategic partnership.
Harley-Davidson’s exit is, therefore, not an accurate reflection of India-U.S. trade dynamics but rather a case study of brand positioning and market economics.
Frequently Asked Questions
Q1: Did tariffs force Harley-Davidson out of India?
A. No. While tariffs were high, India reduced them in 2018. Harley-Davidson exited mainly due to low demand and weak sales performance.
Q2: Why couldn’t Harley-Davidson succeed in India?
A. The brand’s high-priced motorcycles were unaffordable for most Indian consumers, who preferred commuter bikes that cost a fraction of Harley’s models.
Q3: Is India still open to luxury motorcycle brands?
A. Yes. Brands like Triumph, Kawasaki, and BMW continue to operate in India, though they serve niche segments with modest sales.
Q4: How important is India-U.S. trade today?
A. India and the U.S. share a growing and strategic trade relationship across multiple sectors, with disputes limited to specific tariff and market access issues.
Q5: Will Harley-Davidson return to India?
A. Harley-Davidson has re-entered the Indian market in partnership with Hero MotoCorp to sell premium motorcycles, but on a much smaller scale.
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