Trump: Tariff Killed Harley-Davidson In India; Why It Really Exited India?

The USA is India’s biggest trading partner. But New Delhi's decision to purchase Russian oil has strained trade ties. President Donald Trump has imposed a 50% tariff on key Indian exports to the USA since August 27. As per news reports, in a recent press conference, he even remarked that the Indian government imposed 200% tariffs on Harley-Davidson, forcing it to exit. But were tariffs really the cause?

In this article, we explore the truth behind the remarks.

How Much Tariffs Did the Govt Impose on the Bikes of Harley-Davidson?

India historically had high import duties on motorcycles, sometimes reaching up to 100% on fully built bikes. However, these tariffs have been steadily reduced over time.

For example, by 2025, the tax on fully assembled motorcycles above 1,600cc has been cut to around 30%. This tariff reduction showed India’s willingness to ease trade barriers and support foreign brands like Harley-Davidson.

A look at news reports says that while tariffs were initially a challenge, they were not the sole or even the primary reason behind Harley-Davidson’s struggles in India.

Why Did Harley-Davidson Sell Less Than 30,000 Bikes in 10 Years?

Harley-Davidson exited India in September 2020, but the departure wasn’t primarily about tariffs. Since its entry in 2009, the company had sold fewer than 30,000 motorcycles over 10 years. The core issue was that Harley-Davidson’s heavy, expensive cruiser motorcycles failed to match the demand for affordable, fuel-efficient bikes.

Here is a full list of all the reasons collated based on news reports on why Harley-Davidson failed to capture the imagination of Indians:

• The COVID-19 pandemic delayed India’s two-wheeler demand by 2 to 3 years and caused a sharp decline in sales of high-end motorcycles.
• Unlike many competitors, Harley-Davidson did not partner with a strong local manufacturer, limiting its ability to adapt to the market.
• Competitors like Royal Enfield, Triumph, Jawa, and Norton offered motorcycles that were more affordable and better suited to Indian customers.
• The company failed to capitalise on the growing popularity of touring, adventure, and sports bikes in India.
• The brand had a limited sales network with only 35 dealerships across India, restricting its reach beyond major metropolitan areas.
• A recall of nearly 3,700 motorcycles in 2015 due to faulty fuel pumps harmed the company’s reputation in India.
• Customers frequently complained about poor after-sales service, including long wait times for parts and costly maintenance.

Read more: GST Council Meet Starts Today: Big Tax Reforms and Rate Cuts on the Table.

Conclusion

Harley-Davidson’s exit from India was not simply the result of steep tariffs, as suggested by President Trump. While import duties were initially high, they were significantly reduced over time, showing India’s intent to support foreign brands. The real reasons behind Harley’s struggles included misaligned product offerings, limited sales reach, and its shortcomings in understanding local consumer needs.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.