Harley-Davidson, the iconic American motorcycle maker, recently announced its plans of launching low capacity models in emerging markets like India. These upcoming low-cost, low-displacement Harley Davidson models will help the much-revered American brand establish a really strong foothold in the Indian two-wheeler market. However, in a recent interview, Rajiv Bajaj, Managing Director, Bajaj Auto Ltd, has played down any sort of threat from Harley entering the more mainstream segments of the market. In fact, Bajaj has termed the upcoming Harley-Davidson 250 – 500 cc bike as ‘pipsqueak’. Well, here’s what he means.
Rajiv Bajaj goes on to explain how a brand should play to its strengths. Rajiv says he has learned from his own failures that a brand should always play within its ‘Laxman Rekha’, which, basically, means that one should always stick to his strengths. In Harley’s case, its strength lies in producing some of the biggest and loudest motorcycles on the planet. A 250cc motorcycle, on the other hand, won’t be anywhere as big or loud as, say, a Street Glide or even a Street 750, for that matter. Even in the case of Street 750, which is a low-cost model developed for markets like that of India, Harley-Davidson faced many challenges with quality control. That said, most buyers welcomed an entry-level Harley and were willing to put their money on it.
“One can never underestimate any competitor and certainly not someone like Harley, but I will stick my neck out and say this, I have learned, even from our own failures that the minute a brand steps out of its ‘Laxman rekha’ it’s on very thin ice,” Bajaj said.
However, a similar top-down approach might not work in case of the upcoming 250cc model. The Street 750, in spite of being a low-cost Harley, is a pretty big motorcycle and manages to maintain the bold characteristics of Harley Davidson motorcycles. A 250cc model, on the other hand, won’t be anywhere as big and loud as the conventional Harleys. Moreover, it will be really tough for the American company to maintain its international quality standards without pricing the upcoming entry-level models exorbitantly.
Like Rajiv Bajaj said, he has learned from past experiences that one shouldn’t cross the proverbial Lakshman Rekha. Bajaj Auto Ltd, which is best known for its Pulsar range of motorcycles, tried to dominate the lower segment with the Discover range. However, in spite of launching a gazillion variants to suit every budget, the Discover could get only a lukewarm response. Similarly, Bajaj Auto Ltd has even tried its hand at selling ultra-frugal, low-cost commuters. While the likes of CT100 have found some buyers, they have pretty much failed to garner the kind of response that traditional players like the Hero Splendor and Passion enjoy. Hence, the company has now shifted its entire focus to performance-focussed products.
Even if you look at the car industry, Maruti Suzuki, which has been the unchallenged market leader, has pretty much failed to excite premium car buyers with its Grand Vitara SUV and Kizashi sedan. While Harley’s top-down approach is completely opposite of Maruti’s strategy, its 250cc offering might fail to excite the buyers owing to the lack of the traditional qualities that Harley models possess.
Source – CNBC