JV with Harley-Davidson will elevate premiumisation strategy for Hero: Pawan Munjal

Zeitz: First, we want to celebrate how far we have come. We started this partnership in 2020 when we spoke for the first time and it’s exciting to be here to launch our first product in collaboration — X440. So what we want to focus on is — when we successfully launch in India, and get a good chunk of the premium segment with this motorcycle, which fits right into strategy that we launched in 2020 and 2021 — to selectively expand in each category with Harley Davidson.

Munjal: Both Jochen and I firmly believe in long-term relationship, and not one of the relationships. Hero has this urge of expanding the markets, reaching out to more and more customers, with whatever we have done in the past also. By bringing to the table this unique value proposition, we are a serious player to bring such products in the long time. The premium segment in India is close to 25 per cent of the overall motorcycle market and last year, it went up by 30 per cent, which is twice the rate of non-premium. And, if you look at the segment in which we are launching this, it is one-third of the premium bike units.

Zeitz: Our international motorcycle services (are being done) by Hero since it overtook the distribution of Harley-Davidson in 2020 and that will continue. At this moment, services will be available in our existing Harley-Davidson network and also on the Hero network.

Munjal: I don’t know of any other established player who has history longer than the 120 years of Harley-Davidson. So I would say Harley-Davidson is the most well established brand and player in motorcycling. Yes, it is the first time that Harley is coming into the 440cc segment in India, but with joint collaboration, joint creation, and co-creation of this particular bike with engineers from Milwaukee (Harley headquarters in the US), CIT (Centre of Innovation and Technology) Jaipur and Hero Tech Centre of Germany (Munich)... it is a fantastic product.

At Hero, this clearly will elevate the entire premiumisation strategy. And, for this bike, there are 100s and 1,000s of customers out there who would want to buy a Harley-Davidson, but so far were out of their reach/ pockets. But, now it is going to be affordable for them and we expect fairly large numbers to come in for this particular model. 

Munjal: This product will be sold through the current Harley dealerships plus select Hero dealerships. We will be launching a range of premium stores as well and 100 premium stores will come up by March 2024. Premium stores are not only for distribution but also about enhancing the premium image. 

Munjal: On the same platform, Hero is also developing its own bike with a ‘Hero’ badge which we will be launching within this fiscal year in the fourth quarter. So you will see products with different styling, features, sound and different performance as well. The bike will be quite different from X440 even though it will be from the same platform, may be because of different consumers. From this platform, we will be providing different kinds of bikes.

Zeitz: Right now, the focus clearly is on Harley-Davidson X440 for the Indian consumers... one step at a time. For the first time that Hero has gone up to this particular segment, this size of an engine... we have beautiful products with great performance. We want to prove ourselves that there are consumers out there and then talk about other things.

Zeitz: We used to manufacture Harleys in India, so I think it is well accepted... But, right now the focus is only on the Indian market and growing our business in India because we see a great potential in the premium segment.

Zeitz: If you look at our strategy in 2020, we had clearly said we want to focus on the most profitable premium segments, and there is no point in selling units if they never generate profits... it’s the premium segment that generates profitability. Our profitability over the last three years have gone up significantly for the company. It’s profitability and desirability that count, and not chasing the volume.