Can India-USA Trade Agreement Help Revive Harley-Davidson's Declining Sales?

Reports suggest that fully built motorcycles imported from the United States, including Harley-Davidson models, could soon benefit from duty-free access to the Indian market under a new interim trade agreement between the two countries. While the official details are yet to be disclosed, early indications point to motorcycles with engine capacities between 800cc and 1,600cc being exempted from import duties.

At present, bikes in this displacement range attract around 44% import duty, which includes basic customs duty and a social welfare surcharge. Removing these charges could lower prices for select premium motorcycles, although the actual impact on sales may depend on demand trends.

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Between April and December 2025, Harley-Davidson sold 97 units in the 800-1600cc category, reflecting only a marginal 1% year-on-year growth. This tally includes models such as the Nightster, Sportster S, and Pan America, which form part of Harley's newer, globally relevant lineup aimed at younger riders. Despite their appeal, volumes remain modest.

In contrast, Harley sold 90 units of motorcycles above 1600cc during the same period, marking a 15% decline compared to the previous year. Larger cruisers like the Fat Bob, Road Glide, and Street Glide continue to face weakening demand in India, underscoring a shift away from heavyweight cruisers toward mid-capacity machines.

The proposed duty-free access would therefore primarily benefit Harley's mid-capacity models rather than its traditional big cruisers. While the short-term sales boost may be limited, the move could help correct pricing distortions that have long affected Harley's completely built-up (CBU) imports in India.

Harley-Davidson had exited local manufacturing in 2019 due to weak demand, much of it driven by high import duties. The brand later re-entered the market through its partnership with Hero MotoCorp, focusing on locally built sub-500cc models such as the X440. If the duty relief is implemented, it would complement this strategy by making Harley's imported mid-capacity motorcycles more competitive, potentially improving its overall sales performance in India.