Harley’s in Hanoi

An agreement in principle reported by MEMA, indicates that Harley-Davidson motorcycles can one day roll through the cities and countryside of Vietnam, thanks to a deal on trade that opens the Southeast Asian country to more U.S. products. During the final round of negotiations in the Bilateral WTO Market Access Agreement between the U.S. and Vietnam, officials of the Office of the United States Trade Representative were successful in eliminating or lowering longstanding barriers to Harley-Davidson’s market entry in Vietnam. In addition to lifting an outright ban on large displacement motorcycles, Vietnam will adopt a basic and transparent motorcycle operators licensing system, relax distribution restrictions and reduce tariffs on heavyweight (650cc-plus engine displacement) motorcycles by 60 percent over time. Harley-Davidson has not yet announced any definitive plans for selling motorcycles in Vietnam. However, the company has long been interested in expanding its presence in Asia and considers market access of the kind provided by the trade agreement as key to its future expansion into Vietnam. In April, 2006, in another move into Asia, Harley-Davidson opened a dealership in Beijing — the company’s first dealership in mainland China since prior to World War II. The company has long been a major force in the motorcycle market in Japan, where Harley-Davidson retailed more than 11,000 motorcycles in 2005. Harley-Davidson first exported motorcycles to Japan in 1912. In 2005, sales of Harley-Davidson motorcycles grew 15 percent internationally over the prior year. International markets account for about 20 percent of the company’s annual motorcycle unit sales.