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In recent news, Harley-Davidson has just announced that the company is building a new motorcycle factory in Thailand to serve the Asian market. The factory will soon be erected in Rayong province, Thailand which is geographically located at the southeast of Bangkok. This will allow the American motorcycle trademark to circumvent Thailand's tariffs of up to 60 per cent on imported motorbikes.

The planned strategy will also aid Harley-Davidson to have tax sops when distributing to Thailand's fellow Asian nations, counting India. Thailand is one of the countries under the free trade arrangement done by the Association of Southeast Asian Nations (ASEAN).

The Thailand plant will be the second factory in Asia as Harley Davidson already erected a plant in Bawal, India, where the Street 750 model is mainly mass-produced. Also at the same factory, Harley-Davidson's latest model, the Street Rod, is where it is primarily processed.  

Also, Harley accumulates motorcycles at a plant in Brazil and has a wheel factory in Australia. The Thailand factory will construct motorbikes for the Asian marketplace, which have so far been traded in from India or the US. It is envisioned to support the Chinese market as well with ASEAN following a puffed-up free trade expanse with Beijing.

Harley-Davidson public relations manager, Katie Whitmore, told reports that "The Thailand facility will allow us to be more responsive and competitive in the ASEAN region and China. Increased access and affordability for our customers in the region is vital to growth for the company in total. There is no intent to reduce H-D U.S. manufacturing due to this expansion."

Growing Competition

Harley-Davidson isn’t the first motorcycle factory to expand its markets in the said region under the free-trade agreements done by the ASEAN countries. To add, Triumph and Ducati have already erected plants in Thailand. More so, several of the Ducati models marketed in India are essentially manufactured under Thailand’s plants, but have a rate benefit above traditional importations from Italy.

Contrariwise, it's still indefinite as to which Harley-Davidson reproductions will be manufactured as a final point in the Thailand workshop, and whatever will the Indian customer lastly get on those prototypes. According to reports, the Harley-Davidson Thailand plant will amass economy motorbike which would mean that the luxury bikes from the company will still come from the US and the Asian plant will only cater to Asian markets only.

In India, the country still benefits from the Street Rod and Street 750 from the time being. "This is absolutely not about taking jobs out of the United States," a managing director of international sales at Harley-Davidson, Marc D. McAllister, told reports. "This is about growing our business in Asia."

Trading Perspective

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Harley-Davidson is still considered a weak stock due to its recent performances in its trading sessions. However, it started to show signs of possible recovery. In its most recent candle, the motorcycle stock opened trade at 51.78 which ended at 52.32 with a high of 52.58 and a low of 51.58.

As for its indicators, the Coppock curve inched up a little to -12.63 – a quite noticeable upturn from -12.70. For its RSI level, the stock just recently made it up beyond the 30’s range which can be said that it is not that oversold any more. Currently, it’s RSI is at 31.25.

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