TIMES OF INDIA 3 Days Ago
Royal Enfield to remain focussed on 250-650 cc range
by Nandini Sen Gupta
CHENNAI: Royal Enfield may command a staggering 90% of the Indian mid-size motorcycle market but the heritage bike maker has no intensions of going beyond the 650 cc displacement range, at least in the near future. The company, which has just inaugurated its brand new plant in Oragadam, near Chennai, wants to remain focused on the 250cc-650 cc range, both for its home market India, as well as in its export push in other emerging markets.
"We have thought about a higher displacement cruiser bike but it's a no for the five year horizon," said Siddhartha Lal, MD & CEO, Eicher Motors, the mother company for Royal Enfield. The reason, he said, is that the mid-size market has enough potential for him to scale up without getting into what's traditionally been the happy hunting ground for American and European lifestyle bike brands. "Globally the mid-size market is under-served and if we can replicate the Indian success story in 5 or 10 other markets, that's good enough for us," he said.
“Globally the mid-size market is under-served and if we can replicate the Indian success story in 5 or 10 other markets, that's good enough for us”
Currently the 1.7 million unit strong global mid-size market is dominated by the likes of Honda, Triumph, Ducati and Harley Davidson. Most of these brands focus on higher-end, faster and bigger bikes whereas the Royal Enfield range is a smaller displacement machine "that allows more interaction with the terrain and offers purer biking," said Lal. "We don't want to dilute this focus."
RE's new facility in Oragadam - which will take its total production capacity to 175,000 units by the year-end, up 55% over 113,000 units clocked last year - will be scaled up to hit a peak capacity of 500,000 units to cater to both fast-speeding domestic demand and larger geographical spread in terms of exports. Already the second phase has been initiated so production can hit 250,000 units in 2014. "We were taken aback by how quickly demand scaled up and when the new capacity comes on stream the waiting period on the bikes in India should come down from 8 months to 6," said Lal.