Royal Enfield Considering CKD Assembly Plant In Mexico

Royal Enfield is evaluating whether to set up a new assembly facility from completely knocked down (CKD) kits in Mexico. The news comes after Mexico increased import tariffs on motorcycles, Royal Enfield Chief Executive Officer B Govindrajan is reported to have said. The comments by RE’s CEO came after its parent company Eicher Motors announced its FY26 earnings.

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“The Mexico tariff has been slightly changed. We are studying that. Is there a requirement to have a manufacturing facility or not? We are constantly evaluating it,” Govindrajan is quoted to have said in reports.

“We were paying 15 per cent tariff in Mexico. That has increased to 35 per cent from January. We are studying that. If it is required, we may have to take some action on it,” added Govindrajan.

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Royal Enfield already operates several global CKD assembly plants including Brazil, Colombia, Bangladesh, Nepal and Thailand.

“We have almost seven CKD plants across the globe for Royal Enfield. So, we have the playbook ready with us. Any country where we need to go with a completely knocked down facility to establish, to be near to the customers, we will use that playbook and then go into the market,” he said.

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Royal Enfield sold about 1,20,000 motorcycles in international markets during the year, and the company said its international volumes grew about 20 per cent in the financial year which ended in March 2026. Brazil has emerged as the brand’s largest international market outside India and was amongst its fastest-growing overseas business. In the domestic market, Royal Enfield is planning to ramp up production – targeting an increase in annual production capacity from 1.4 million units to nearly 2 million units.

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