Royal Enfield Looking To Commission New Assembly Plant In South East Asia

The fact that Royal Enfield is doing very well in terms of domestic and international sales is no longer in doubt. In fact, Royal Enfield is pretty bullish about setting up assembly plants in South East Asia, preferably in countries like Thailand, Vietnam and Indonesia. Globally, the mid-capacity segment of motorcycles which ranges from 350 cc - 650 cc is a 2 million unit industry. Siddhartha Lal, MD and CEO, Eicher Motors and President, Royal Enfield had long ago said that the company is looking to grab a lion's share of this particular segment with its motorcycle model portfolio.

Siddhartha Lal, MD & CEO, Eicher Motors said, "We are extremely bullish on Thailand and Indonesia. We have seen very good traction for Royal Enfield bikes in these markets. We will have market companies with our own employees working there, where distribution will be done by us but dealers will be local. The idea is that it should be followed by local assembly but we are looking at different options."

(The next big launch from Royal Enfield will be the 650 Twins)

If we speak about exports, presently, only 2.3 per cent the company's sales or approximately 20,000 units contributed to the total annual sale last year as against total sales of 8.2 lakh units. Although, the exports are definitely on the rise. Last year, the exports grew by 25 per cent. The company is all set to increase the manufacturing capacity at its new plant in Vallam Vadagal in Tamil Nadu. Royal Enfield plans to invest Rs. 800 crore in a bid to increase capacity of the plant to a total of 1.3 million units per annum. The company plans to increase the manufacturing capacity by an additional 3.5 lakh units by the second half of the next financial year.

The next big launch from Royal Enfield in India will be the highly anticipated Interceptor 650 and the Continental GT 650. We expect the company to launch these two models in India within the next few months. For the first time, Royal Enfield will be offering motorcycles with a parallel-twin engine.

Source: Moneycontrol.com