Royal Enfield To Shut Down Several Regional Offices

Iconic Indian motorcycle brand Royal Enfield has decided to shut down as many as 12 regional offices, including its corporate office in Gurugram as part of latest cost cutting measures in the midst of the coronavirus pandemic. An internal circular made the announcement to Royal Enfield employees that all regional teams across the country will continue to work from home, and that the lockdown has already "provided an opportunity to pilot the work from home set up." Offices in Gurugram, Chennai, Bengaluru, Mumbai, Jharkhand, Hyderabad, Bhubaneshwar and others will be shut down immediately.

The circular stated that "the admin team has begun the process of renegotiating the terms for an early exit for the remaining RO (regional office) locations, where the lock-in period is beyond one year, but sales, service, apparel employees in these regions will continue on a work-from-home basis."

Also Read: Eicher Motors Net Profit Plunges To Rs. 304 Crore In Q4 2020

Royal Enfield's international sales are led by the Interceptor 650 and Continental GT 650

carandbike reached out to Royal Enfield for confirmation, and a spokesperson has confirmed the development. Royal Enfield's Chief Commercial Office (CCO) Lalit Malik confirmed the decision to shut down regional offices after announcing the March quarter results. The last quarter of this fiscal was particularly challenging in the wake of the unprecedented coronavirus pandemic, Royal Enfield said in a statement. The company's manufacturing and retail operations were suspended between March 23 and May 5 as per government directives. The company has since resumed operations and more than 90 per cent of its retail network is now operational.

"Earlier it was theoretical, that we can work from home. Now, apart from the folks who have to work on the machines, and in the factories, and we can't do without that activity, barring that, there are a whole lot of 'office folks' like myself, who actually can work from home. Covid has established that it can work, but it was in our minds prior to that also. A lot of places, people used to complain that they had to travel a lot, between the regional office, and their own homes and then visit the dealer in between and so on and so forth. So, travel was almost a headache, especially in placed which are crowded like Delhi and Mumbai, Chennai and Bengaluru. But now with work from home, it worked for us. So, we thought, let's close down a few of these regional offices, and find nicer ways to improve the work-life balance of these chaps. So, why spend time on the road when you don't have to," said Lalit Malik, Chief Commercial Officer, Royal Enfield.

Also Read: Royal Enfield Sales Fall 69 Per Cent In May 2020

The Royal Enfield Classic 350 is the company's highest selling model

The move comes at a time when the ongoing coronavirus pandemic and subsequent countrywide lockdown across many countries in the world have hit sales and revenue hard for most businesses. The Indian auto sector has been no exception either, and has been facing increasing pressure after a countrywide lockdown which saw near zero sales in April for Royal Enfield and a 69 per cent sales decline in May 2020. On June 12, 2020, Eicher Motors, the parent company of Royal Enfield announced its financial results for the fourth quarter, which reported a decline of nearly Rs. 300 crore in revenue from total operations.

Also Read: Royal Enfield Sells 91 Units In April 2020

Apart from popular models like the Bullet, Royal Enfield is expected to introduce several new models in the next 3-4 years

Despite the challenges, Royal Enfield continues to remain bullish. Chief Executive Officer Vinod Dasari said in a statement that Royal Enfield has had the best ever export performance in international markets during the year with a 96 per cent increase compared to last year. And Royal Enfield continues to strengthen its distribution network in India and international markets. In the January to March 2020 quarter, Royal Enfield added 100 new Studio Stores, taking the overall retail touchpoints to 1,521 across India, with 921 dealerships and 600 Studio Stores.

Royal Enfield is working on several new models, with the first motorcycle, the Royal Enfield Hunter 350 to be launched soon. The RE Hunter 350 will be based on an all-new 350 cc platform which will also form the base for other models. In fact, Royal Enfield intends to launch one model every quarter for the next 3-4 years, and these will be positioned as all-new products, which will, in all likelihood, form part of the product strategy to achieve Royal Enfield's goal of becoming the leader in the global mid-size motorcycle industry.