Royal Enfield to increase production capacity

  • Feb 19, 2014
  • Views : 8359
  • 2 min read

  • By Pti
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Eicher Motors, the parent company of Royal Enfield announced that it will invest Rs 600 crore to amplify its production capacity

Royal Enfield Continental GT rear shot

Eicher Motors plans to invest Rs 600 crore in two years to ramp up production capacity of its motorcycle division Royal Enfield and also to develop new global platforms as well launching new bikes starting 2016. Royal Enfield is looking to complete work at its Oragadam facility in the next two years thereby taking the total capacity across the two plants to over 5 lakh units annually by 2016. It had produced a total of 1.78 lakh bikes in 2013. 

"We will be making an investment of Rs 600 crore in Royal Enfield towards capacity expansion and development of new global product platforms over 2014 and 2015," Eicher Motors Ltd MD and CEO Siddhartha Lal told reporters here. The investment will go into capacity expansion, improving research and development (R&D) infrastructure and adding new products, he added. "Last year, we had set a production target of 2.5 lakh units for 2014, but now it has been revised to 2.8 lakh units considering the demand for our bikes in the market," Lal said. 

Royal Enfield Thunderbird 500 front shot

By 2015-end the Oragadum plant would be completed fully thereby taking the total capacity to around 5 lakh units per annum, he added. Lal said the additional capacity would help in reducing the waiting periods for various models. When asked about the new product platforms, Lal said: "In the next 5-7 years horizon, we will be entirely focused on the mid sized motorcycle segment (250 cc-750 cc). We do not have any intention to enter below or above this segment." He added that the new platforms are being developed keeping in mind global ambitions of the company. 

"We are working on multiple platforms. What will be the final outcome can't be known now," Lal said. The company, which sells Bullet, Classic, Thunderbird and Continental GT models, is also looking to enhance its dealer network in the next three years from the current 300 to 500 dealerships in the next two to three years. 

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