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Updated: February 13, 2014 23:57 IST

Eicher draws up Rs. 600-crore expansion plan for Royal Enfield

Staff Reporter
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Siddhartha Lal
Siddhartha Lal

Eicher Motors, which manufactures and markets Royal Enfield motorcycles, plans to invest Rs. 600 crore in two years for capacity expansion as well as developing and launching new products.

“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 said.

The investment would be made 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,” Mr. Lal said.

Further, the company 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 produced 1.78 lakh bikes in 2013. Mr. Lal said the additional capacity would help in reducing the waiting periods for various models.

Asked about the new product platforms, he said, “In the next 5-7 years , 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 were being developed keeping in mind the company’s global ambitions .

The company, which sells Bullet, Classic, Thunderbird and Continental GT models, is also looking to enhance its dealer network in the next three years.

“We currently have around 300 dealerships across the country. In the next 2-3 years, this number will grow to around 500,” Mr. Lal said.

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