A subsidiary of Eicher Motors, Royal Enfield has announced to invest Rs 600 crore in the two-wheeler business in the current financial year. The company aims to increase its production capacity with this investment in order to meet the increasing demand for its products and reduce the waiting period on them. A majority of this investment will be made in the upcoming facility of the company in Vallam Vadagal, near Chennai.
Announcing the results for Q2, FY-17, along with the future expansion plans, Siddhartha Lal, MD of Eicher Motors, also confirmed to bring a completely new product by the end of this financial year. Lal said, "Himalayan has done exceptionally well. We are delighted with its performance and it is growing in numbers. Going ahead, we will have one big product this financial year, we will be launching something significant next year, we will have variants as well. At Royal Enfield level, this financial year, we are going to be investing around Rs 600 crore, a good chunk of this. The largest will be in new plant, followed by UK tech centre, followed by products."
If we are to believe the previous reports and spy pictures, we can expect the 750cc parallel twin-powered motorcycle to be the upcoming product. And if it is true, it will be a big bang from Royal Enfield in the mid-size motorcycle market, which could directly hit products like the Harley-Davidson Street 750 and the entry-level Triumph ‘modern classics.’ And the most appealing factor with the flagship RE will definitely be the aggressive pricing with respect to the engine capacity of the motorcycle. As per the report, the company might also schedule a few more variants of the upcoming motorcycle for the next couple of years, which will help them maintain excitement among enthusiasts.
Apart from the new facility, another part of the investment will be made in the development of the new products at Royal Enfield's UK tech centre. This is the same facility where the upcoming 750cc parallel-twin engine was spotted testing on a modified Continental GT's platform. We are not saying that the company will surely launch a 750cc cafe racer this financial year -- it might be a different type of motorcycle. However, we can't deny the fact that one of the variants on this new platform could be a café-racer.
Lal has also confirmed that the upcoming Royal Enfield plant will be operational by September 2017. And with the help of this new facility, the company will be having a capacity of 9 lakh units by FY-19.