- A team has also been set up to look out for the commercial side of the business.
- The automaker has lined up a capex of about INR 1,000 crore for FY 2023-24
Royal Enfield, the renowned motorcycle brand under Eicher Motors, has announced that it is testing a prototype model for its first own Electric bike, to launch within two years.
As part of this ambitious venture, the company has earmarked a capital expenditure (capex) of INR 1,000 crore for the fiscal year 2023-24. A significant portion of this budget is allocated for EV product development and establishing a robust sales infrastructure. This is a significant increase from the INR 650 crore capex for FY 2022-23.
B. Govindarajan, CEO of Royal Enfield, shared the company’s active approach towards the EV market, revealing that they have onboarded around 100 professionals dedicated to their electric vehicle division. The company is rapidly gearing up to establish a 1.5 lakh EV unit production capacity, with plans for a modular unit setup.
Royal Enfield, synonymous with models like Classic and Bullet, has long been the leader in India’s premium motorcycle segment, claiming approximately 90% of the market for bikes over 250 cc. However, with new entrants like Bajaj-Triumph’s Speed 400 and Scrambler 400, as well as Harley Davidson’s partnership with Hero MotoCorp producing the X440, the competition is heating up.
“With new competition coming in, at 90%, there is only one way the market share could go: south. Even though we will fight hard for it, we are many steps ahead of the competitors, so we are okay with that. We believe we will be able to hold on to 80% share in the medium to long term.” Said Siddhartha Lal, managing director & CEO of Eicher Motors.
Lal further emphasized Royal Enfield’s exceptional resale value and perceived the rising competition as a stimulant for the mid-size motorcycle market’s overall growth. He expressed optimism for the sector, anticipating the current market size of 1 million units to burgeon to 1.5 to 2 million units by the decade’s conclusion.
Royal Enfield’s sales increased by 21%, selling 2.2 lakh motorcycles, compared to 1.86 lakh units in the year-ago quarter. On the international front, the motorcycle brand launched its fifth CKD assembly unit in Birgunj, Nepal, spanning 1 lakh sq ft, to bolster its presence in the SAARC region. Additionally, VECV, a collaboration between the Volvo Group and Eicher Motors, had its best Q1 yet, selling 19,571 units, a growth from 17,469 vehicles in the same quarter of the previous year.
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