The waiting period for the Classic 350 from Royal Enfield, costing Rs 1.32 lakh (on road, Mumbai), stretches from eight months to one year. There is more.
In a market that has seen a four per cent fall in industry sales of two-wheelers over the past three months, Royal Enfield, which specialises in leisure products, has seen its sales growing 44 per cent. In the last financial year, the brand’s sales touched 78,500.
With the average cost of its bike being above Rs 1 lakh, Royal Enfield charges more than double the average cost of a two-wheeler sold in India, which is between Rs 50,000-60,000.
To keep the party going, the Chennai-based company on Thursday launched the all-new Thunderbird series with prices starting at Rs 1.43 lakh. While the 350cc variant is the base version, the technologically advanced 500cc comes at Rs 1.82 lakh.
The company expects to sell in excess of 1,000 units of the Thunderbird every month, with bookings beginning across all of its 237 country-wide showrooms. Perhaps the most unique feature of the bike is that it is available only in one shade, which is black.
Siddhartha Lal, MD & CEO of Eicher Motors, the parent company of Royal Enfield, says, “Ten years ago we came out with the Thunderbird which had the power for highway cruising and it became the sub-cult brand of the company. Two years ago we decided that we needed a new cruiser which could keep up with the changes of riding on the highway”.
The company has phased out the earlier generation Thunderbird and is presently allowing customers to upgrade to the new model.
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The company has three main models, Thunderbird, Classic and Bullet, which share a further 11 variants among themselves with engine size, features and technology being the defining factors. Classic is the top selling product followed by the Bullet and the Thunderbird.
Lal is eager to add more products to the line and the company has already begun work on the same, but Royal Enfield finds itself handicapped on the production front.
Its decades-old factory in Chennai, where most of the production is done through use of manual labour, can produce just 10,000 Royal Enfields every month with engineers having done all they could to squeeze out that one extra unit.
But that is set to change with Lal pinning his hopes on the modern upcoming plant in Oragadam, Chennai being built at a cost of Rs 350 crore. This new plant having a capacity of 150,000 units per annum would come up during the first quarter of next year.
By the end of 2013, Royal Enfield aims to produce 12,500 units per month from the new plant having a further option of doubling or tripling production, which should be enough to manage the increasing export demand – an area that is clearly the priority.
The company exports to 35-40 countries, including to the US where one of its Classic models costs $6,000 (Rs 312,000) or more than double the India price.
“Clearly, the future is going to be different with new models and new geographies. In the larger scheme of things, we are clear that we want to be a global brand and a lot of the work we are doing currently is towards that. Well over 90 per cent of our current production is routed to India. That will change in three to four years, Lal says.
Beyond 2013, the company intends to use the existing plant as a feeder plant where only the engines will be made while the new plant will take over the painting and assembly operations.
No manufacturer in India makes products that could compete directly with the Royal Enfield range. Most have divided focus on the small capacity commuter segment and the high capacity sport segment. That’s enough for Lal to say, “When the motorcycle industry was growing for 15 years, we did not grow at all. Now it is our turn”.