Royal Enfield to launch new-engine model

By Venkatachari Jagannathan | 21 May 2007

Chennai: The Rs198.36-rore revenue Royal Enfield, the motorcycle division of Eicher Motors Limited, plans to launch a motorcycle fitted with a unit construction engine or an integrated engine sometime this year. Anupam Thareja, director, says the division would initially launch a 350cc bike fitted with the new engine.

Royal Enfield has been working on different engine platforms for the past two years and has developed a iron-cast as well as lean-burn aluminum cast engines. In addition, the new unit construction engine will also form part of its portfolio. In terms of gearshifts, the division has four-speed and five-speed gears. The division is rolling out all its new models with the gearshift on the left, a marked departure from its earlier Bullet models, which had their gearshifts on the right.

Thareja says, "This is the same engine chassis configuration that Royal Enfield has earlier been exporting to Europe, the US, and Australia where we have been seeing a constant increase in demand."

The new engine and the shifting of the gear is part of the resurgence that is happening at the Chennai-based Royal Enfield. The division has new heads for various functions, including CEO R L Ravichandran, an old TVS Motors hand, who joined two years ago from Bajaj Auto Limited.

With the market for its models booming, Royal Enfield launched its export model, the Machismo 500, in the domestic market but has restricted the annual supply to 500 units to curtail exports by individuals, resulting in price distortion in the overseas markets.

"The model will be available only at our brand stores and the vehicle will be selectively sold," says Thareja.

Priced at Rs1.05 lakh in Chennai, Machismo 500 features an aluminum cast lean-burn engine, 19-inch wheel glide, 280mm front disc brakes and a torque of 3000 rpm. Thareja says, "In Bangalore alone the bookings is around 70 units."

He said the division will be expanding its capacity by 4000 units adding some balancing equipments during the current year. "Next year we will be expanding the capacity in a big way," he added. However, he declined to give any specific numbers as to the capacity volume or the value of investments for increasing the production facility.

Last fiscal the division had sold 33,000 units logging an increase of 2000 units over the previous year. For the current year the division hopes to sell anything between 36000-40000 units. "The demand is good and dealers are not laden with inventory," Thareja claimed.

Speaking about exports he said the division ships out around 10 per cent of the total sales and for the current year the target is 3600 units.

During the year, Royal Enfield plans to add four more brand stores taking the total to 11. The long-term plan is to have 20 such stores across the country. According to Thareja, Royal Enfield has taken a serious view of the servicing complaints and it setting its house as well that of the dealer''s right. The division has around 110 dealers now.

When queried about the plans to hive the two wheelers division into a separate company and also inviting a strategic investor, he said, "The plans are under consideration."


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