Royal Enfield gets land for new plant near Chennai

Royal Enfield Motors, the two-wheeler division of Delhi-based Eicher Motors, said on Tuesday it will set up a new manufacturing facility at Oragadam near Chennai, with an initial installed capacity of 1.5 lakh units per annum, which will be on stream by March 2013.

The proposed 50-acre facility is likely to see a total investment of up to Rs350 crore over the next five years. Tamil Nadu chief minister J Jayalalithaa on Tuesday allotted land for construction of the plant at the Oragadam SIPCOT Industrial Park. It expects to directly employ some 300 people.

"We have received the letter granting the land from the state government. We will start construction immediately after getting possession. We should be ready with the plant by the first quarter of 2013," said Eicher Motors chairman and managing director Siddhartha Lal in Chennai.

Royal Enfield, which makes the technologically dated but still iconic Bullet motorcycle, has been facing supply constraints at its existing production unit at Thiruvottiyur near Chennai as sales are growing strongly.

Royal Enfield has been recording a 40-per cent rise in sales every month during this calendar year.

The company has been gradually ramping up the production capacity at its Thiruvottiyur plant to meet the increasing demand. However, the waiting period for its products continues to be very long.