Royal Enfield to expand capacity; Eicher to invest Rs. 600 cr

Eicher Motors Ltd., is gearing up to invest an additional sum of Rs. 600 crore over a period of two years in its motorcycle division, Royal Enfield. The investment is expected to help increase the company's annual production capacity and aid the development of global product platforms.

Royal Enfield aims to produce more than 2,80,000 bikes in 2014. The company also plans to maximise the production at its Oragadum plant near Chennai, which will take the company's total annual production to over 5,00,000 units by the end of 2016. The increase in capacity is expected to help reduce the waiting period for the delivery of its motorcycles.

Royal Enfield registered sales of 1,78,121 units for the calendar year 2013, up 57.03 % from 1,13,432 units in calendar year 2012. Additionally, the company sold 4,400 high end motorcycles in international markets.

The company also plans to step up its efforts to develop bikes in the 250 cc - 750 cc range over the next five to seven years. These bikes will be aimed at international markets, particularly the US and UK and target a clientele in the 50 plus age group.