Royal Enfield, a popular Indian motorcycle brand, is getting worldwide acceptance among two-wheeler enthusiasts. As per a report by Nikkei Asian Review, a premier Japanese business newspaper, the sales of the company in Southeast Asia are rising so fast that it has decided to set up a manufacturing unit in Thailand.
“We are bringing our success from India into Thailand with the goal to be number one in the midsize motorcycle market in Thailand,” Royal Enfield CEO Siddhartha Lal said in a statement, referring to motorcycles in the 250 cc to 750 cc class.
The Royal Enfield brand was established in Britain back in 1901 but the parent company ceased to exist in the 1970s. The ownership of the Indian unit was purchased by Eicher Motors in 1994 and the company has successfully reestablished its brand value and market presence in the last two and a half decades.
Today it is among the most successful brands in mid-size motorcycles in India and is now expanding on the global stage. The sales in Southeast Asian and Latin American nations have gone up exponentially in the last few years, and encouraged by this, the company is setting up manufacturing units in those regions. Firstly the company established a manufacturing unit in Argentina to cater to the Latin American market and now a second overseas factory is being established in Thailand.
Sales in Thailand doubled to 3,146 units and expected to cross 4,000 in the next year. The initial production capacity of the Thailand manufacturing unit would be around 4,500-5,000, which is also the expected demand in the country for the next year.
The iconic brand has established a cult status among followers, just like Harley-Davidson in the United States, Ducati in Europe, and Yamaha, Honda in Japan. However, the popular European, American, and Japanese players have not been able to satisfy the demand of the developing nations, where people want good products at cheaper prices. And, this is where the Indian automobile industry chips in given the fact the consumer demand is the same in India and Indian automobile companies have excelled in making cheap and efficient two-wheelers in the last few years. “I think we have been gaining a greater customer base in Thailand due to our accessible prices and marketing events designed to create Royal Enfield’s [customer base] in Thailand,” said the company.
Thailand is the largest automobile manufacturer in Southeast Asia and the country has built an ecosystem for automobile manufacturers. The companies from countries around the world chose Thailand to manufacture automobiles to serve the demand in Southeast Asian nations and therefore, Eicher Motors, the owner of the Royal Enfield brand since 1994, has also decided to set up a manufacturing unit in the country.
Royal Enfield already has 36 showrooms in Thailand and has entered ASEAN countries including Vietnam, the Philippines, Malaysia and Indonesia with the aim to dominate the medium-sized motorcycles segment and cater to the consumer base which has been left untapped by American and Japanese manufacturers.
The export of Indian-made two-wheelers has grown in a double-digit growth rate in the last few decades and Indian companies like TVS, Eicher Motors, Bajaj, Yamaha and Mahindra are manufacturing two-wheelers for specific countries as per their needs. R Dilip, senior vice president – International Business, TVS Motors, said: “We export two-wheelers to more than 50 countries. To cater to the international market the vehicles are modified to suit the requirements of each country. The vehicles are made to cater to specific requirements such as road condition, quality of fuel and emission regulation.”
The automobile sector has the capacity to fulfill the Modi government’s “local se global” dream and the government must actively help companies like Eicher Motors to expand their global footprint.