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The new unit at Vallam Vadagal near Chennai, Tamil Nadu, India is spread over 50 acres, and is the company’s third manufacturing facility. It will manufacture Royal Enfield Motorcycles for India and markets abroad.
Work to set up the facility commenced 15 months back and will enable the company to meet its high targets for growth.
In phase 1, the state-of-the-art plant will function with an installed production capacity of 300,000 Motorcycles. In FY2017-18, combined output will be 8,25,000 units. In FY2016-17, the company manufactured and sold 6,67,135 motorcycles (almost its installed capacity).
The company’s sales have seen a compounded growth rate of over 55 percent over the past six years. In FY2017-18, the company intends to invest Rs 800 crore, largely towards expansion of capacity at Vallam Vadagal, new products and platforms, and setting up of technical centres in Leicester, UK and Chennai, India.
The plan to expand capacity is also part of the company’s strategy to prepare itself to face competition.