Royal Enfield subsidiary due in March

Royal Enfield subsidiary due in March

Thai preference for easy riders noted

Mr Sumbly, on the Indian-made Interceptor INT 650, says Royal Enfield is looking into the feasibility of expanding its first production facility outside India.
Mr Sumbly, on the Indian-made Interceptor INT 650, says Royal Enfield is looking into the feasibility of expanding its first production facility outside India.

Royal Enfield, the manufacturer of classic motorcycles, expects to establish a subsidiary in Thailand by March 2019.

Following the US and Brazil, Thailand is the third country where Royal Enfield has chosen to build a local subsidiary.

Vimal Sumbly, head of business markets in Asia-Pacific, said the expansion has progressed as Royal Enfield planned.

"Our network, sales and after-sales service will be localised operations here," he said.

"Thailand is such a great potential market for Royal Enfield as market sentiments favour easy-riding motorcycles."

Citing the latest figures from the Land Transport Department, Thailand's motorcycle registration stood at 1.506 million units over the first 10 months, a 1.36% drop from the same period last year.

But Mr Sumbly said the local mid-sized segment of 250-750cc is expected to grow by 8% to 51,000 motorcycles this year, towards which Royal Enfield is marketing globally.

He said Royal Enfield's registrations from January to October stood at 1,356 units, up sharply 41% year-on-year.

"As a result of this local sentiment, we expect to sell 1,500 units this year. We also expect to benefit from expanding Royal Enfield's network to 12-15 locations over the next couple of years, up from three locations," said Mr Sumbly.

Royal Enfield entered Thailand in late 2015 and appointed General Auto Supply Co as its first Thai distributor.

In 2016, Royal Enfield sold 1,039 motorcycles here, and 1,133 in 2017, according to the Land Transport Department.

Royal Enfield has three flagship outlets -- two in Bangkok's Thong Lor and Vibhavadi Rangsit roads and one outlet in Chiang Mai.

For the Asia-Pacific region, Mr Sumbly said Royal Enfield is keen on many countries in the region, led by Thailand, Indonesia, Australia, Malaysia and Vietnam.

"We are working on establishing a local subsidiary in Indonesia, which is the second-largest market in Asia-Pacific with 900 units sold a year," he said.

Total sales in this region stand at 5,000-6,000 units annually.

Mr Sumbly said Royal Enfield is also looking into the feasibility of expanding its first overseas production facility outside India as it has a mission to expand the global footprint in major cities.

Royal Enfield motorcycles are produced in three factories in Chennai, India, with an annual production capacity of 950,000 motorcycles, supporting global markets.

The firm produced 825,000 motorcycles in the last fiscal year, ending in March, 95% of which were sold in India.

Overall mid-sized motorcycles stand at 1.4 million sold worldwide.

"We are dominating this segment globally," said Mr Sumbly.

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