Royal Enfield has ended FY18-19 at marginal growth of 1 percent at 8,26,098 units, up from 8,20,492 units sold in FY17-18. Of this exports stood at 20,825 units, up 8 percent from 19,262 units. Domestic sales were up marginally for the period at 8,05,273 units, up from 8,01,230 units.
For March 2019, sales decline is reported at 21 percent, down at 58,434 units from 74,209 units sold in March 2018. Exports for the month is up 28 percent at 2,397 units sold, up from 1,878 units. Total sales for the month is down at 20 percent, down to 60,831 units from 76,087 units sold in March 2018.
For the FY ended, Royal Enfield had cut its production twice, first by 25k units, and by a further 50k. As such total FY19 target was reduced to 8.75 lakh units from 9.50 lakh units. Production slowdown has been attributed to the labour strike at the company’s plant, overall slow sales and inventory pile-up.
Royal Enfield’s sales stagnation is in tune with current market patterns that has contracted owing to low buyer sentiment, and the period of gloom is expected to continue in the months to come. Royal Enfield is now working on its first wholly-owned subsidiary in the Asia Pacific region. The Thailand plant begins its journey as the first assembly plant for the company outside India, and is set to begin ops in June 2019.
For FY19-20, Eicher Motors has announced a 700 crore capital expenditure plan for Royal Enfield. The capex spending will be on RE’s Technology Centre, and Vallam Vadagal plant phase II construction, and for development of new platforms and products. Alongside, the company will focus on compliancy to BS-VI emission norms and in strengthening product development capabilities. For 2019-20, Royal Enfield plans production at 9,50,000 motorcycles.
Eicher Motors Ltd (EML) also announced the appointment of Vinod K. Dasari as the Chief Executive Officer (CEO) of Royal Enfield. He joins the Eicher Motors Ltd Board as Executive Director. He takes over from Siddhartha Lal, who continues as MD of Eicher Motors, and will continue to support Vinod and the team on product and brand related areas.
