All regional offices in Gurgaon, Chennai, Bangalore, Mumbai, Jharkhand, Hyderabad and Bhubaneshwar been shut with immediate effect
As the COVID-19 pandemic escalates across India and as a part of the cost cutting initiative due to lower sales arising there from, Royal Enfield has decided to shut down over a dozen regional offices across the country. A circular to this effect has already been sent out to the employees citing these reasons for closure.
The regional offices being shut down in Gurgaon, Chennai, Bangalore, Mumbai, Jharkhand, Hyderabad and Bhubaneshwar are among others across India. All sales and service personnel will follow a work from home regiment as per orders issued by the company on Friday post the announcement of the company’s March quarter results. Sales in the March quarter were down 17 percent to 1,63,083 units when compared to sales in the same period of the previous year.
The company has posted a 44 percent decrease in profits due to the coronavirus effect which has had a devastating effect not only on Royal Enfield sales and profits but on every two and four wheeler manufacturer in the country. The shutting down of offices will see all employees working from home, cutting down travel time, rents and other overheads.
May 2020 sales of the company dipped to 18,49 units, a de-growth of 69 percent as against 60,211 units sold in May 2019 while exports stood at 684 units in the past month, down from 2,160 units exported in May 2019. The company expects June sales to pick up as some of the lockdown rules have been relaxed and also predicts that sales figures should see steady growth in the next quarter.
Royal Enfield is all set to launch a range of new products in the months ahead. The first such product will be the Meteor 350, which will launch in July. This bike is set to take the place of Royal Enfield Thunderbird. It will be positioned on a new platform and will receive a new engine and transmission. It is expected to be powered by a BS6 350cc single cylinder engine.
In the meantime, Royal Enfield has also embarked on the studio store concept. This is a service shop cum showrooms spread over a 500-600 sq ft area. It operates at one tenth the cost of a regular showroom or workshop and is a part of the company’s cost cutting factors with a presence in smaller towns and Tier III markets.