The Indian bike manufacturer Royal Enfield has recently started commercial production from its new manufacturing plant located at Vallam Vadagal near Chennai. It has been stated by the manufacturer company that the Vallam Vadagal plant, which is spread across 50 acres, will manufacture Royal Enfield motorcycles for India as well as international markets.
Royal Enfield, the Chennai-headquartered bike maker company, is a division of Eicher Motors and it earlier had two manufacturing plants in Chennai. In the period 2016-17, the company had produced a total 667,135 motorcycles and all were sold, nearing its nominal capacity. The new plant will get an installed production capacity of 300,00 units per annum in its first phase. With the third plant coming onstream, the company has intended to increase the production rate up to 8.25 lakh units in FY18 from the combined production of all the three plants.
The plot for the setup of new manufacturing plant was acquired by the company in 2014 and it was built and made ready on time according to the company’s plan. The surge in the demand for the Royal Enfield motorcycles globally has urged the bike maker to increase the production rate, which made way for the new plant installation. The new facility will certainly help in the further growth of the company to meet the market demands and will further consolidate its position globally.
The company is further looking into the development aspect of its current position by investing an amount of Rs. 800 crore to increase the capacity at the new plant. Royal Enfield is planning to introduce new products in its line-up, based on new platforms and is planning to further improve the technical centres at Leicester in UK and Chennai in India. This huge investment from the company will be fund-raised through internal accruals.