Royal Enfield sets up Thailand assembly unit

New Delhi: Royal Enfield, India’s biggest middle-weight premium motorcycle maker, is forming a wholly owned subsidiary in Thailand and setting up its first assembly plant, the firm announced on Friday.

The plant marks a significant step by the Eicher Motors Ltd-owned company to establish itself on the global stage and have manufacturing bases in different locations to gain flexibility in production. The new production line will be Royal Enfield’s first outside India and the subsidiary will be its first in the Asia-Pacific region.

The Siddhartha Lal-led firm has been trying to create a niche for itself in the global stage, especially in South-East Asia, Western Europe, and North America after establishing itself as a clear market leader in the premium middleweight category in India.

This will be its second significant capital expenditure outside India after its investment in setting up a technical centre in the UK. Thailand has become Royal Enfield’s third home after the UK, where it originated, and India, according to Lal, managing director and chief executive, Eicher Motors Ltd. The initial success of the 650 twins in Thailand has proven that Royal Enfield is poised to fill the gap in mid-size segment.

“With a massive segment of commuters ready to upgrade and a robust long-distance, leisure riding culture in the country, Thailand offers huge headroom for growth for Royal Enfield. We believe that localising our operations in Thailand will allow us to serve our customers at a closer and more intimate level,” said Lal.

This new facility will also help the company export its bikes to countries that have a free trade agreements (FTA) with Thailand, at a time when the company is looking to cover the developed and developing markets with products manufactured in India.

Thailand was one of the first markets in which the company launched its new products, Interceptor 650 and Continental GT 650 twins. Since their unveiling in December, 2018, the 650 twins have got more than 700 bookings and over 100 motorcycles have been delivered till date, said the company.

“Royal Enfield started with one store in Bangkok, which has been instrumental in helping us understand this market. We have an aggressive plan to expand our reach to about 15 stand-alone dealers and 25 authorized service centres by March 2020. The expanded reach will offer customers better accessibility and convenience in Bangkok and the Greater Bangkok area, Phuket, Pattaya and Chiang Mai,” said Vimal Sumbly, head of business, Apac region.