Royal En­field Over­takes Yamaha in Sales

With a 53% jump in sales in FY16, the Eicher Mo­tors-owned co joins the top 5 in mar­ket share

The Economic Times - - Companies - J.Srikant@ times­

New Delhi: Royal En­field has been the fastest grow­ing mo­tor­cy­cle maker in the country in re­cent years and has now over­taken Yamaha Mo­tor to join the top five in mar­ket share. Eicher Mo­tors-owned Royal En­field sold a 498,791 mo­tor­cy­cles in the do­mes­tic mar­ket 2015-16, 53% more than the pre­vi­ous year’s sales of 324,055 bikes.

Yamaha In­dia, how­ever, saw its mo­tor­cy­cle sales slip 4.4% year on year to 332,958 in the last fis­cal. Its pres­ence in scooter seg­ment has helped Yamaha In­dia stay ahead of Royal En­field in the en­tire two-wheeler mar­ket.

Royal En­field is the only mo­tor­cy­cle maker in the top five that recorded dou­ble-digit sales growth last fis­cal. Mar­ket leader HeroMoto Corp and third-placed Honda Mo­tor­cy­cle & Scooter In­dia re­ported a fall in sales while Ba­jaj Auto and TVS Mo­tor grew less than 8%.

“Their strat­egy to fo­cus on niche seg­ments, and not go into mass mar­ket has re­ally paid off. If you look at it, Royal En­field has been able to cre­ate not only prod­ucts for the mar­ket, but also the mar­ket it­self for those prod­ucts. They have cre­ated a cult for bik­ing in In­dia,” said Ra­jeev Singh, au­to­mo­tive head at KPMG in In­dia.

Royal En­field’s vol­ume sales grew by more than 50% in each of the past four years, and to keep up with the growth in de­mand it is in the process of set­ting up a third plant near Ora­gadam in the out­skirts of Chen­nai. The new plant will in­crease its pro­duc­tion ca­pac­ity to 900,000 by 2018. The Chen­nai-based com­pany has been look­ing to ex­pand its in­ter­na­tional pres­ence as well. Last year it ac­quired UK-based high-per­for­mance mo­tor­cy­cle chas­sis and com­po­nents maker Har­ris Per­for­mance and Sid­dhartha Lal, CEO of Eicher Mo­tors, even moved to Lon­don. Also, in the last year, Royal En­field has en­tered Thai­land, opened sales sub­sidiary in the US, and started exclusive re­tail stores in France and Spain. It has more than 400 deal­er­ships and 10 exclusive brand stores over­seas.

In In­dia, the com­pany re­cently launched 410 cc ad­ven­ture tourer Hi­malayan to en­ter a new seg­ment. Royal En­field now has Hi­malayan Elec­tra, Clas­sic, Thun­der­bird and Stan­dard in its port­fo­lio.

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