Royal Enfield planning a new plant in Andhra Pradesh

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Eicher Motors, the parent company of Royal Enfield planning to set up a plant in Andhra Pradesh to manufacture its motorcycles. The company is reported to have started talks with the government of Andhra Pradesh. The incentives offered by the Andhra government, if any, however, are still not known.

Sri City, a new SEZ at Satyavedu in Chittoor district has been identified by RE as the preferred investment location. The company is said to be planning a Rs 250 crore investment for the new plant. The investment will be made in two phases. First phase will see the company’s production capacity going up by 1.5 lakh bikes per annum, and when the second phase get completed two years later, the capacity will go up by another 1 lakh units. Rs 150 crore will be invested in the first phase while the remaining 100 crores will be spent in the second phase.

The new plant is an absolute must for RE which is currently reeling under pressure to cater to the high demand for its motorcycles. Royal Enfield is currently producing its motorcycles at its Chennai plant, which has an installed capacity of close to 39,000 units per annum.

The more important new for the enthusiasts is that the investments will also include Rs 70 crore for new product toolings, which will be meant for the development of new products. This means that the company will come out with new products once the new plant is functional.

Hope to see some hot new REs thumping on the road soon then…

Source : DNA India

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