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Royal Enfield Sets Out For World Domination

By May 20, 2013General Posts

The Indian maker of Royal Enfield, the World War II-era British motorcycle owned by stars including Brad Pitt, plans to export the vehicles to Southeast Asia and Latin America as it builds on record sales at home.

Eicher Motors Ltd. (EIM) is predicting more demand in emerging markets for mid-sized bikes with an engine capacity of 250 to 650 cubic centimeters as people become more affluent, Managing Director Siddhartha Lal said in an interview. Eicher, which acquired control of Enfield India in 1993 and revived the almost-bankrupt unit, is seeking to increase the share of revenue from two-wheelers from 16 percent of the $1.2 billion it reported in the year to Dec. 31, 2012, he said.

“Mid-sized bikes are ideal for these markets as they are reasonably fuel-efficient, maneuverable and not too much more expensive,” Lal said in his office located in Eicher’s glass and steel headquarters in Gurgaon near New Delhi. “There are markets that aren’t conducive to big bikes and the mid-sized market is underserved.”

The company is planning to expand the motorcycle business after reporting the best quarter at its Enfield unit, where sales rose 45 percent in the three months ended March 31. Eicher, which earns the remaining 84 percent of its revenue from trucks it makes in partnership with Volvo AB (VOLVB), said a key gauge of its profitability beat all local rivals in 2012 amid the slowest pace of economic growth in a decade.

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