Enfield roars back with record profits and a waiting list
The engine is much quieter now, the bikes more trendy, but last fiscal year, 119-year-old Royal Enfield made a noise louder than its quintessential Bullet has ever made. Sumant Banerji reports. Riding the Bulletautos Updated: Apr 22, 2012 22:33 IST
The engine is much quieter now, the bikes more trendy, but last fiscal year, 119-year-old Royal Enfield made a noise louder than its quintessential Bullet has ever made. The firm, which was in the red at the turn of the century, posted its highest sales growth ever in a year at over 44% to notch up sales of 78,546 units.
The first trick was the new age Classic series, which had a new, modern heart replacing the cast-iron engines of yore. The second trick seems to be the increased competition. Global leaders in cruiser bikes, Harley Davidson and Triumph, have forayed into India - but that has only increased demand for the original Indian cruiser. Waiting periods for the Classic 350 is 10-12 months in some states - a far cry from 2001, when there were discounts on the Bullet.
"There is a deep latent demand for Royal Enfield in India, almost like people want us to win," said Venki Padmanabhan, CEO, Royal Enfield. "Enfield has a long story in India and is embedded in the psyche of the people. We are finally delivering products that are smart, savvy and reliable... which is where people have at times been disappointed in the past. But now it is all falling in place."
Ironically, even competitors want Royal Enfield to do well. Harley Davidson sees a customer for its iconic bikes in every Enfield owner.
"The more bikes Enfield sells, the better it is for us," said a Harley Davidson dealer. "Many of our customers have Enfields... it is a natural progression for them. Enfield is like the Alto and will always sell more. But we make the Swift which every Alto owner wants to buy."
"We are an aspirational brand, waiting period is good for us," Padmanabhan said. "Consumers do not mind. It is discounts that kill a brand, we would never do that."
For the first time, Enfield is in demand in tough markets like the US, the home ground of Harley Davidson, as well.
"The appeal for cruisers is profoundly different in the US," Padmanabhan said. "They want powerful, robust bikes for long distance riding. We cannot give them that. But people like our pedigree - and the 80 miles to a gallon (mileage)."