Hike in price due to mandatory ABS and insurance has affected Royal Enfield sales.
Remember the last time Royal Enfield had to cut down production of its 2-wheelers in November 2018? Though that particular instance occurred due to the long labour strike at the company’s Oragadam production facility in Tamil Nadu, this time around, the matter pertains to declining demand.
Yes, Royal Enfield is looking to cut down production again as inventory is getting piled up and dealerships have almost all the models readily available. This production cut is likely to be for around 50,000 units.
There are several factors that contributed to Royal Enfield’s sales decline. The increase in the cost of insurance and price hike due to the mandatory ABS norm are big reasons behind the downward trend. However, some believe the reason could be the introduction of Jawa Motorcycles in the country. We at MotorBeam aren’t convinced as the number of bookings for Jawa haven’t been revealed and if the numbers were big enough, then the Mahindra owned brand would definitely have flaunted its numbers, like Mahindra did when they created hype in 2011 with the launch of their first monocoque SUV, the XUV500.
However, from the common man’s perspective, the competition from Jawa Motorcycles was such that the models were sold out even before the production roll out. And on a stark contrast, the best selling RE motorcycle, the Royal Enfield Classic 350, which had a waiting period of close to two months, is now readily available at almost all the dealerships.
In fact, one of the RE dealers has even mentioned that contrary to the past, the customers don’t need to book their motorcycles now. They just need to come over to the showroom and buy it without any such waiting period.
Royal Enfield Cuts Production
– Expected production cut is for 50,000 units
– Price hike due to insurance and ABS have caused a de-growth
– A negligible waiting period for Royal Enfield Classic 350 too