Royal Enfield, maker of the iconic Bullet bikes in India, said it has set up its first operating direct distribution subsidiary outside India, in North America.
Setting up a direct distribution company in Milwaukee, Wisconsin is expected to boost sales of Enfield models in the US and Canada.
It will also launch a fully-branded retail store in Milwaukee that will retail its entire product line-up of motorcycles and gear.
Over the next 18 months, the company plans to launch several such stores in key metropolitan areas across the US.
Among the models it will sell in the North America are Bullet 500cc, Classic 500cc and the Continental GT 535cc cafe racer and they will be priced between $4,995 and $5,995.
Enfield will be targeting the ‘mid size’ segment that is placed between the high-end Harley Davidsons and Indians on the one end and the regular, 200 cc bikes on the other.
“North America is a key international market for Royal Enfield, with a rich history of riding enthusiasts. Given the lack of attractive options in the mid-size segment, we are well poised to fill the gap and serve potential customers at a close, intimate level by localising our operations in North America,” said Rudratej Singh, President, Royal Enfield.
The subsidiary will directly sell to dealers and even to customers as well as directly conduct all market development and support activities such as marketing, service, aftersales etc for the brand in North America.
It is also focusing on building a strong independent dealer network. Current distributor Classic Motor Works (CMW), located in Fairbault, MN will no longer distribute Royal Enfield motorcycles by the end of 2015.
Royal Enfield North America will be led by President Rod Copes, and will oversee the company’s marketing, communications, sales, warranty, service, dealership development and finance in the region.
“American riders are looking for machines that are easy to own and maintain, (and) Royal Enfield offers evocative and unintimidating modern classic motorcycles, with timeless appeal,” said Copes.
All manufacturing will continue to remain in Chennai, Tamil Nadu, India where Royal Enfield has been manufacturing since 1955. Global headquarters will continue to reside in Gurgaon, Haryana, India.
Royal Enfield has seen a sort of revival in India in recent years. Sales are currently growing at around 50% year on year.
“This strategic announcement is in line with Royal Enfield’s focused international thrust of leading and expanding the global mid-sized motorcycle segment (250-750cc), with North America representing a priority market for the company.”
Royal Enfield is the oldest motorcycle brand in continuous production, with roots dating back to 1901 in Redditch, England. The bikes resemble the original motorcycles that were popular in Britain back in the 1940s and 50s.
Royal Enfield has been exporting motorcycles to North America for 15 years through an independant distributor.
“Royal Enfield has been growing at over 50% year-on-year for the last five years,” said Rudratej Singh added. “The combination of an efficient and scalable business model and brand love has given us our success in India. We have also grown the mid-size segment in India along with us. We see a clear opportunity to be able to do this globally as well.”
Mr. Siddhartha Lal, CEO, Royal Enfield said, “Our motorcycles are inspired by the classic bikes throughout motorcycling history, in form and in simplicity; and they capture the feeling of freedom, fun and responsiveness that riders were trying to achieve then, and brings it into the modern context. Royal Enfields are possibly the most engaging mid-size motorcycles out there. We use traditional craftsmanship and modern technology as a means to achieve the perfect balance between the rider, the machine and the terrain.”
In 2014, Royal Enfield sold more than 300,000 motorcycles globally.
Parent company, Eicher Motors Ltd., recorded its highest ever total revenue of $1.4 billion USD, with large contributions from the Royal Enfield business unit. In 2015, the company aims to produce 450,000 motorcycles to support its growth strategy globally.
With 50% growth every year for the last 5 years, Royal Enfield is fast becoming a very important player in the global mid-sized motorcycle market and is working towards re-inventing this space with motorcycles that are evocative and engaging and great fun to ride.
Royal Enfield operates through 16 company operated stores and more than 400 dealers in all major cities and towns in India, and exports to over 50 countries across the world including the USA, Japan, UK, several European and Latin American countries, as well as the Middle East and South Asia. Royal Enfield also organizes and supports many motorcycling events and rides on a global scale.