Second Coming of Royal Enfiled

Strategy Management Project

Revival of Enfield

Second coming of Royal Enfiled

“Less of more is a big mantra in Royal Enfield, the idea is to do more and more for every aspect of business—less number of models but more energy behind each one of them, less number of market but do them better. Do few things but do it really well”: Siddharth Lal

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Over the last three years, Royal Enfield has nearly quadrupled its sales. To make it sound even more impressive, REML’s sales in 2015 were nine times its sales in FY 2008. This is a CAGR of 36.87% over the last seven years and a CAGR of 60.39% over the last three years. That is impressive by any account, especially for an industry which has grown at only 12.55% in the same period. The year 2000 could have been decisive. That was when the board of directors at Eicher Motors decided to either shut down or sell off Royal Enfield - the company's Chennai-based motorcycle division, which manufactured the iconic Bullet motorbikes. For all its reputation, the sales of the bike was down to 2,000 units a month against the plant's installed capacity of 6,000. It was when Siddharth Lal took reigns and decided to divest in 13 out of 15 businesses and focused on motorcycle and truck segment.

According to R L Ravichandran: “The real reason for people buying the Bullet is the passion for the brand not speed, pricing, discount or mileage”. Siddhartha Lal has provided a vision for Royal Enfield in the process, he just wanted to focus on the leisure biking segment and wanted to be a leader in the mid-weight segment. 

Strategy Diamond Model for Royal Enfield

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How did TVS establish itself amongst the giants?

At 14 million units, the Indian two-wheeler market is the largest in the world, growing at a CAGR of 14 per cent over (volume) over the last five years. Working to its advantage are factors like India's large population, a favourable 'young' demographic profile, underdeveloped public transport systems and strong replacement demand, as per an ICRA Research report.