In motorcycle culture around the world, the Harley-Davidson brand is a touchstone. It represents quality and status to bikers with both new and recycled bikes, who swear by the company and their offerings, proudly wearing their logo emblazoned on shirts, patches, equipment and more. Last year, however, a lesser known brand out of India took the wind out of their sails by outdoing the major manufacturer in unit sales.
Royal Enfield is not a new name to dedicated bikers, but it doesn’t carry nearly the weight of the Harley-Davidson name to most consumers. Regardless, the company was launched in 1901 England, but is currently owned by Indian commercial vehicle and bus manufacturer Eicher Motors. Production of the bikes moved to India in 1970, and the company has thrived there since.
Why the Shift?
In 2014, Harley-Davidson sold 267,999 units- in comparison, Royal Enfield exceeded 300,000 units in sales. Auto economists have several theories about why that might be the case. Production of automotives in India requires less overhead spending, which leads to a significant price difference between Royal Enfield’s offerings and those of Harley-Davidson. The cheapest Harley-Davidson on the market is twice as expensive as the most top of the line Royal Enfield bike available.
In addition to that, motorcycle riding as a leisure activity and hobby has been rapidly growing in popularity within India. Travel networks in India have improved drastically over the past 10 years, making the use of motorcycles much safer and more pleasant than it once would have been. India is a highly populated nation, so as the percentage of motorcycle hobbyists grows, so does the demand for inexpensive, well made bikes.
Finally, another conclusion that can be drawn is that increased visibility of the Royal Enfield brand among motorcycle hobbyists is creating a fan base that expands beyond India. Lower purchase prices may attract international bike collectors who are looking to create a diverse and esoteric collection.
The brand’s powerful selling ability is definitely something new to note. In 2013, Harley-Davidson was still outselling Royal Ensfield by more than 100,000 units. The steep increase in sales has led the Indian manufacturer to plan an investment of $80 million dollars in two new factories with the intent of manufacturing 450,000 motorcycles in 2015. With the company having earned $482 million last year, a record figure, they have the room to expand. Technology centers are also being planned.
Promoting their bikes as an element of adventure has proven to be a draw to bikers in India and beyond. Consumers are clamoring to purchase the manufacturer’s popular Bullet bike, a midsize offering with a sleek vintage-styled frame, seen in the nation’s Republic Day parade. This appearance drew a remark of approval from American leader Barack Obama. Buyers looking to purchase a Bullet bike by Royal Enfield would do well to be patient, as the current waiting period to buy the popular bike is approximately one year. It is safe to say that the rapidly growing manufacturer is well on their way to achieving their goal of dominating the global mid-sized motorcycle market.