Royal Enfield

over-embellished Enfield brandmark Rejuvenation of Motor round of golf in India The form 2000 could view been decisive. That was when the board of directors at Eicher Motors decided to either closed down or sell off lofty Enfield the comp whatalwayss Chennai-based motorcycle division, which manufactured the iconic sens motor steering wheels. For completely its reputation, the sales of the cycle was down to 2,000 units a calendar month against the plants installed bonnetacity of 6,000 losses had been moun sound for courses. Just iodin person stood up to the board, insisting august Enfield should rule a nonher chance.He was Siddhartha Lal, a third generation extremity of the Delhi-based Lal family, promoters of the Eicher group of companies. Lal, then 26, was an unabashed Bullet buff he even rode a red colored Bullet while leading the baraat (procession) to his wedding venue, or else of the traditional horse. The board agreed to give me a chance, says Lal. It was non because of its confidence in me, but because the military control was doing so badly it could hardly get both worse. Lal felt Royal Enfield could still be saved. The motorcycle had its reputation, a cult following, an instantly recognisable build, and aspirational value.Changes had to be made to keep up with the times and determine the bike more than acceptable, and in that respect in redact the problem. Royal Enfield fans liked the bikes exactly the way they had incessantly been. We needed channelizes to attract tonic customers but by doing so risked losing existing ones, says R. L. Ravichandran, whom Lal brought in as chief executive officer in 2005 as part of his revival effort. Ravichandran had preceding worked with both TVS Motor and Bajaj Auto. We were in a particular(a) situation, he adds. Rejuvenating multiplication The change had to be a calibrated one.The mistaken notions of prospective customers had to be addressed, and any reservations about Bullet an d Thunderbird, which was launched in 2002, removed. At the same(p) time, Lal and Ravichandran were clear that the individuality of Royal Enfield bikes should not be compromised. We did not want to go down the commuter train route, but instead looked at the leisure segment, says Ravichandran. Retaining the bikes ruffianly looks was a given, including the build, the envision of the head lamp and the petrol tank. tho should the gears be shifted close to the riders left foot as in most bikes or retained on the right side?The question gave Lal and his team many an(prenominal) sleepless nights, since long time users were dead contrasted to the change. The locomotive engine was an new(prenominal) thorny question. The old ramble iron engine was a relic of the past. Its erupt gear box and oil sump design made it prone to oil leaks and it seized up real often. Its ability to meet increasingly strict electric arc norms was also suspect. A modern aluminium engine would eliminate the se problems, but it would lack the old engines pronounce vibrations and beat which Royal Enfield customers loved.Laws of physics made it unrealizable to replicate these with the new engine. The new engine had 30 per penny fewer parts and produced 30 per penny more power than the old, with better fuel efficiency. By 2010, all Royal Enfield models had begun to use the new engine. ii other problems needed to be addressed the fibre of some of the components Royal Enfield bikes were using, and the sales experience. The case is inclined(p) by Prof. Sanjay Patro and Aby Abraham, XLRI Jamshedpur for academic purpose only. It is not to illustrate either effective or unavailing handling of a business situation To accept the first, shop floor process were fine e ses e-tuned, whil suppliers w exhorte to le were ed improve qua ality levels. R Royal Enfield also embar d rked on a larg scale inter exercise to tone ge rnal e up performa ance. We de ecl bed 2006 as the year o acquiring bac to the bas of ck sics, says Ravichandra We also formed a fie timbre ra an. eld apid action fo to bridg the break bet orce ge tween customer expectations an the reality nd y. Slowly, the tide turned. E t Engine think problems and oil leaka ed ages in the b bikes were tackled first.By 2008 de ealers were report lo ower worklo oads in the workshops. Warranty c claims fell astutely too. Royal Enfi ield also beg conduct gan ting marquee rides to promote leisu bi poove. e ure Such step removed the fears abou our produc reliability some customers may h ut cts y have had, says Venki Padmanabh han, who su ucceeded R Ravichandran as CEO e n earlier this year after Ravichandra was eleva an ated to the b board of Eich Motors. To improve sales exper her e rience new expanded. company-ow wned sho owrooms were la aunched and dea alershipsIn October 2008, Roya Enfield lau al unched in G Germany its newly desig gned dcc standard mod revivify by J2, a del ed 1950 model Bullet wit the new eng ine. It was a success, th value fo its pe for erformance and fuel economy. Emboldened Lal launch it in In d, hed ndia in Nove ember 2009 initially as a 350 cc b bike, termsd at Rs 1. 20 lakh. This proved a hit too. Now, our capacit utilisation is ascorbic acid per t , ty n cent. Yet there is a six month waiting period for hs deliveries, says Venk We pla to doub our cap ki. an ble pacity soon to 1. 5 lak bikes. kh Changing T Times tally to industry body, the Soc ciety of India Automob Manufac an bile cturers, the In ndian twost l e wheeler industry is expected to pos an annual enhanceth of 11-12 per cent, and the market is expected to double ever four years till 2020. A ry s According to data from Nomura and Crisil, as o d 0 wo-wheelers were sold in India 20 011-12. Vehi icles in the executive many as 10 meg tw segment form the bulk of sales at 6. 5 million, f med k 6 followed by the economy segment (1. 8 million) y and superior segment (1 million). m 1. The recent series o f hike up in the price of petrol h s es have played a profound role in the sa of twoale wheelers, ac ccording to S SIAM, as mo first-time four-wheel buyers in rural India and score II ost e ler n and tier trinity c cities have d deferred their purchases. Two-wheelers account for a very h high(prenominal) 76 per cent of mar rket sh are in the autom n busy sector in Asias third-largest economy. Passenger r t vehicles account for 16. 2 per cent. 25 According to a recent H t military man Deve elopment Re eport by UN NDP, India i one of the youngest is e nations with the median age being 29 yrs by the year 2020.A the pene h And etration figur of 35% res urban and 1 14% rural in ndicates that there going to be a per g riod of grow in the tw wheeler wth wo market. Challenging Times g The compet tition in high cc two wheeler seg her gment is stir up ting up. Bajaj (Pulsar 35 NS, Rs 50 1. 75 lakh), Yamaha (Sp ports bike F FZ1, a 998cc motorcycle, at a price tag of Rs 8. 7 lakh), c e Kawasaki N Ninja 650, etc are burning the rubber t enchant In c g to ndian youths. 2 Rajiv Bajaj, Managing theatre director of Bajaj Auto, the 2nd Largest Motor cycle manufacturing Company of India, express We have recognized the different needs of the customers of our high end bikes.To cater to these needs we have naturalised separate stores called as Bajaj Probiking Showrooms at in the major cities across the sylvan. The Kawasaki Bajaj Ninja is available exclusively through Probiking Showrooms. Bajaj has coupled hands with KTM of Austria a bike manufacturer since 1934 and has brought higher end motorcycles in India under the brand KTM Duke. battler Moto Corp after separation of its ties with Honda has become more aggressive. Honda charting out its solo journey wants to bring the topper of the world to one of the fasted growing market of India. These are the few competitors to name.Many more will follow. Entry of Harley Davidson into India added new flavour to the higher end segment. HarleyDavidson India commenced operations in August 2009 and appointed the first dealership in July 2010. Since early 2011, Harley-Davidson has been assembling motorcycles in India at its CKD (Completely-Knocked-Down) gather unit at Bawal in Haryana. India is the second country where Harley-Davidson has CKD assembly operations outside the US, after Brazil. Harley-Davidson currently offers a range of 14 models from each of its 5 families Sportster, Dyna, Softail, V-Rod and Touring.Each of the five Harley-Davidson motorcycle families boasts of a distinct causa and caters to the varied sensibilities of the broad range of customers. Road earlier Siddharth Lal observed that it grew at 42% and could sell 74,626 bikes during the year 2011. Venki is excited about the fact that demand has more than doubled and Enfield can supply and he is not bothered about the market share figures as they see themselves in a different league. In his words it is more about the context of th e crossing, the product-market . Royal Enfield is a leisure brand that it enables customer to enjoy leisure. It is an involving and engaging motor cycle . The bike demands for continued caring kind of fundamental interaction from its riders that leads them to develop a emotional bond. Today, Royal Enfields problems are of a different kind. It needs to scale up without diluting brand equity. From being the most expensive bike on Indian roads, today it faces challenges from iconic planetary brands such as Harley-Davidson which has entered the Indian market. With other competitors getting battle ready,how can it hold on to customers through the waiting period of six to eight months.Driving change when the chips are down is easy, when there is no other option. In Royal Enfields case the? What would be your recommendations to Mr. Venki Padmamnabhan, CEO, with image to its future roadmap, Product strategy, Brand Management / intricacy and Marketing strategy? 3 Exhibit 1 Production figu res for 2012 Jan-12 Hero Motocorp Ltd. 458848 7303 Royal Enfield 76 Harley Davids Feb-12 479927 8005 116 Mar-12 502208 9004 104 Apr-12 485325 9013 104 May-12 515627 9256 nose candy Jun-12 517848 9265 74 Jul-12 469951 10057 90 Aug-12 401194 10237 86 Sep-12 367869 10255 87 Oct-12 426307 10606 78Exhibit 2 Harley Davidson Bikes cost list India Harley Davidson Super Low equipment casualty In India 5. 5 lakh Harley Davidson IRON 883 determine In India 6. 5 lakh Harley Davidson 883 Roadster equipment casualty in India 7. 5 lakh Harley Davidson Forty-Eight harm In India 8. 5 lakh Harley Davidson Nightster cost In India 9. 95 lakh Harley Davidson XR1200x Price In India 11. 95 lakh Harley Davidson highroad bob Price In India 13. 95 lakh Harley Davidson Super Glide usage Price In India 15. 45 lakh Harley Davidson eke out Boy Price In India 19. 2 lakh Harley Davidson FLSTFB Fat boy Special Price In India 19. lakh Harley Davidson Haritage softail classic Price In India 20. 2 lakh Harley Davidson Night ROD Special Price In India 19. 55 lakh Harley Davidson Road king Price In India 22. 45 lakh Harley Davidson Street glide Price In India 24. 2 lakh Harley Davidson CVO ultra classic electra glide Price 34. 95 lakh Exhibit 3 Royal Enfield Bikes Price List in India 2012 Royal Enfield Classic chromium-plate 1,67,000 Royal Enfield Desert Storm 1,57,000 Royal Enfield Electra 5 S 69,000 Royal Enfield Bullet viosterol Classic 1,23,000 Royal Enfield Thunderbird K.S. 89,000 Royal Enfield Bullet 350 ES 85,600 Royal Enfield Machismo 350 78,000 Royal Enfield Electra 4 S 93,100 Royal Enfield Machismo 500 1,04,000 Royal Enfield Thunderbird S. S 1,07,000 Royal Enfield Bullet 350 UCE Rs. 99,500 Royal Enfield Electra Twinspark ES Rs. 1,11,000 Royal Enfield Electra Twinspark KS Rs. 1,07,000 Royal Enfield Thunderbird Twinspark Rs. 1,16,000 Royal Enfield Thunderbird 500 Rs. 1,66,000 4 -2 l Exhibit- Bajaj Driving the Power rotary motion with Pulsar 5 Exhibi t 3 Harley Davidsons Advertisements in india t 6