Royal Enfield has been dominating the premium segment for decades together and is very successful in its attempts to record over 30% operating margin till FY2018, showing the vast margins the company holds on its products. By the end of FY2020 the Siddhartha Lal company will have a market share of about 97% keeping the dominance firm in the segment.
India’s premium middle-weight bike segment is going to witness quite a competition in the next two years. With the number of motorcycle manufacturers like Bajaj, Honda Motorcycle, and Hero MotoCorp eyeing to get into the 300cc segment. With the high demand in motorcycles and growth in the commuter category in the urban market, the companies are planning to get into the higher segment to increase profitability.
Honda Motorcycle and Scooter India is India’s second-largest two-wheeler manufacturer that announced on September 30th that it would be entering the middle-weight segment with a motorcycle launch called the Highness CB 350. The firm’s newest offering will battle with market novelty Royal Enfield’s Classic 350, including other products in the segment.
Bajaj Auto, the Pune based company and Britain’s Triumph Motorcycles in 2019 established a non-equity shared venture to produce 300-700 cc motorcycles which will be launching in the market by 2012. Triumph Motorcycles is looking to leverage the huge ecosystem of Bajaj Auto to take down the expense of operations and costs of the product and can also manufacture large scale small bikes in India.
Hero MotoCorp, India’s largest motorcycle manufacturer, is not behind in the competition in the segment and is also working on expanding its portfolio in the mid-size premium motorcycles.
A senior industry expert said that Bajaj Auto and Honda are planning to go after the mid-size motorcycle market as there is a high demand in the Royal Enfield 350cc which is priced about ₹2 lakh. Where these firms are planning to expand in the coming 2-3 years, which will give Royal Enfield a run for its money as both the company are India based and all their parts are manufactured locally.