Royal Enfield posted 13 per cent Year-on-Year negative growth in December and the recent launch of Jawa might be the reason for loss downward growth
Royal Enfield sold 58,278 units in December 2018 which include domestic and exports compared to 65,367 units in the same period last year and posted 13 per cent negative growth. In December 2018, the company sold 56,026 units in the domestic market compared to 65,367 units same month last year, which is a decrease of 14 per cent.
But the company exported 2,252 units last month compared to 1601 units in December 2017 and posted 41 per cent positive growth. The exports will continue to improve in coming months as the recently launched 650 Twins are manufactured in India and exported to global markets. Royal Enfield is going to launch the motorcycle is various global markets soon.
The 650 Twins were priced very aggressively in India and the company received a positive response from the customers but the volume in the premium segment is still low as the volume models in Royal Enfield’s lineup is Classic series but the sales have come down drastically in December even though the company introduced ABS.
Until the launch of new Jawa Classic and Forty-Two models, Royal Enfield Classic series didn’t have a direct rival as both these Jawa Motorcycles are so popular among customers. The official bookings began in November and the company had to close the booking on December 25th to manage production and delivery.
Jawa will initially open 105 dealerships across major cities and most of these dealerships are located near the Royal Enfield dealerships as they follow the same retro-design theme. The introduction of ABS has increased the price of Royal Enfield products along with the increased cost of insurance is also another reason for the drop in sales.
The company is going to introduce a new Classic Scrambler soon, which is expected to help the company to improve volume and they are also planning to launch 650 cc variant of Himalayan. The fight between Royal Enfield and Jawa is expected to heat up in coming months as the latter will expand the portfolio with Perak later this year.