Royal Enfield rides into Indonesian market, sales to begin soon

Royal Enfield has announced its entry into the Indonesian market at the Gaikindo Indonesia International Auto Show (GIIAS 2015) which is underway from August 20-30.

The foray into Indonesia, the third largest two- wheeler market in the world after China and India, is part of the company's growth strategy and focuses on its game-plan to expand into the global midsized motorcycle segment (250-750cc).

Royal Enfield’s display at GIIAS 2015 includes the Bullet 500cc, Classic 500cc and Classic Chrome, and the Continental GT (535cc) cafe racer. Also on show is protective riding gear and the recently launched Despatch Rider apparel and accessories collection.

The company plans to begin retail operations in the coming months from its dealership in Jakarta, which is being set up in partnership with PT Distributor Motor Indonesia in Jakarta.

Speaking on Royal Enfield’s strategy for Indonesia, Arun Gopal, head (International Business), Royal Enfield, said: “Backed by growth of over 50 percent year-on-year in the last five years, our ambition today is to lead and grow the middle weight segment, which is underserved globally. We believe this growth will largely come from markets like India such as Latin America and South East Asia, given their size and comparable commuting trends. Towards this, we entered Colombia last year with a very encouraging response to our products. ”

“Indonesia is a strategic market for Royal Enfield. With its large commuter base, this market has enormous potential to upgrade to the next level of motorcycles, should there be optimal product choice. With our modern classic bikes, Royal Enfield is well poised to fill this gap and catalyse the shift to midsize motorcycles in Indonesia. We will build our presence from Jakarta and depending on the response, expand our footprint to the other key cities in Indonesia,” Gopal added.

In 2014, Royal Enfield over more than 300,000 motorcycles globally. In CY 2015, the company is targeting production of 450,000 motorcycles to support its global growth strategy. 

Latin America and Colombia to play key role

Latin America and Colombia are likely to play key roles in Royal Enfield's global growth plans. In an interview with Autocar Professional on July 8, 2015, Rudratej Singh, president, Royal Enfield had said, "These are what I call white spaces. Economically and demographically they are very similar like India. Let’s say all of Latin America, Colombia or Indonesia, which are very similar in terms of their economic life stage at which they are and the opportunity that exists. There’s again the opportunity to move this large base of commuter segment to something more evocative; this is meaningful to their current core purpose but can do more. This is where we believe we will hit the sweet spot."