Royal Enfield Targets 2.45 Million-Unit Capacity by FY30

Royal Enfield plans to increase its annual manufacturing capacity to 2.45 million motorcycles by the financial year 2030 through a combination of brownfield expansion at its existing Tamil Nadu facility and a new greenfield plant in Andhra Pradesh, a senior executive said on Tuesday.

Current Capacity Utilisation Hits 90% in FY26

Royal Enfield currently has an annual manufacturing capacity of around 1.5 million motorcycles across four production units in Cheyyar and Chennai in Tamil Nadu. 

The company manufactured 1.24 million motorcycles in FY26, with capacity utilisation at its existing plants rising to 90% in FY26 from 50% in FY20, reflecting strong demand and the need for additional production capacity.

Cheyyar Brownfield Expansion: Rs 958 Crore Push to 2 Million Units

Eicher Motors is investing Rs 958 crore to expand its fourth and newest manufacturing facility at Cheyyar, while its global manufacturing footprint includes seven CKD assembly units with a combined annual assembly capacity of 150,000 units.

Speaking to investors after the company's first-quarter results, B Govindarajan, managing director of Eicher Motors and CEO of Royal Enfield, said the first phase of the Cheyyar expansion has increased annual production capacity to about 1.5 million motorcycles.

"The current capacity, with the first module, which we have been talking about at Cheyyar, the capacity has come to almost about one and a half million motorcycles per year," Govindarajan said.

He said the first module became operational in July and has helped increase production. "We have almost come to about 5000 plus per day as a delivery in our plants," he said.

The remaining phases of the Cheyyar brownfield expansion are expected to be completed by FY28, taking the plant's contribution to Royal Enfield's overall annual capacity to 2 million motorcycles.

Andhra Pradesh Greenfield Plant: Rs 1,225 Crore for 4.5 Lakh Additional Capacity

"Subsequently, the next phase... will take us to the 2 million capacity. So, the entire brownfield capacity... will all come by financial year 2027-2028," Govindarajan said.

Alongside the Tamil Nadu expansion, Royal Enfield is setting up its first greenfield manufacturing facility in Andhra Pradesh. 

Eicher Motors board has approved an investment of Rs 1,225 crore for the first phase of the project, which will add annual production capacity of 4.5 lakh motorcycles once fully utilised. The first phase is expected to be completed during the 2029-30 financial year.

"Going forward, Andhra Pradesh, that's what today the board has cleared- about Rs 1,225 crores. And that will take us to the overall capacity of 2.45 million. That will happen by 2029-30," Govindarajan said.

He said the company was sequencing its investments to align with expected demand. "We are taking it in phases, because the growth momentum is continuing. And we do see going forward, we have to be prepared for the capacity, and that is why the investments are being done," he said.

"Currently, we are almost about one and a half million... We will eventually go to 2 million capacity at the brownfield. With the greenfield... we are on the path to take our total capacity to 2.45 million by 2029-30."