Royal Enfield To Boost Production Capacity To 20 Lakh Units A Year With Rs 958 Crore Investment

Royal Enfield is preparing for its next big growth chapter in India as the iconic motorcycle brand, owned by Eicher Motors Limited, has announced plans to significantly expand its manufacturing capacity in the country. With demand rising steadily in both domestic and export markets, the company is investing Rs 958 crore to increase its annual production capability to as much as 20 lakh motorcycles.

The expansion will take place at Royal Enfield’s Cheyyar plant in Tamil Nadu and this will be a brownfield expansion, which means the company will upgrade and enlarge its existing facility rather than build a completely new factory. The investment has been approved by Eicher Motors’ board and will be funded through internal accruals, indicating strong financial health.

Why This Expansion Matters

At present, Royal Enfield’s total installed production capacity across its plants are around 14.6 lakh motorcycles per year. According to the company’s regulatory filing, utilisation levels are already close to full, which means the factories are running at near maximum capacity.

With rising demand for its motorcycles from

the 350cc range to its larger, more premium models, Royal Enfield needs more room to grow. After the expansion, annual capacity is expected to increase to up to 20 lakh units. The ramp-up is scheduled to begin in the first quarter of FY2026-27 and is targeted for completion during FY2027-28.

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Sales Momentum

Royal Enfield has been witnessing growth as in Q3 FY2025-26, the company reported sales of 3,25,773 motorcycles which marks a 21% year-on-year growth compared to the same quarter last year.

January 2026 was equally encouraging as the total sales stood at 1,04,322 units, a 14% increase over January 2025. Domestic sales reached 93,781 units, up 16% year-on-year, while exports grew 5% to 10,541 units.

Interestingly, motorcycles up to 350cc, which include models like the Classic and Hunter, contributed 92,998 units in January, reflecting an 18% growth. Bikes above 350cc recorded 11,324 units during the same month.

Royal Enfield also crossed the milestone of one million cumulative sales in just 10 months which is its fastest pace so far. This expansion signals confidence as the Royal Enfield is not just surviving in India’s competitive two-wheeler market, but it is thriving. By expanding production, the company aims to reduce waiting periods, support new launches and strengthen its global presence.