Eicher Motors Ltd has approved an investment of ₹1,225 crore for Phase I of its proposed greenfield manufacturing facility at Tada in Andhra Pradesh, as it prepares to expand Royal Enfield’s production capacity to meet future demand.
The Phase I investment, to be funded through internal accruals, will create an additional annual production capacity of 4.5 lakh motorcycles. The expansion is expected to be completed during FY30, subject to market conditions.
Capacity expansion
The Tada project forms part of Royal Enfield’s long-term manufacturing expansion strategy. The company had earlier announced plans to invest around ₹2,500 crore in the greenfield facility, which will be implemented in phases.
“To support our growth over the long term, we announced plans for a new greenfield manufacturing facility in Tada, to expand our capacity beyond the existing facilities in Tamil Nadu,” said Eicher Motors Managing Director B. Govindarajan.
The new facility will strengthen the company’s manufacturing capabilities to cater to future market demand.
Manufacturing footprint
Royal Enfield currently has an installed production capacity of around 15 lakh motorcycles annually across its Oragadam and Vallam Vadagal plants in Tamil Nadu, with capacity utilisation nearing full levels.
The company is also undertaking a brownfield expansion at its Cheyyar plant in Tamil Nadu, which is expected to be completed by FY28.
Following completion of the Cheyyar expansion, the combined annual production capacity across the three Tamil Nadu plants will increase to 20 lakh motorcycles.