The Royal Enfield motorcycle brand will not rush into electric motorcycles in the very near future, explaining the time is not right, yet.
Siddhartha Lal, Managing director of Eicher Motors, said during a conference call announcing the company’s first-quarter results, that Royal-Enfield will not hurry to go electric quite yet. During the call, Lal explained that the company will be there in a few years, but not right now, and explained that the company has a ‘philosophy and game plan’ to paraphrase, and that an actual product will come at a later stage.
“There is no delay from our side. Our plan is not to come to the (EV) market right now,”
Siddhartha Lal, managing director, Eicher Motors Ltd. (parent of Royal Enfield)
Even after Eicher Motors announced that they have plans for a complete range of EVs, it appears that this move will take longer than expected, at least for the Royal Enfield brand.
“It will be there in few years, but certainly not there yet,”
Siddhartha Lal, managing director, Eicher Motors Ltd.
This may come as a disappointing statement for some of the brands followers, since there already exists custom models made on Royal Enfield motorcycles (like the Electric Classic Car customized Photon Bullet). In addition, there are strong tailwinds pushing electric mobility forward in India, with the FAME II subsidies, and despite that Eicher does not wish to try and capitalize on this growing demand and increased government support.
When looking at the overall market, globally there are many companies getting into the electric mobility space, a lot of which are completely new companies that plan to disrupt the space, while other traditional manufacturers have taken more time and only over the past year stepped up their game towards electric 2-wheelers.
In India alone, there is a strong competition, with many different companies taking their share of the demand. Ola electric recently reported 100K pre-orders on their electric scooter, Revolt Motors sold off in a matter of hours, in two different online sale occasions, and many other are already offering at least some models with electric power.
“We only have sights on the long terms of where we want to be, we don’t do anything half-backed or dipping your toe into the market, that’s not our philosophy at all,” he said. “We will come in with sorted products, ecosystem and business models.”
Siddhartha Lal, managing director, Eicher Motors Ltd.
Traditional manufacturers like Bajaj Auto, already has its electric Chetak in the market and will establish an EV sub brand/unit. Recently, TVS Motor launched the iQube electric scooter. Hero MotoCorp Ltd., India’s largest two-wheeler maker, has invested in Ather Energy and signed a JV with Gogoro Inc to build battery-swapping infrastructure, and that is outside of the HeroElectric company it has a stake in.
Globally, there is not a doubt in mind, even for veteran brands like Harley-Davidson, that electric mobility is taking over, and the company launched the Livewire electric brand as a subsidiary. There are many great manufacturers across Europe, with specialized companies like Energica that makes some of the top electric sport bikes, the Swedish CAKE that manufactures high quality off road street legal bikes, and really many many others.
Lal mentioned that it doesn’t matter if competition has lined up products. “Our approach is different. We believe we have a very strong thought process, philosophy and a game plan, and in terms of new product coming into the market the execution will be quite a while later.”
Siddhartha Lal, managing director, Eicher Motors Ltd.
Despite that, it appears that Eicher, and Royal Enfield, will not hurry to getting into electric motorcycles any time soon, which is a very unfortunate statement to hear. Just days ago, we covered the awesome presentation by Saietta Group, the makers of Axial-Flux motor technology, that plans to present their electric converted fleet, that included the Royal Enfield.
The “Catch-22” for manufacturers – Our Opinion.
For many years, a similar situation was increasingly reviewed by analysts in the Automotive industry in relation to Tesla compared to traditional manufacturer. In those comparisons, we can see that revenue streams for Tesla were relying solely on sales, while for other auto-manufacturers, there was a large portion of revenue coming from selling parts and auto-maintenance.
When we look at some of the reasons for delaying the move into electric motorcycles, it is my personal opinion, that the legacy manufacturers have the same serious problem that they are now facing, with revenue streams dependent on parts and maintenance, and the comparable electric motor that requires zero maintenance, effectively killing an entire revenue stream these companies previously relied on.
Making an electric model would mean factoring in the low maintenance, and then perhaps increasing the cost significantly, which would make the motorcycle less affordable and thus less sellable.
It appears to be a ‘catch’ for many of the traditional manufacturers, that struggled to make the bold decision and adopt electric in their R&D departments, or started the involvement just in the recent year. For those companies, that actually leg behind there is a lot of catching up to do in order to bring their aspired models into production lines.
Source: Bloomberg Quint, Times of India, Financial Express