Jawa Motorcycles loss is Royal Enfield’s gain! Know how company set to strengthen its hold in this bike segment

Why is the focus on Eicher Motors growing now? How will its motorcycle brand Royal Enfield benefit? Most importantly, know how Jawa Motorcycles’ loss is going to turn into Royal Enfield’s gain. In show with Zee Business Managing Editor Anil Singhvi, Research Analyst Ashish Chaturvedi has this interesting report. 

Jawa Motorcycles, which is a mid-sized segment company has been seeing almost 50 per cent production cuts on a monthly basis. They were initially making around 7,500 units but are noy making just around 3,500 motorcycles.

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Moreover, the company has also cancelled pre-bookings or orders by 20-25 per cent. The reason behind this is the absence of some key automobile components in the market. This will have an impact on its production.  

The problem for the company is that the demands for motorcycles in this segment have been significant high over the last few months. 

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Amid this, it is likely to take a hit in terms of demand and its production, he added. Mahindra & Mahindra has signed a pact with the company for brand licensing. M&M will be producing Jawa Motorcycles and it will also be involved in the sales process. Though they have small exposure in terms of their size.  

The biggest competitor in this segment for Jawa Motorcycles is Eicher Motors which has a 95 per cent market share. It can be said that the loss to Jawa will positively impact Royal Enfield.  

Moreover, the numbers being posted by Eicher Motors on a monthly basis is encouraging. In September the company sold over 60,000 units which went up to over 66,000 in October. Meanwhile the November and December sales numbers were 63,782 and 68,995.     

The dealers have said that there is a two-month waiting period on this motorcycle.