Royal Enfield began commercial production from its new manufacturing facility at Vallam Vadagal near Chennai. Spread over 50 acres, this is the third manufacturing facility under the Chennai-based motorcycle company maker.

This new facility near Chennai will manufacture Royal Enfield motorcycles for India and international markets, the company said in a statement. Royal Enfield had acquired the 50-acre plot in Vallam Vadagal back in October 2014 for establishing a manufacturing plant, which became functional in record time.

With the new plant coming in Vallam Vadagal now online, Royal Enfield intends to push the total production capacity from all the three plants to 8.25 lakh units during financial year 2017-18. In the previous 2016-17, Royal Enfield produced and sold 6,67,135 motorcycles, nearing its installed capacity. The company's other two plants are also located in Chennai.

Meanwhile, the company's sales have grown at a compounded rate of more than 55 per cent in the past 6 years. Royal Enfield motorcycles continue to be in demand despite growing competition, with large numbers of orders still awaiting completion.

Royal Enfield has set aside Rs 800 crore investment in 2017-18 for the purpose of capacity expansion at Vallam Vadagal, new products and platforms, and technical centres in the UK, Leicester and Chennai. It will fund the investment through internal accruals.

On the topic of new products, the company is reportedly planning to introduce a new 750cc motorcycle. This new product is supposed to compete with Harley Davidson's Street 750 which features an engine with similar displacement.

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