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In-depth SWOT Analysis of Royal Enfield – The Oldest Motorcycle Company In Continuous Production

Updated on: Dec 12, 2021
SWOT Analysis of Royal Enfield - Featured Image

Last time we saw the marketing strategy of Royal Enfield which also included a glimpse of the SWOT analysis of Royal Enfield. But this time we will mainly focus on extracting the SWOT analysis of Royal Enfield.

Royal Enfield is the oldest motorcycle company in continuous production. It made its first motorcycle in 1901. Royal Enfield was originated in Britain. Licensed from Royal Enfield by the native Indian Madras Motors, it is now a subsidiary of Eicher Motors Limited, an Indian automaker. Recently, Royal Enfield has seen immense growth in the past 5 years and is expanding exports in the global markets.

The major element which has contributed to the success of the company is its smart marketing tactics. Marketing is essential for the growth of any business, to know more about marketing and its digital aspect, check out Free Digital Marketing Masterclass by Karan Shah, the founder and CEO of IIDE.

In this blog, we’ll go through Royal Enfield’s strengths, weaknesses, opportunities, and threats in-depth, but before starting with the SWOT analysis of Royal Enfield, first, let’s learn a little about the company.

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About Royal Enfield

SWOT Analysis of Royal Enfield - Royal Enfield 120 Years In The Making
(Royal Enfield 120 Years In The Making, Source: Instagram)

Royal Enfield was a British-owned but now an Indian owned motorcycle manufacturer. The first motorcycle of Royal Enfield was manufactured 120 years ago. Recently, they are celebrating 120 years of pure motorcycling experience by selling the limited edition of their iconic Interceptor and Continental GT. 

Royal Enfield is a publicly-traded corporation that deals in two-wheelers and are linked to the automotive sector. This brand’s vehicles are known for their rough aesthetics, unrivalled stability, and overwhelming power. The brand has long been a favourite of law enforcement and military personnel. 

Now if we talk about its past, the Royal Enfield motorcycle company was started in 1901 and merged with Madras Motors in 1955 to form Enfield India. It is currently a subsidiary of Eicher Motors Limited, its Indian parent business. The Royal Enfield logo, which features a cannon and the words “Made like a gun,” is also notable. This logo represents the Enfield Company’s history. Royal Enfield vehicles are known for their rugged appearance unrivalled durability and huge power.

Quick Stats on Royal Enfield
Founder Robert Walker Smith, Albert Eadie
Year Founded 1901 (U.K.), 1955 (India)
Origin England, Now India
No. of Employees 5,000+
Company Type Public
Market Cap $ 57 Million (2021)
Annual Revenue Rs 8,965.00 Crore (2018)
Net Income/ Profit Rs 1,960 Crore (2018)

 

Products of Royal Enfield

Products offered by Royal Enfield are:

  • Royal Enfield Bullet Electra motorcycles
  • Royal Enfield classic desert motorcycles
  • Royal Enfield classic battle motorcycles
  • Royal Enfield bullet 350 motorcycles

And many more.


Competitors of Royal Enfield

  • Jawa 
  • Triumph Motorcycles 
  • Honda
  • Royal Enfield
  • Motocorp
  • Bajaj Auto
  • TVS etc.


SWOT Analysis of Royal Enfield

SWOT Analysis of Royal Enfield is a process of evaluating a company’s strengths, weaknesses, opportunities, and threats. It allows you to maximize strengths, overcome weaknesses, reduce risks, and increase your chances of success. SWOT analysis helps corporate decision-makers to develop strategic plans according to the internal and external factors of the company.

To better understand the SWOT analysis of Royal Enfield, refer to the infographic below:

SWOT Analysis of Royal Enfield - SWOT Infographics of Royal Enfield

So let us first start by looking at the strengths of Royal Enfield from the SWOT analysis of Royal Enfield.

Strengths of Royal Enfield

  • Strong Brand Name: Royal Enfield has created a strong brand image and identity and has gained a lot of credibility with its customers. Royal Enfield has made itself so popular and a cult brand that it is desired by many.
  • High-Quality Standards: One of the main reasons Royal Enfield has a strong brand name is because of its high-quality standards. Royal Enfield aims at providing the best quality motorcycles to its customers.
  • Strong R&D: Royal Enfield has an in-house R&D centre which takes care of the further enhancement of the product portfolio of the company and makes sure that the reliability of the customers is maintained. Royal Enfield has been successful in investing Rs 600 crores in two more R&D units, one in India and one in the UK.
  • Strong Growth: Royal Enfield has grown by about 50 % over the last 5 years. Such strong growth has in turn increased profits and revenue which can be further invested in improving and enhancing the product portfolio.
  • Embracing Global Markets: Royal Enfield bikes are exported to more than 30 countries worldwide and due to the increase in demand, Royal Enfield has invested heavily in setting up manufacturing facilities in the UK.
  • Support From Eicher Group: In 1994, Enfield India and Eicher Group merged to form Royal Enfield. Eicher, being one of the leading automotive manufacturers, has supported Royal Enfield since and has been an important reason for the success of Royal Enfield worldwide.

SWOT Analysis of Royal Enfield - Royal Enfield Bikers Tour to Ladakh
(Royal Enfield Bikers Tour to Ladakh, Source: Instagram)

  • Amazing Social Media Content: Royal Enfield is equipped with posting amazing social media content which includes the content related to the bikers journey, their stories, their tours and their experience with Royal Enfield. This does increase the craze among young people to purchase a Royal Enfield.

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Weaknesses of Royal Enfield

  • Costly: Royal Enfield targets a niche market of motorcycle lovers who are ready to pay a premium for its brand. But, it misses on a large market that is willing to buy a low priced variant of Royal Enfield.
  • Low Mileage: Royal Enfield produces large volume cylinder bikes (high cc ) which have more capability to burn more amounts of air and fuel and thus they give low mileage as compared to high cc bikes.
  • Heavy Weight: Due to Royal Enfield bikes heavyweight, the weight of the motorcycle may be an issue for a few clients.
  • Delay in Delivery & After-Sale Service: Recently, Royal Enfield is lagging in terms of delivering its 120-year edition. This is creating hatred among customers towards Royal Enfield. 


Opportunities for Royal Enfield

  • Growing Market: The two-wheeler market is growing worldwide which provides an opportunity for the company to increase its customer base and also expand sales globally.
  • Global Expansion: The company needs to expand its export markets and more countries in Europe, Africa and Asia. The demand for such bikes is increasing day by day in these markets and Royal Enfield can take advantage of such an opportunity.
  • Higher Disposable Incomes: The disposable income of middle-class groups in countries like India has been on the rise. Thus those individuals who couldn’t afford Royal Enfield some years ago are now in a position to buy one. This is one of the main reasons for the growing sales of Royal Enfield.


Threats to Royal Enfield

  • Strong Competition: Royal Enfield competes with many bike companies in the cruiser segments worldwide. It also competes with high utility bikes in the market. Such competition in the market reduces the market share of Royal Enfield. 
  • The Rise in Fuel Prices: As mentioned earlier, Royal Enfield has low mileage bikes and thus any increase in fuel prices will affect the sales of Royal Enfield bikes.
  • Hatred on Social Media: Hatred for Royal Enfield in the comment section of social media such as Instagram is increasing day by day because of the poor after-sale service and delay delivery by Royal Enfield. If Royal Enfield will not improve this as soon as possible then it can lose its brand image in the market.

This is the reason why learning the management of online reputation is important. Consistent communication with customers and providing timely solutions is the key to building & promoting a positive brand image.

This ends our end-to-end study of the SWOT analysis of Royal Enfield. let’s conclude our learning below.

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To Conclude

As we saw above, Royal Enfield has become an Indian multinational motorcycle manufacturing company because of its strengths such as strong brand name, strong growth, strong R&D etc. But at the same time, it also has weaknesses such as being expensive, low mileage and delay in delivery.

Although we should not ignore it has many opportunities such as taking advantage of global platforms, growing its market share and targeting people with higher disposable income etc. On the other hand, it still has threats such as strong competition, a rise in fuel prices and hatred on social media.

Even though Royal Enfield’s revenue has increased in recent years, it still has a long way to go. With India’s growing two and three-wheeler market, Royal Enfield should try to grab this opportunity and give its competitors a run for their money. 

The company is using digital marketing effectively to get a competitive advantage. So if you are interested in learning and upskilling your skills in digital marketing, check out IIDE’s 3 Month Advanced Online Digital Marketing Course to know more.

We hope this blog on the SWOT analysis of Royal Enfield has given you a good insight into the company’s strengths, weaknesses, opportunities and threats.

If you liked the case study and would like to read more such case studies just like the SWOT analysis of Royal Enfield, do check out the IIDE Knowledge portal.

Thank you for taking the time to read the blog, do share your thoughts about the SWOT analysis of Royal Enfield in the comments section below.

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Aditya Shastri

Lead Trainer & Head of Learning & Development at IIDE

Leads the Learning & Development segment at IIDE. He is a Content Marketing Expert and has trained 6000+ students and working professionals on various topics of Digital Marketing. He has been a guest speaker at prominent colleges in India including IIMs......[Read full bio]

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