Royal Enfield intends to build a new factory in Tamil Nadu in order to expand its product portfolio and diversify into electric vehicles. Royal Enfield has already purchased a 60-acre plot of land in Cheyyar, on the outskirts of Chennai, according to sources. There are plans to invest between Rs 1,000 crore and Rs 1,500 crore over the next 12-24 months, depending on the manufacturing capacity finalised.

The new factory will be dedicated to the production of new Royal Enfield internal combustion engine (ICE) motorcycles, a portfolio that has been steadily expanding. Following the recent introductions of the Super Meteor 650 and the Interceptor/Continental GT 650 with alloy wheels, the company is preparing to introduce the Shotgun 650 and the highly anticipated Himalayan 450. The first bike will most likely be produced in a dedicated facility within the existing Vallam Vadagal plant, which serves as the company's primary IC engine production base. The company has already begun work at the Cheyyar plot to ensure a smooth transition to EVs once the models are developed and ready for rollout.

Royal Enfield's existing plants in Oragadam and Vallam Vadagal currently have a combined manufacturing capacity of over a million units per year, which is sufficient to meet the growing demand in the coming years. The expected recovery in the domestic two-wheeler market, RE's aggressive global expansion, and the company's diversification into EVs necessitate that the company be future capacity-ready.

Meanwhile, a 60-acre plot of land in Cheyyar has been purchased to relocate some of its operations from the Thiruvottiyur facility, which has been in operation since 1995 and has become a thriving residential area. According to sources, the company may spend between Rs 100 and Rs 150 crore on groundwork, with the factory not opening until 2025.

An email sent to Royal Enfield seeking its response did not elicit any response till the time of this report being published.