Royal Enfield Restarts Production; Loses 11,000 Bikes In Flood

Eicher Motors owned vintage two wheeler brand Royal Enfield is one of the big victims of the Chennai flood that hit the southern coastal city of India. Due to the heavy rains and flooding the manufacturing factory of Royal Enfield which is located in Chennai had to shut down. This has resulted in a total loss of about 11,200 bikes that were not produced in the time period that the production was shut down.

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The Royal Enfield manufacturing factory located at Thiruvottiyur and Oragadam near Chennai had to be shut down since December 1, 2015 due to heavy flooding and rains in Chennai. The company has resumed production again since it opened again on December 7, 2015 but the production is yet at full capacity due to unavailability of the complete workforce. Not just the work force but other business in Chennai which were the spare parts of Royal Enfield had also had to shut down shop which meant there is a shortage of materials for the company to work on.

A company spokesperson gave a statement, “Prima facie, there is no damage to equipment or property and all our employees are safe and secure. The company has had production loss of 7,200 motorcycles due to the closure of both the company’s manufacturing facilities between December 1- 6, 2015.”

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Currently the company is running at about 50% production capacity but that will be back to 100% again once everything settled down and the supply gets back to optimal levels. The company in a regulatory filing mentioned that it will be back to business as usual as early as next week. The good news is that there is no loss to any of the employees and none of the equipment is damaged as well.

The supply is still getting back on track and there will be some time till things back to normal at the facility due to the floods. The rains had a huge impact on everything in Chennai and due to it the company lost production as well as caused issues with the bikes which were on the production line.

The company is not monitoring everything closely to check out the exact amount of damage and loss incurred to them so that they can give out a formal statement to the media about the entire situation and also assesses the insurance loss in all this, but it is all possible only after things get back to its regular running position.