Davis Index: Market Intelligence for the Global Metals and Recycled Materials Markets

Indian auto manufacturer Eicher Motors has planned to increase capacity at its Pithampur plant, in the state of Madhya Pradesh, to produce 90,000 units of heavy vehicles. With the addition of the Bhopal plant in December 2020, the company’s total annual capacity will reach 130,000 units. The most laggard auto segment—commercial vehicle, has also begun to improve with a 3pc increase in domestic sales in December compared to the prior year. It became the first month to record growth in 2020.


Royal Enfield, part of Eicher Motors had ramped-up bike production two months ago despite hindrances in the supply chain. Royal Enfield has pushed production up to about 75,000 units in December and January amid demand recovery in the country. The waiting period for some of the models has reduced with the company ramping up production. Sales stood at around 200,000 units in the December quarter while exports rose by 44.4pc to 12,234 units in the same period compared to the prior-year quarter.


A shortage of Engine Control Units (ECUs) has hurt production and deliveries, stated the company management in their Q3 conference call. Around 70,000 bikes were sold in December and January, with increased bookings than the previous year. Maharashtra and Tamil Nadu markets, considered more mature, are reviving. Exports have also risen, and the company is focusing on Latin American and ASEAN markets.


Eicher has exceeded pre-COVID-19 production levels though challenges like erratic supplies, increase in prices of commodity and logistics continue to hurt production, the company said. 


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