Royal Enfield Reportedly Says No To Downsizing After GST 2.0
It’s reported that the brand will try to appeal to the government (possibly to modify the tax bracket)
The current GST structure has made bikes above 350cc significantly costlier, and manufacturers like Bajaj (including KTM and Triumph) are already reacting by announcing that they will be scaling down engines to avoid the higher tax. Royal Enfield, however, has reportedly taken the opposite stance.
No Replacement For Displacement
The company says it will not reduce engine size on any of its 350cc-plus models, even if it affects pricing and demand. Siddhartha Lal, Managing Director of Royal Enfield, said that the move will impact India sales and production scale, but also mentioned that altering products overnight isn’t the answer. Instead, the brand plans to take its case to the government and push for a reconsideration of the tax slab.
This makes a lot of sense as all two-wheelers above 350cc – it doesn’t matter if it’s a 400cc or even a 1200+cc bike – are all clubbed into a single tax bracket of flat 40%. This essentially means a 400cc bike and a superbike are equally treated as ‘luxury goods’, which isn’t fair by any means.
Royal Enfield 250
While the big bikes stay untouched, Royal Enfield is also preparing an all-new 250cc bike to strengthen its reach. The engine will likely be sourced from CFMoto, and be adaptable for mild-hybrid tech. The styling, chassis, and cycle parts will all still remain Royal Enfield. This new bike will sit below the Royal Enfield Hunter 350, and serve as the new entry point into the brand’s line-up. We estimate it could cost somewhere between Rs 1.20 lakh to 1.30 lakh (ex-showroom).
Slow & Steady Wins The Race
Where brands like Bajaj experiment aggressively with several engines and multiple bikes in the same segment, Royal Enfield takes the opposite approach: fewer engines, more models, and longer testing cycles. That’s why bikes like the Royal Enfield Bullet 650 and the Royal Enfield Himalayan 750 take their own sweet time to hit the streets even though they are spotted for over a year before launch.
BikeDekho Says
In a market suddenly reshuffled by GST 2.0, the above mentioned approach could help the company maintain stability while preparing better long-term solutions. Rather than a knee-jerk reaction, Royal Enfield’s response seems thoughtful and measured. We’ll have to see whether the government welcomes the feedback.
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