Bikers in Bangladesh are one step closer to ride a high-capacity motorcycle after Ifad Autos signed a memorandum of understanding with British-bred Royal Enfield to import the famous two-wheelers.
Founded in 1955, Royal Enfield is one of the world's oldest two-wheeler brands still in operation. Since 1994, it has been owned by India's Eicher Group.
Ifad Autos will market the bikes of Royal Enfield, said Taskeen Ahmed, managing director of Ifad Autos.
The local company is the distributor of India's TVS-branded three-wheelers and the commercial vehicles of Ashok Leyland.
However, the government has to change rules to allow the import of high-capacity bikes. Currently, bikes with a capacity of up to 165cc can be imported, according to the Import Policy Order 2015-2018 of Bangladesh.
Royal Enfield makes motorbikes in the mid-segment market with a capacity of 250cc to 750cc, according to a news article of the BBC.
Bike manufacturers and assemblers have requested the government to allow them to manufacture up to 500cc motorcycles for the export market. The government has said it would allow them to make bikes of up to 350cc, Ahmed said.
"After the government approval, we will bring in some bikes of higher capacity. Then we will decide what can be done," he said.
Ifad Autos is thinking of manufacturing high-capacity bikes to keep the price within the buying power of consumers. Royal Enfield bike will cost Tk 3.5 lakh to Tk 4 lakh.
Some 500,000 units of motorcycles are sold in Bangladesh every year. Of them, 35,000 are high-end.
"In this context, the market size is not small for the high-end segment," Ahmed said. He hopes the government will issue a circular to allow the import of high-capacity engine bikes.
The demand for high-end motorcycles will increase gradually in Bangladesh as the economy is growing and per capita income is rising, he said.
In August 2018, the government gave the go-ahead to Runner Automobiles to import raw materials and components to make motorcycles with a capacity of 165cc to 500cc.
Royal Enfield is expanding aggressively as it aims to tap into the world's biggest motorbike-buying market in Asia, according to the BBC. Recently, it announced plans to open a new factory in Thailand.
Sales for Royal Enfield grew 88 per cent across the region in 2019.