Royal Enfield in talks with Volkswagen to buy Ducati soon?

Royal Enfield in talks with Volkswagen to buy Ducati soon?

Purchase of Ducati, with its range of V-twins ranging from 400 cc to 1,299 cc, and covering everything from superbikes to dual-purpose touring to retro machines, would fit into Eicher's plans to make Enfield a "global brand".

Ducati is owned by VW's Audi division through its Italian subsidiary Lamborghini.

Ducati is now owned by the Volkswagen group which is believed to be reeling after the diesel emissions scandal.

The talks of a possible buyover come at a time when the Volkswagen Group is battling with a financial crisis as a fallout of the Volkswagen emission scandal which included hundreds and thousands of vehicles with a cheat device to tweak emission figures.

Royal Enfield in talks with Volkswagen to buy Ducati soon?

Unlike KTM-Bajaj or BMW Motorrad-TVS, the Royal Enfield-Ducati partnership will see the former have outright ownership.

According to reports, VW, reeling under a crippling diesel emissions scandal, has tasked investment banking boutique Evercore to evaluate possible options for a sale of Ducati. When asked Eicher Motors, in which Enfield is a part, no comment was made, but Siddhartha Lal, CEO of Eicher stated that the company is open to new ideas.

Eicher Motors is reportedly planning to invest about Rs 1,250 crore across its two-wheeler and commercial vehicle (CV) businesses during 2017-18. Royal Enfield is the second Indian manufacturer after Hero MotoCorp, that is rumoured to be in consideration to acquire the exotic motorcycle brand. We do not expect either company to tap into each other's products segments, but there can be an expected sharing of technologies, engineering and distribution network. Its motorcycle sales grew 31% last fiscal and touched all-time-best sales numbers of 6.66 lakh units against 5 lakh units in 2015-16. The company has a total of 25 stores in worldwide markets too. While the company had set aside $18.2 billion to cover losses due to fines, recalls and fix costs, it needs to refill its coffers with sale of brands being its only recourse.




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