The Indian maker of Royal Enfield, the World War II-era British motorcycle, is expanding its foray in the U.S., the bastion of Harley-Davidson Inc., as the almost $7 billion market lures it with the promise of higher margins.

Eicher Motors Ltd., the owner of the 120-year-old brand that counts Billy Joel and Jay Leno among its celebrity collectors, aims to “dominate” the mid-size motorcycle market in the U.S., Siddhartha Lal, the managing director of the New Delhi-based company, said in an interview. Last month, he hired Rod Copes, a former head of Harley’s global customer sales and service, to lead Enfield’s expansion in the U.S. and Canada.

“Motorcycles have reached an extreme, with extreme power, extreme speed, and are extremely heavy and extremely expensive,” Lal said in New Delhi. “We think there’s a market for urban, manageable and efficient motorcycles. The mid-size market in the U.S. is underserved.”

Eicher is seeking newer markets for its bikes to boost profit margins as economic growth near the slowest pace in a decade in India hurts sales at its truck unit. The company may find the U.S. market tough to crack with its outdated, single-cylinder bikes at a time when Harley-Davidson and Triumph Motorcycles Ltd. are introducing smaller and lighter models, according to Deepesh Rathore, director at Emerging Markets Automotive Advisors.

“It will be difficult, but I think there is potential for Royal Enfield as the other competitors are in the more expensive space,” said Rathore. “My only concern is that Harley is coming with smaller models such as the Street.”

This year, Harley began delivering its first lightweight bike in decades called the Street. The company’s first new platform in 13 years, the Street is available in 500 cc and 750 cc variants to target younger buyers in emerging markets such as India as well as at home in the U.S.

In markets such as the U.S., Australia and Europe, motorcycles are lifestyle products that fetch better margins, whereas the vehicles are used mostly for commuting in price-sensitive developing economies, Rathore said. The U.S. motorcycle market is projected to generate $6.9 billion in revenue this year, according to a report by IBISWorld Inc.

Eicher, which acquired control of Enfield India in 1993 and revived the almost-bankrupt unit, has about 100 dealers in the U.S. where it sells 3 motorcycle models priced between $4,999 and $5,999. It aims to ship “tens of thousands of motorcycles” from about 1,000 now, Lal said, without elaborating. It will also introduce new platforms that are better suited to the U.S. and European markets, he said, with the first due next year. (Bloomberg)