Honda compact car to isolate from the volume segment

The Japanese car maker Honda said the ensuing hatchback car for India, under a JV with Siel Group slated for 2011 will not find place in the volume prone small car segment. Rather it will have its slot above the small car range. The Chief Operating Officer of the company’s Asia and Oceania area said the engine capacity and the price will be soon publicized and it is certain that the car will be positioned above the small car category. However, the Indian market has small cars in the price range of Rs2-4 lakhs like Maruti Alto, WagonR [images], Hyundai Santro [images], GM’s Spark [images] and Beat [images] , Ford Figo [images] (petrol).

There has been a talk about this small car segment as the volume market, but Honda sees its position just above this category. The official made it clear that there won’t be sedan version of the ensuing car. The proposed car was displayed at the Delhi Auto Expo in this January and it was informed that the official launch would take place in 2011 at the price tag of Rs5 lakhs. It is to be noted that in the Honda’s tradition the cheapest car is Jazz [images] offered at Rs7.11 lakhs in India. The newly appointed CEO and President of Honda India revealed that the company’s stature hereinafter would be on 80%localization of components, to be assembled in India for the competition led market.

Currently Honda’s Jazz and City have domestic components in the range of 77% and 76% respectively. Honda’s Civic [images] has 74% while Accord [images] has 28% localization. Honda, he added, is not concerned about the volume of sales and the dip in sales has no way linked to its reputation. Honda received a jolt in its sales- a fall by 2.13% by selling 3578 units in April while its sale in March was a fall by 19.54% with the sale of 5928 units. He said that the company’s position in respect of diesel engines is well known and is primarily targeted for the European market. The company is developing both higher and lower versions of diesel engine. He asserted that the diesel version of Indian car would be based on the market need.

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