The company is taking the step in view of the upcoming launch of its entry level sedan Amaze in April, which it expects to be a volume generator for it.
"We will have a gap in the production of the current Honda Jazz from March 2013 onwards. The next generation Jazz is planned to be introduced in India in 2014," a spokesperson of the company's Indian arm Honda Cars India Ltd (HCIL) said.
In view of this, the company has currently stopped taking further bookings of the Jazz, the spokesperson added.
The car is currently available in India priced between Rs 5.99 lakh and Rs 6.56 lakh (ex-showroom Delhi).
The Jazz was launched in India in 2009 with a hefty price tag of over Rs 7 lakh. It received tepid response from buyers following which HCIL slashed the price by up to Rs 1.6 lakh in 2011 and it has picked up sales gradually since with a waiting period of up to three months.
Till date since launch, HCIL has sold a total of 22,985 units of the Jazz in India.
Explaining the rationale behind the move to stop Jazz production and sales temporarily, the official said: "The launch of new models in 2013 has resulted in changes to our production mix at our Greater Noida plant. Depending on the market response to the new models, we will keep flexibility to make the changes in line with the demand."
HCIL plans to introduce its first diesel model Amaze in India in April. The entry level sedan qualifies for the excise duty benefit, enjoyed by small cars in India and will directly take on Maruti Suzuki's Swift DZiRE, the current undisputed segment leader.
At present, any car with a petrol engine capacity under 1,200 cc or diesel engine under 1,500 cc, but length shorter than four metres, attract an excise duty of 12 per cent.
HCIL will introduce the Amaze in both petrol and diesel options.