Honda bullish on petrol, to go local with new CR-V

The Japanese carmaker will launch the all-new CR-V SUV next month with the pricing expected to be slightly lower than the outgoing model on plans for local assembly at its Greater Noida facility.

The current CR-V model, priced at about R22 lakh (ex-showroom, Delhi), is imported from Japan as completely-built units and attracts customs duties of 60%. To be price competitive in the domestic market, Honda, therefore, has to make do with slim margins. The new CR-V will, instead, be imported as knocked-down kits and assembled locally, attracting around half of the previous customs rate at 30%.

This is likely to aid Honda in marginally reducing prices and improve profitability — its losses, in fact, had almost trebled to over R600 crore in FY12 on dropping volumes.

Jnaneswar Sen, senior vice-president for marketing & sales at Honda Cars India, said, “The new CR-V will be assembled locally and only be available in petrol. We do sell a diesel variant in Europe, though it is not suitable for Indian conditions. We ran out of the last generation CR-V about six months back as imports had stopped — the last few models were sold at a discount.”

The plan to stick to a petrol SUV, and not add a diesel variant, is surprising, said analysts, especially when most of the competition is rapidly launching new diesel vehicles. Diesel vehicles today account for almost 60% of new car sales,

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