Honda Siel small car to hit roads by October

Written by Ronojoy Banerjee | Ronojoy Banerjee | New Delhi | Updated: Jun 1 2010, 02:03am hrs
In a bid to make inroads into the domestic market, Honda Siel Cars India has decided to launch its first small car in the country this year. Besides this, the company will be sourcing more components locally and building a strong engineering and dealership base to increase overall sales. Meanwhile, the company is targeting to double its sales to over 1 lakh units in the next 12 months from the current 60,000 units. The move comes post its January-March sales set back and the company's desperate urge to clock volumes in a market that grew 20% plus in the last fiscal.

During the January-March 2010 quarter, Honda Siel Cars India sales dipped 3% to 21,764 units against 22,376 units in the corresponding period last year. The company was banking on the yet-to-be-named small car to expand its customer base and increase overall sales. Honda Siel Cars India president & CEO Takashi Nagai said, We want to make Honda the best car brand in India that gives hope to 1 million customers in the next five years...optimistically, our operation maybe doubled from next year with the launch of the small car, he said. However, Nagai did not share the incremental volumes he expected from the small car.

According to a senior company official, the small car would hit the Indian roads by October 2011 and would be priced anywhere from Rs 3.5 lakh to Rs 4 lakh. We have realised that Honda Jazz has not performed up to our expectations because of the price factor. However, the small car would be priced competitively, he said.

When asked whether the company had any plans of introducing a strip down model of Jazz, the official said, We cannot scale down Jazz to bring down prices. We can remove the airbags that would bring down the costs substantially, however, we cannot compromise with safety, he said.