At a time when exports of India-made passenger vehicles are witnessing strong growth, Japanese automaker Honda Cars India has shifted its focus toward the domestic market while stepping up plans to bring fully built imported models into the country.

The company’s exports declined sharply in FY26, falling 56% to 26,485 units from 60,229 units in the previous financial year. This comes even as overall passenger vehicle exports from India rose 17.5% to 905,200 units in FY26, compared with 770,394 units in FY25.

Honda’s export decline contrasts with the performance of other Japanese automakers operating in India. Maruti Suzuki reported exports of 443,825 units in FY26, up 35% from 330,081 units in FY25, while Toyota Kirloskar Motor exported 38,974 units during the year, a 41% increase from 27,640 units in FY25.

Honda Cars India President and CEO Takashi Nakajima indicated that the company’s strategy now prioritises the domestic market over exports. “Exports are a second priority. The first priority is the Indian market,” he said.

The company added that while export shipments will continue to select markets, including Japan and other regions, India’s production base will primarily be geared toward domestic demand and capacity utilisation.

The Japanese automaker will instead accelerate imports of completely built units (CBUs) into India, primarily from Japan. Of the 10 models planned for the Indian market, the company said there will be a mix of imported vehicles and locally assembled products.

The first such model, the Honda ZR-V e:HEV, was launched last week as a CBU imported from Japan.

The move marks a shift from Honda’s earlier strategy, under which exports were positioned as a key component of the company’s business and revenue plans.

In September 2025, Honda Cars India crossed cumulative exports of 200,000 units. At the time, Kunal Behl, Vice President, Marketing & Sales, Honda Cars India Ltd had said the milestone reflected the growing global acceptance of India-made Honda vehicles.

“Exports are an integral part of HCIL’s business and revenue strategy, and we remain committed to strengthening this area going forward. We are dedicated to the ‘Make in India’ initiative, serving both our domestic market and global customers,” Behl had said. 

Sources aware of Honda’s strategy said the company’s stronger export performance in earlier years was partly linked to global production scheduling adjustments involving Japan, which have since changed.

Over the years, Honda Cars India has exported vehicles to 33 countries. Japan accounted for 30% of total exports, followed by South Africa and Southern African Development Community (SADC) countries at 26%, Mexico at 19%, and Turkey at 16%. The remaining exports were shipped to markets in the Middle East, the SAARC region, the Caribbean, and South America.

The company’s major export models have included the Honda City and Honda Elevate, which together contributed 78% of export volumes. Other exported models included the Brio, Amaze, Jazz, BR-V, Mobilio, City e:HEV, Accord, and CR-V.

Honda, however, maintained that India remains one of its three priority global markets, alongside North America and Japan, though the company indicated that future growth in India will increasingly be driven by imported models alongside locally assembled vehicles.