Honda Cars India’s president and CEO speaks to Sumantra B Barooah on thinking diesel for the City, moving up the value chain and showcasing new concepts at next month’s Auto Expo.

Honda Cars India’s president and CEO speaks to Sumantra B Barooah on thinking diesel for the City, moving up the value chain and showcasing new concepts at next month’s Auto Expo.

The fourth-generation City, at first glance, looks larger and slightly more premium than the one it replaces. And at the same time, you’ve also withdrawn the Civic. Is this a conscious effort to bring a product that straddles both segments and caters to both prospective City and Civic buyers?

The reason we discontinued the Civic is because the market is shrinking drastically and we don’t see any positive side (for that segment) in the future. Therefore, what we aimed for the City is to be the number one car in this upper C-segment. Of course, it is possible that it can catch some Civic customers but our focus is the City customer.

You also wanted the City to be the first car for a set of customers. Is that true?

It can be, depending on the customer. When I was in China, you would be surprised to know that a quarter of our Accord buyers there were first-time customers.

When you talk about expansion, most of the growth is coming from Tier 2 cities thanks to the good monsoon and agricultural economy. How does Honda plan to tap that huge untapped market which is currently being serviced by Maruti, Hyundai and Tata?

I think Hyundai has more than double or triple the number of dealerships that we have. So it means we have a lot of potential in the Tier 2 and Tier 3 cities where we have more demand for smaller cars like the Brio and Amaze. They prefer diesel variants, which is why we created new models to meet their demand.

And this diesel engine, which has a good mix of fuel efficiency and performance, could go into more models, even newer models that are in the pipeline, right?

I think we can make use of this advanced technology – the Earth Dreams technology – and it should be transferred to other models as well.

The Brio, as a product, is solid and strong but it hasn’t managed big sales numbers. Are you looking at doing something more to make it more successful?

We don’t plan to launch a diesel variant of the Brio. We will go with petrol model as far as this generation is concerned.

Are you planning any new additions to the Brio range?

No, because the sales performance is satisfactory for us. I don’t think we need to.

How many more markets will the new City be introduced in?

The previous-generation City sold in 55 countries, and this one is going to be launched in 60 countries globally.

You have good experience of the China market. Like you told us, 25 percent of the Accord consumers in China were first-time buyers. Do you think India is poised to grow in a similar manner?

The pace may be different but it is a general trend that people prefer bigger cars. If the Indian economy grows, then segments like the D-segment and C+ segment will grow faster.

Are you hopeful of the revival of the Accord segment?

The market has not yet grown enough but we are open to being in the segment with the next-generation Accord.

The Auto Expo is coming up. Can we expect some new concept from Honda?

There are many. I’m sure you’ll be surprised. The concept versions come from Japan, or America but the production version will be from India.

In terms of Honda Car India's production footprint, you have Greater Noida now and the Tapukara plant is coming up. OEMs are looking at broader footprints in various locations of India. Is that something Honda is looking at?

As you know, we produced 100,000 units. The Greater Noida plant has a 120,000 units capacity, which is being used fully, and the second plant has the same capacity, which means 240,000 in total. Therefore as regards future plants, we can’t say anything now as it is too early.