Honda aims to revitalise entry-sedan segment with third-generation Amaze

Honda Cars India, which has introduced the latest third-generation version of the Honda Amaze compact sedan in the country, is confident about the model’s potential in revitalising the entry-sedan segment which registered a marginal 4% degrowth in volumes in the April-November 2024 period, compared to the notable 22% decline in hatchback sales in the same period.

The company emphasises that entry-level sedans remain a compelling alternative for buyers upgrading from a small car and young families prefer cars like the Amaze. According to Takuya Tsumura, President and CEO, HCIL, “The Honda Amaze enjoys the preferred ‘personal car’ status among its buyers in this segment and almost 50% Amaze customers are first time car buyers. This gives us an immense opportunity to cater to them with multiple offerings and keep them within the Honda fold.”

“The demand for the Honda Amaze is strong across Tier 1, 2, and 3 markets in India, and we will continue to cater to these hubs with our 300-strong network of sales and aftersales touchpoints. We recognise the dynamic nature of the Indian automotive industry and the challenges with respect to tightening emission norms,” Tsumura added.

The sub-four-metre, entry-level model lineup in Honda’s portfolio that is represented by the sole model - Honda Amaze - contributes to about 40% of HCIL’s total volumes, and the company has clocked over half-a-million units of the model since its introduction in India in 2013. As per Kunal Behl, VP, Marketing and Sales, HCIL, “This gives us great confidence that the lower sedan segment is a very strong segment to be in. Entry-level sedans account for 8% of the overall automobile market, with monthly sales of 23,000 units.”

Behl highlighted that while the hatchback segment has declined over the past five years, the sedan segment has achieved a compounded annual growth rate of 2%.

"Even this year, from April to November, the hatchback segment witnessed a 22% decline, while the entry sedan segment saw a much smaller decline of just 4%. There is a gradual shift among hatchback buyers towards sedans or entry-level SUVs," he explained.

Differentiating with robust fundamentals
Honda aims to position the new Amaze at a higher pedestal compared to its chief competitor Maruti Suzuki Dzire, which dominates the segment with over 60% market share. As a result, HCIL aims to outclass its rivals by focusing on robust fundamentals, including a wider cabin, best-in-class 416-litre boot space, and the unique option of a CVT, mated to Honda's 1.2-litre, four-cylinder iVTEC petrol engine. On the other hand, the Maruti Suzuki Dzire gets an AMT. 

Honda has also introduced its vision-based Honda Sensing suite of Level-2 ADAS functionalities such as lane-keep assist and blind-spot detection, thus making the Amaze the cheapest offering in India to sport the advanced active safety technology. The company also claims to have made significant improvement to the 1.2-litre iVTEC engine’s low-end driveability within city limits. 

“We have positioned the Amaze as an ‘Elite Booster Sedan’, designed to outclass its competitors. We have focused on five key aspects - style, safety, comfort, convenience, connectivity, and performance,” Behl said.

“The new Honda Amaze features a 7-step CVT with paddle shifters, in contrast to the 5-speed AMT offered by its rivals. Additionally, it will be India’s most affordable car equipped with ADAS (Advanced Driver Assistance Systems),” he added.

Behl further elaborated that to ensure a hassle-free ownership experience, Honda is offering a 3-year, unlimited-kilometer warranty, with an option to extend it to 7 or 10 years.

“These features will help the Amaze stand out in its segment. Both Amaze and new rival offerings will revitalize this category. There is already significant excitement, and we plan to build on that further,” Behl added.

The company is targeting young buyers - “fast trackers who like being in the spotlight and are particular about the choices they make. To cater to this ambitious Indian, we have positioned the new Amaze to outclass its rivals,” Behl pointed out. 

Focus on private buyers
While the share of CNG powertrains in the sub-four-metre, entry-level sedan segment has grown significantly from being pegged at 15% to over 60% in the last five years, and being primarily driven by fleet sales, Honda says, it remains focused on private buyers. 

"We will focus on naturally-aspirated petrol engines in this segment, however, our dealers will also offer CNG as a fitment option, which has been tested and approved with select vendors," Behl stated.

To cater to a broader range of buyers, the company will likely retain a few entry-level trims of the outgoing second-generation Amaze for about a year, thus ensuring competitive price points for entry-level sedan customers.

According to Ryuto Shimizu, Director of Marketing and Sales at Honda Cars India, “It is not just about tangible things like the spec sheet or the feature list; when you drive it, the new Amaze has the Honda vibe.”

“We are also considering that and reflecting it in the price. It is like a combined Christmas and New Year present to the customers because we believe the first cluster of customers coming to the showrooms will be the loyalists, the Honda fans. So we would like to reward them with that kind of an attractive pricing,” added Shimizu. 

The company has launched the third-generation Honda Amaze with prices ranging from Rs 7.99 lakh to Rs 10.89 lakh, ex-showroom.