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Yoshiyuki Matsumoto, managing officer, Honda Motor Company, said, “India is a key market for us and through the next three years, HCI will launch five important models, including the Amaze. To expand our business in the country…(we) are investing a total of Rs 2,500 crore towards setting up a new assembly line for cars, a new diesel engine component production line and a forging plant at Tapukara in Rajasthan.”
The new models would include sedans and sports utility vehicles, likely to be based on the Brio platform.
While the vehicle assembly line would have an installed capacity of 1,20,000 units a year and would be commissioned in 2014, the diesel engine manufacturing unit would have a capacity of 1,60,000 units a year. Once commissioned, the facility would generate employment for 2,200 people.
“Earlier, diesel engine components were made in Japan and assembled in the UK. The diesel unit at Tapukara is the largest for Honda globally and would be used to supply parts to other Honda facilities in Europe,” said Raman Kumar Sharma, senior vice-president & director (general affairs), HCI.
The company exports critical components for petrol vehicles to markets in Southeast Asia and Latin America. In 2012-13, it recorded revenues of Rs 242 crore from component exports. In 2013-14, this is expected to double, owing to the commencement of supplies from the diesel engine component-making unit.
Though Maruti Suzuki and Hyundai Motor India had announced plans to infuse Rs 1,700 crore and Rs 1,650 crore, respectively, to commission diesel engine manufacturing units last year, Honda’s investment is the first on fresh vehicle production capacity in about two years. In mid-2011, Maruti Suzuki, Ford India and Toyota Kirloskar Motor announced combined investments of about Rs 9,000 crore to expand capacity by setting up new facilities and enhancing production operations at existing locations.
Currently, Honda operates its Greater Noida facility at about 60 per cent of the installed capacity. In 2012-13, the company’s sales in India rose 35 per cent to 73,483 units. “We currently operate in 10 per cent of the passenger vehicle market, as we did not have a small diesel engine. Now, with the new 1.5-litre DTEC diesel engine, our business would increase to cover 50 per cent of the passenger vehicle market over the next few years,” Sharma said.
The diesel engine would be introduced in Honda’s new entry-level sedan, Amaze. Currently, the company is producing about 100 Amaze units a day to build stocks at dealerships, ahead of its launch on April 11.
To oversee the rapid ramp-up of India operations, Honda Motor Company has changed its global organisational structure. It has appointed Managing Director Yoshiyuki Matsumoto as ‘representative of development, purchasing and production in Asia & Oceania region’. Matsumoto would be based in India. In his new role, he would oversee operations across 25 companies and 11 research and development centres. He would head all Honda group companies in India.
<B>Maruti sales dip 4.3% </B><BR>
The country’s largest carmaker Maruti Suzuki India Limited (MSIL) today reported a 4.3 per cent decline in sales to 107,890 units in the domestic market last month. The company had sold 112,724 vehicles in the same period last year.
For the entire financial year (2012-13), however, the company posted an increase of 4.4 per cent in domestic sales at 1,051,046 units.
“On a year-on-year comparison, yes, we are down this March. But, on a sequential basis, these are the highest sales in the last 12 months. Perhaps the market has bottomed out and we might see a little bit of recovery around the second quarter this fiscal,” said Mayank Pareek, chief operating officer (marketing and sales), MSIL.
While sales in the company’s entry-level small car segment (M800, Alto, A-Star, WagonR) declined by 14.7 per cent to 45,047 units from 52,826 units in March 2012, volumes in the compact category (Estilo, Swift and Ritz) too fell by 7.3 per cent to 25,868 units from 27,913 units in the same month a year ago.
The company has increased off-take of mid-range premium products with sales of sedan DZire going up by 22.05 per cent to 20,078 units from 16,451 units in the corresponding period a year ago. The Ertiga too saw strong demand with volumes in the category going up nearly four-fold to 6,488 units from 1,530 units in the year-ago period.
MSIL's exports last month went down by 8.93 per cent to 12,047 units as compared to 13,228 units in the year-ago period. Exports during the year, however, declined by 5.49 per cent to 1,20,388 units from 1,27,379 units in 2011-12, the company said in a statement.
BIG-TICKET AUTO ANNOUNCEMENTS
A look at the investment commitments made
2011
- Maruti Suzuki announces decision to set up its third production facility in Gujarat. Company to invest Rs 4,000 crore to commission capacity of 250,000 units by 2015-16 in the first phase
- Ford announces investment of Rs 4,000 crore to set up second facility in Gujarat, with capacity to make 240,000 vehicles and 270,000 engines
- Toyota Kirloskar Motor invests Rs 989 crore to increase capacity by 100,000 units to 310,000 units a year in two units in Karnataka
- Maruti Suzuki announces investment of Rs 1,700 crore to set up diesel engine manufacturing unit, with total installed capacity of 300,000 units
- Hyundai Motor India announces investment of Rs 1,650 crore ($300 million) to set up a flexi-engine manufacturing unit at Chennai. It will manufacture both diesel and petrol engines
- Honda Cars India announces investment of Rs 2,500 crore to set up a vehicle assembly line of 120,000 units, a diesel engine component production line and a forging unit at Tapukara, Rajasthan
