[shortbread]

The small diesel that Honda is developing will be mostly made in Japan and will come at a ridiculous price hike. End of the day it will be a pointless exercise.

[souravc]

Honda makes brilliant cars but the main question is that are they serious about India as a car market or are they more intent on maintaining the Hindu growth rate for cars while pumping in their money into bikes . This is a pertinent question given that they decided to get out of their immensely profitable JV with Hero to go it alone in India - they must be seeing the pie bigger to take that step. The focus on cars vis-a-vis bikes becomes immensely relevant in the backdrop of the tsunami and the fact that the company's resources are going to be stretched in just rebuilding the home base to the pre-tsunami days. Honda's biggest markets are North America and Japan where gasoline vehicles rule the roost - I don't think Honda feels that India can supplant these 2 markets so why would they prioritise diesel just for diesel especially when they are not so big in Europe which is the biggest diesel market !
I am providing 2 links , the first one is the investor presentation of Honda Motors worldwide created in Nov 2010 - that they see India as primarily a motorcyle market for them is all over the document ! There is a sprinkling of India related automobile plans mentioned .. the link :http://world.honda.com/investors/lib...g_Nov_2010.pdf

The other is the extract from annual report 2010 : Honda Worldwide | Investor Relations | Financial Data | Business Segment Information we can see for ourselves the geographical break-up of sales , pertinent to our discussion is the automobile sales .

If I would compare Honda's approach to Toyota then given that Honda has been in India for a much longer duration than Toyota it shows a lack of seriousness about the market considering the size that they are . Toyota has zoomed ahead with such blockbusters as Qualis, Innova and now Etios . Toyota exports from India auto parts worth nearly or maybe more than USD 2 Billion per annum from India , this is over and above whatever sales and exports of finished cars . Thats a different level of seriousness .

I don't believe that in these times of stretch Honda would put their minds together and devote resources to start working on a diesel engine just to protect their small market share in India ( small in the overall context of passenger cars rather than "City' segment ) . As someone said they should start working on creating a segment of "affordable hybrids" since thats also their focus globally and IMO hybrids would have great acceptability in India once prices come down

[shyaGO]

Originally Posted by souravc

As someone said they should start working on creating a segment of "affordable hybrids" since thats also their focus globally and IMO hybrids would have great acceptability in India once prices come down

+1 to that. Honda is too late to enter diesel car market in India, if they push for affordable hybrids they have better chance of making up numbers in India again. Hey, but isn't "affordable hybrid" an oxymoron

[VeluM]

Found this update on Cartrade India:

The Indian unit of Japan based leading car maker Honda has indicated that it may soon introduce a diesel-run mid-size sedan in the Indian market. In a recent statement, Saki Inaba, the newly appointed managing director of Honda Siel Cars India (HSCI) said that Honda is developing a diesel engine in the range of sub 1.5L. The engine may be introduced with a new model or will be offered with an existing car model of the company.

While further elaborating the company’s plans with this prospective diesel engine, Mr. Inaba said, "Introduction of diesel model is not the only option to grow in India. We are planning to expand our network into smaller cities as well."

It is expected that the company will launch an all new diesel run car in the mid-size sedan segment along with offering new diesel variants of its existing cars of the segment including Honda City and Honda Jazz. Both of the cars are available in the country in the petrol versions only.

Moreover, the luxury sports utility vehicle – Honda CR-V – is also expected to be launched in a new diesel version with a 2.2L diesel engine. The car is already available in the European markets.

Link to article:

Honda likely to roll-out its new diesel-run car in mid-size segment soon

[sreejinair]

Consider this vehicle to go in the cruze segment when its launched or the price of petrol City to go down. Either one is definitely happening. Dont know which one though, in either case Honda without a doubt build excellent good Cars. But they dont have a history of diesel cars. So got now idea how this is going to turn out.

[the VTEC guy]

I simply don't understand why Honda doesn't partner with other manufacturer who have good diesels in there lineup and make direct use of them rather than developing from scratch. Take a look at Suzuki who get there diesels from Fiat.
This would mean faster turnaround. I am feeling Honda is not doing right "business" and have atleast lost 5 years in terms of deisel strategy.

[akj53]

I remember having read few years ago a quote from some international authority of auto industry, Quote: "Honda is a great engine maker, period. Somehow they have got it in their head that they are a great auto maker also" unquote.

The other Japanese maker of so called boring cars Toyota has surged to No. 1 position while Honda may not be in even top 10. Obviously they have not been doing many things right. They are arrogant, failed to read the market, failed to listen to customers who returned from their showrooms without buying among some other things also.

If they did not have a small diesel engine, they could have sourced it from FIAT and plonked it in City and Jazz to revive sales immediately. They could have continued development of their own engine but they will not do it because of their ego.

[amrisharm]

Originally Posted by the VTEC guy

I simply don't understand why Honda doesn't partner with other manufacturer who have good diesels in there lineup and make direct use of them rather than developing from scratch. Take a look at Suzuki who get there diesels from Fiat.
This would mean faster turnaround. I am feeling Honda is not doing right "business" and have atleast lost 5 years in terms of deisel strategy.

In the short term i think it will be economical for honda to use a diesel engine from an outside source. The Fiat 1.3L diesel used in the Sx4 and Linea seem ideal for the city.

There is talk about a timeline for the diesel launch being anywhere from 1 year to 2 years. Who knows what the situation will be like by then. There is talk of higher road tax on diesel engines. Also it seems de-regulation of diesel prices is just a question of when.

No matter how i look at it, i just see a lose-lose situation for honda and diesel engines. Honda is missing out on a golden opportunity to take the lead in Hybrid technology here in india. I do hope they realise this soon and act accordingly.

[iFuel]

I for one feel it is a bit too late for Honda to start thinking on these terms. There was a time when they were the kings in the market and could have blocked the competition out by bringing in diesel engines in the City, Civic and CRV. These cars always required a diesel option, especially when they were looking at a cost conscious Indian buyer.
And now that the prices of petrol are going to the north pole day by day and the competition is laughing it's way to the bank with diesel cars at the expense of Honda, that they are thinking of bringing in diesel. This egoistic feel and the 'no one can touch us, we are Honda' is what killed the great car maker, and they have no one to blame but themselves.
History is writ with failures of great giants over the past who decided not to change for the better and with the market. Blockbuster, Dell, Ford, just to name a few can give solace to Honda as they are living examples of what happens when you sit on a perch and think you are untouchable. Honda is headed the same way (and this is just my opinion, no offense to anyone), however moving from where they started, somewhere down the line they moved into the field of arrogance, with a misplaced view and thought.
Now no matter how much they scamper and try to cover lost ground, what they don't see is that they are too far back in the race and the competition is pulling one card after the other in this race. By the time they have a diesel engine, we might just all be out of crude oil reserves, and then Honda will be back to the drawing board.

[Axe77]

If they were to launch a diesel city, my sense is they'll only be able to launch it in the lower variants with pricing in the region of the higher end city petrol variants.

Such a model IMO will have to fight hard against fully loaded Vernas and Fiestas that may well be more powerful as well.

It may still have a chance though since:

(a) Honda is perceived as a more aspirational brand than Hyundai / ford;
(b) if the Honda is frugal, thats probably preferable to many customers over power (we've seen Toyota prove this in the altis segment); and
(c) customers have been known to pick honda over it's competitors despots lower kit levels (the City has demonstrated this already vis a vis it's competitors.

A higher end variant in theory going by current Honda pricing will be too close to the Altis diesel price point. Given the frugal nature of the Altis diesel combined with the comparable brand value, thats an even tougher fight for Honda to win.

I still firmly believe that as much as I appreciate the Honda quality, they have to re-think their pricing / together with kit levels at least a little bit across their portfolio range. A little bit of customer friendly adjustment on both these counts in my view will do a lot for brand Hoinda in demonstrating it's dominance in various segments.

[caprico4]

i suppose even if honda do manage to plonk the diesel mill in the city in a hurry, it will not be a game changer at all, the only people who will buy it will be Honda loyalists (like my family).

the current Honda CIty petrol costs upwards of 11 lac, so the diesel will well cross the 13 lac mark and enter well into the higher D segment with some high value for money, better snob value and excellently equipped cars like the Altis, Lura, Jetta, Verna, Cruz etc.

people will think long and hard before buying a C segment car at a D segment price.

[Honda Monk]

"http://automobiles.honda.com/civic-gx/"

When Honda can sell plant fitted CNG civic in USA, WHY CAN'T IT DO THE SAME IN INDIA?
IF PLANT FITTED CNG IS OFFERED ON H CITY, THAT WILL KILL ALL COMPETITION HANDS DOWN.
I BET!

[aravind.anand]

Originally Posted by Honda Monk

"http://automobiles.honda.com/civic-gx/"

When Honda can sell plant fitted CNG civic in USA, WHY CAN'T IT DO THE SAME IN INDIA?
IF PLANT FITTED CNG IS OFFERED ON H CITY, THAT WILL KILL ALL COMPETITION HANDS DOWN.
I BET!

That is quite stretch actually. Especially since CNG isn't even easily available in the southern part of the country

[Honda Monk]

I agree CNG isn't available in all parts of country but almost all big cities now have CNG stations which are growing in no.
In metro H CITY with CNG will surely beat all....Arrogance with economy!

IMHO there should be designed such a filling inlet for CNG, that every time one doesn't need to open the hood. its must be annoying

[kirantp]

Fellow BHPians:

I have recently come across several people talking about Honda releasing Diesel version of ANHC sometime by the end of 2011. I also enquired our Showroom Manager about the same to which he said they have not heard of such a news so far. I could sense something funny by his body language while he was answering my query though.

Anybody heard similar news from your respective zones??? Please do share your thoughts and opinions.

Regards, KTP