[arup.misra]

Honda Motor will reorganize its car business in India, scaling down its lineup of sedans and focusing on compact vehicles, the Nikkei reported.

Honda, which recently converted its India joint venture, Honda Siel Cars India Ltd, into a wholly owned unit, plans to postpone sales of the new version of its Civic sedan, and forgo manufacturing the new version of the Accord sedan in the country, the business daily said.

The Japanese car manufacturer may discontinue the Accord vehicle altogether in India, the paper said.

Honda's India sales, which fell 20 per cent in 2011, have jumped 70 per cent in January-July, helped by the newly launched Brio subcompact, the Nikkei said.

Source - NDTV Profit


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[sids911]

Originally Posted by arup.misra

The Japanese car manufacturer may discontinue the Accord vehicle altogether in India, the paper said.

Wrong move I would say, the Civic sold relatively well in India, and will continue doing so if Honda gives a value proposition ala Brio and City.

Likewise for Accord. Honda, why not try innovating and beating the Koreans at their own games, instead of scaling back??

[sgiitk]

With the Accord gone and Civic almost gone the only sedan left will be the City. So a Brio / Jazz based line up (both are selling well) is very likely. Also, I may add that the City and Jazz are both on the same floor pan, and the Civic is far more popular as a Hatch is Europe!

[vasoo]

Honda seems to be doing exactly the opposite of what Hyundai is doing. Hyundai started off with small cars and slowly scaled up to premium category while Honda is going in the other direction to a segment which is already crowded with established players and cut-throat competition. They still dont seem to realize that lack of Diesel option is their problem and nothing else. They should rather shut down their manufacturing till diesel options are available for all their models and then see what happens.

[sarathlal]

Honda India is really prompt in publishing the Press releases/news on their site hondacarindia.
Till we get to see these news published there, isn't it better to consider these as rumors?

[Tsixty1]

Strategy is something which allured me. But this moves does not make any sense to me. Honda is smart company they did very well in 2 wheeler segment in India. Honda cars are for urban India, people with disposable income and who valued the badge. Not sure how they are going to compete at the middle which is very price sensitive and too crowded.

[arup.misra]

The Accord or Civic were great at its launch when petrol pricing were atleast 30% cheaper than current levels. Now with the diesel - petrol gap widening and availability of diesel mills at 23L (Superb 2.0AT TDI as an example) the blow was imminent. This was pretty well reflected in sales figures for July with Accord not even managing to get to a ton.

Getting a diesel heart and / or CNG with focus on mass market Brio, premium hatch Jazz and C-segment City would help Honda getting the numbers. Perhaps getting in Acura at a later stage with a diesel / hybrid may help it position itself in the premium / luxury segement.

O.T - Strangely why is the luxury segment dominated by the Germans with both Japs & Korean conspicious by their absence

[tazmaan]

Very Very bad move. This will hit the image of Honda badge, from a company known for premium cars to company who can only sell hatches in India. The dealership experience will change where they wont be able to handle customers the same way as before. Rather than taking competition head on they have decided to quit, no marketing attempt, no attempt to bring in diesel in the Civic and city which are their flagship cars.

I had bought the accord 2 years back and am worried if Honda will be able to give me the same service ever. It has already deteriorated after launch of brio and reduction in price of Jazz.

It will take a lot from Honda to convince me to buy another Honda for a long time.

[shadows123]

Originally Posted by tazmaan

Very Very bad move. This will hit the image of Honda badge, from a company known for premium cars to company who can only sell hatches in India. The dealership experience will change where they wont be able to handle customers the same way as before. Rather than taking competition head on they have decided to quit, no marketing attempt, no attempt to bring in diesel in the Civic and city which are their flagship cars.

I had bought the accord 2 years back and am worried if Honda will be able to give me the same service ever. It has already deteriorated after launch of brio and reduction in price of Jazz.

It will take a lot from Honda to convince me to buy another Honda for a long time.

I dont think the deterioration in service is because of the Brio/Jazz. Its because their sales have been tumbling for years now and so their best mechanics would've long quit by now!!

That said, Honda is going the wrong way by pulling off its accord model. For a petrol only model, the new Camry has had a decent opening if reports are to be believed. and the new Accord would've gone the same way considering India adores Honda more than any other automobile brand!

[vkaul1]

Seems to be a very defensive stand by Honda. More & more smaller segment players (read Maruti & Hyundai) are trying to up their ante to move up the chain & add more "prestige" to their brands.

Honda on the other hand seems to be going in the opposite direction. While they are know for fantastic free revving petrol engines, I am sure they would have heard & understood the lack of diesel mills hurting them - which will happen even more in the smaller car segment.

It would be sad indeed to see the end of fantastic cars like Civic & Accord in India. Hopefully they are just taking time to regroup & come back stronger.

[one-77]

Originally Posted by arup.misra

O.T - Strangely why is the luxury segment dominated by the Germans with both Japs & Korean conspicious by their absence

Way off topic, but just try answering this: If you were in the market now for a 25-30 lac sedan, and were to choose between the Accord, the Camry, the Teana, the Sonata, the Superb, and the Passat, which would it be?
For me it would be the Passat, as it has a German badge, good safety kit, a solid build, good plastics, and decent features. Looks good too, IMO.
(If could squeeze out some 5 lac more I might even go for an A4 or a 3 Series, but that's another thing)
I probably wouldn't even consider the Japs or the Korean in the list because they have no diesel, and will be tough to resell 5 years down the line. To top it, the Accord and Camry are too basic on the inside and provide fewer safety features, and give single-digit mileage figures.

[nilambuj]

I think it makes perfect sense that Honda is delaying things until they have a clear strategy for the Indian market. I would look at it this way- instead of dropping the prices or any other desparate moves, they are holding onto their brand value. I don't believe that there will be any negative impact to the fan following if they come back with a product that will make a difference in the market.

[avira_tk]

Honda shouldn't bother with the new Civic, unless they have a diesel. Honda's history of pricing and equipment levels means that diesel will be a 1.5L mill and will be costlier than a Jetta/Laura. The new Civic doesn't have anything to make it stand out in the current crop, its too plain and petrol doesn't sell.

The Accord still has a chance if they launch the Euro diesel version, otherwise it will be another single digit star in Honda's lineup like the CRV(costs as much as a 3 series with less equipment than an i20). All in all a good move by Honda, removes deadwood and helps then concentrate on numbers.

[siddutta]

isn't a 1.6 l diesel CRV expected by 2013 ? I have read that it would be assembled in India and sold at a price range of 15-17 lacs ex-show room price .

[microaubin]

Originally Posted by arup.misra

O.T - Strangely why is the luxury segment dominated by the Germans with both Japs & Korean conspicious by their absence

About 8 - 10 years ago a Ford escort, Corolla , Civic, Octavia were very much considered luxury, the Camry, Accord super luxury and the Mercs the ultimate luxury. With the economy exploding Corollas, Civics and Octavia's are dime a dozen and even Mercs, BMW's and Audi's are common sights these days.

Its all about perception....Japs are reliable, Germans are luxuriously reliable and the Koreans are no good ( thats what most NRI's from the middle east think). However due to some remarkable performance from Hyundai that perception is slowly changing.

So I guess for the same amount of hard earned money people are more inclined towards luxuriously reliable.