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Dear T-Bhpians,

I came across this article in Businessweek that Honda India is planning to Boost car dealership by 28 percent and will boost advertising to reverse flagging sales and introduce its lowest price car next year.

Honda’s local unit will increase outlets to 150 in 90 cities by March 2012 from 117 in 71 cities now, adding about one a month, Jnaneswar Sen, vice president, marketing, said yesterday in an interview in Greater Noida, near New Delhi. Honda Siel Cars India Ltd. plans to offer a car for less than 500,000 rupees ($10,675) in the second half of 2011, according to Sen.

Sales of the Tokyo-based automaker’s cars have declined 4 percent in the four months to July in India, compared with an increase of 35 percent industrywide in Asia’s third-biggest vehicle market. Cars of less than 4 meters in length, most of which are sold at less than 500,000 rupees, accounted for 79 percent of the sales, according to the Society of Indian Automobile Manufacturers.

By opening more dealers the carmaker is “getting closer to the customer” and is increasing advertising catch up with rivals.

Honda’s small car will compete with Maruti Suzuki India Ltd.’s Swift, Volkswagen AG’s Polo, Hyundai Motor Co.’s i20 and Nissan Motor Co.’s Micra, Sen said.

“This is the fastest growing segment,” said Sen. “If you consider the population of the country and the car penetration, the auto industry is barely scratching the surface. There is space for everybody.”

Source: Honda's India Unit to Boost Dealers 28% to Spur Flagging Sales - BusinessWeek

Any idea which small car they are referring to? I was thinking its the Jazz X

No its not JazzX; may be again a smaller version of Jazz that's being worked upon

This was discussed sometime back already - http://www.team-bhp.com/forum/indian...small-car.html

Thanks Aargee,

But interesting news is that the competition in small car segment is heating up with Honda seriously considering to compete with Swift, Micra and i20.

Its not the Jazz. They showcased the concept of this small car at the auto expo. It was called the Honda small. They are launching this car in 2011, targeting the 5L hatchback market.

You can check out a pic here

Isn't the Jazz already competing with the likes of i20, Polo, Punto?

Or is Jazz positioned much higher due to the inflated price tag?

Honda beleives they are competing. But the price tag of Jazz is around 7.5 lakhs which is way above the swift, i20 and Punto.

Segment wise I beleive they are in the same platform.

At least that's what Honda thought till the Indian customers gave them a kick in the *** and they had to run back to the drawing boards to put out a hurriedly developed concept in time for the Indian Auto Expo. Also they did not want Toyota to steal the show with the Etios.

Hope what they mean as a 5L car is a car of comparable size. They should not bring out a car the size of A-star and then try to compete with the Swift. They should have learnt the lesson by now

Edit : @Aarman : I think we posted at the same time

Very true.

But other than the small car they are planning to launch, one other factor is that they are planning to increase the dealership count as well.

Sen has accepted that their sales have gone down by 4 percent in India, and seriously looking at the 5L segment.

More dealers. Launch of small car. Looks good. But are they planning to offer any discount this time around like Maruti, Fiat and Hyundai? Or is it the same Honda story.

There can be two reasons - first, the small car which may be coming, and secondly the Rajasthan plant coming on stream increasing production to about double.

vento effect?

I mean, jazz was never a hot-seller. But One can see a lot of activity from honda since the day that 6.99 bomb was dropped.

Ohh is it???
It looks like honda has finally hired some analysts. (or decided to pay them finally)

If honda prices their car appropriately, there's not a single reason why it should fail.

Its never too late. Ford had launched Figo realizing the fast growing market for small cars and it went on to become a success.

This is the small car they are going to launch isnt it?Based on the one shown at the expo?