The Hindu Business Line : Honda to invest Rs 700 cr over next five years

UPBEAT about the outlook for the Indian automobile industry, Japanese auto major Honda on Tuesday said it would be investing up to Rs 700 crore in its Indian subsidiary over the next five years to double production and launch new models and variants.

The company, which has invested close to Rs 150 crore for ramping up capacity to 50,000 units per annum from 30,000 units, plans to double the output to 1 lakh units by 2010.

"We will increase capacity to 1 lakh units by 2010 and will launch new models and variants in the Indian market," Mr Masahiro Takedagawa, President and CEO, Honda Siel Cars India (HSCI), told reporters at the company's manufacturing facility at Greater Noida in Uttar Pradesh, where it announced the inauguration of its expanded facility.

Honda holds about 99 per cent stake in HSCI, while local partner Siel India holds the rest.

Mr Takedagawa said the new investments would be met through internal accruals with the company making profits in India.

The company has so far invested close to Rs 800 crore in India.

He added that the company would launch the `Honda Civic' in the country during the first half of next year, though efforts were on to roll it out "as early as possible".

"Work is currently on for launching the Civic in India and we are hopeful to introduce it in 2006," he said, adding that it would start with an annual production of about 10,000 units.

Asked whether the company was looking to make an entry into the small car segment, which dominates car sales in India, he said, "We are studying the possibility though I cannot comment on the timeframe of its launch."