The Hindu Business Line : Honda Siel may announce new plant location soon

Best package
Top company sources said that the top brass is currently in discussions with the Governments of all the three States and is standing by for the best package.

Pune , Dec. 4

Honda Siel Cars India, the Indian arm of Japan's Honda Motor Corporation, is likely to announce the location of its second plant in the country in a few weeks.

In the race to bag the contract for the new plant are Maharashtra, which is fast developing into a hub for foreign auto majors, Uttaranchal - which is rolling out the red carpet for industry - and Rajasthan. Top company sources told Business Line that the top brass is currently in discussions with the Governments of all the three States and is standing by for the best package.

The plant, which is to be put up at an estimated investment of $200 million over the next five years, will help the company significantly expand capacities aimed at capturing a larger share of the domestic car market.

While market sources are betting that the company would pick Rajasthan, which gives it proximity to the existing facilities, sources said that the company is also looking with great interest towards Maharashtra, which recently bagged projects from GM and Volkswagen. Honda officials were not immediately available for comment.

Honda Siel currently manufactures the City, Civic and Accord models at its Surajpur facility, which is currently undergoing capacity expansion. The plant currently manufactures 200 units of the three models and work is on currently to take production up to the level of 62,000 units by the end of the current fiscal and one lakh units by end of next fiscal. The new plant will also have capacity of one lakh units.

The company, meanwhile, is headed towards a significant milestone with its Accord model, which was launched in July 2006 and is set to touch the 10,000-mark in sales, according to Mr Munaf Meghani, Zonal Head (West).

He was speaking to newspersons at the launch of the new CR-V model in Pune.

With capacities at the Surajpur facility currently limited and being shared between the three existing models, there is a wait list of at least 500 customers for the Accord, according to Mr Meghani.

The company is focusing on stepping up production of the same along with that of the Civic, he added.

Meanwhile, sources said that the company is now preparing for a New Year launch of a revamped Accord, which will be rolled out in by mid-January.

Honda Siel is simultaneously expanding its footprint and increasing its dealer strength, which will go up from 53 to 60 by the end of the current fiscal.

Maharashtra, which currently has 16 dealerships, will see another two being added in the next few months.

While the Pune dealership is currently with the Bafnas of Deccan Honda, the company has issued a letter of intent to another dealer who will be operational within 10 months, Mr Meghani said.

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