The Hindu Business Line : Honda sets sales target of 3,800 units of CR-V model

Mumbai, Aug. 10 Honda Siel Cars India (HSCI) has set a target of 3,800 units for its premium SUV (sports utility vehicle) CR-V to be sold by the end of this fiscal year (2007-08).

According to SIAM’s (Society of Indian Automobile Manufacturers) monthly flash reports, the company has sold 1,066 units (April-July) and intends selling the remaining 1,734 units in the next eight months i.e. an average of 217 units on a monthly basis.

Price Benefits

Senior officials said that the company with its list of pending orders will sell 500 units in the month of August alone. According to a company press release, the company sold 1,873 units of the SUV model during 2006-07.

Attaining the sales figure of 3,000-plus units on a fiscal basis calls for a possibility of assembling the vehicle locally. According to senior officials, the company is currently evaluating the prospect of a semi knock down operation (SKD) for the model.

The sales figures attained are quite similar to that of the Honda Accord that is assembled through the same SKD operation with two different engines options in spite of limited numbers. Going by that analysis, experts believe that the possibility of assembling the CR-V is high.

SKD operations have their own benefits. Import duty on vehicles is considerably lower than CBU imports. Invariably the price benefits due to different manufacturing practices can be passed on to the customer that can possibly lead to higher sales volumes.

Secondly, due to a SKD operation, certain parts can be indigenised thus generating additional business for the local ancillary industry. Last but not the least, the subsidiary would not be entirely dependent on the parent company’s export schedule for its own quota of cars.

CR-V has been the market leader in the SUV segment, ever since it was launched in 2003. Constant evolution in design and features has raised the bar in the segment even at the cost of increasing the price of the vehicle with the introduction of the third generation model in November 2006.