The Hindu Business Line : Honda Motor proposes to roll out a car smaller than Jazz

City in limelight: Mr Takeo Fukui, President & CEO, Honda Motor Company, Japan, and Mr Masahiro Takedagawa, President & CEO, Honda Siel Cars India Ltd, at the launch of the Third Generation ‘Honda City’ in the Capital on Thursday. —Kamal Narang

Our Bureau

New Delhi, Sept. 25 Honda Motor Company on Thursday said that with oil prices rising there was a need to produce cars smaller than Jazz.

Currently, Jazz is globally the smallest model in its portfolio and is likely to be the car which Honda plans to roll out from its second plant at Rajasthan later in 2009.

The company’s President and CEO, Mr Takeo Fukui, said, “With rising oil prices, mileage of a car will be an important factor in the future. There will be need for a car smaller than Jazz.” He said the company was developing a car that would suit the need for India and the global market. Mr Fukui said that the way forward for Honda was to launch small and affordable hybrid engines and recognise the significance of diesel engine in its portfolio.

Honda had earlier said that it would be launching two small cars in the country which would qualify for the excise duty benefit. To meet the regulations, Honda’s Jazz which globally comes with a 1.5 litre engine, is expected to be equipped with a 1.2 litre engine in India.

Mr Fukui was addressing the media at the launch of its third generation sedan, City. Priced between Rs 7.7 lakh and Rs 8.9 lakh (ex-showroom Delhi), the new City comes with a 1.5 litre i-VTEC engine and would be available in three different variants with both automatic and manual transmissions. While the bookings have started from Thursday, deliveries would begin only by end of October. That would also be the time by when Honda would begin the production of its new City. The company said that it would take time to meet the demand for the new model which replaces the existing model, thereby resulting in low sales during September-October.

Honda also said that it was hoping to source more components from the Indian vendors to supply to countries in nearby countries with the Asean FTA likely to be in force next year onwards. With regard to export opportunity from India, Mr Fukui said that the current capacity would only meet the domestic demand and it would not look to sell overseas in the near future.