End of road for Honda Civic, CR-V in India

Honda Cars India (HCIL) is discontinuing the premium sedan Civic and sports utility vehicle (SUV) CR-V from India with immediate effect. The company said as it shifts its entire production from Greater Noida (Uttar Pradesh) to Tapukara (Rajasthan), it has to stop production of both the vehicles as there is no assembly line at the Tapukara facility.

“The Tapukara plant is designed to be adequate to manufacture the mid-size cars, and therefore the Civic and CR-V size cannot be accommodated. And, if we invest in the existing models, then the pricing dynamics may not match the expectations of the customers, especially since the market has de-grown over the last one year,” Rajesh Goel, Senior Vice President and Director, Marketing & Sales, HCIL told BusinessLine .

He said the company is committed to its customers, and those who own a Civic or CR-V can avail all services and spare parts for the next 15 years. Honda manufactured the Civic, CR-V, City and Amaze models from the Greater Noida plant.

The new Civic was launched in March 2019, after a gap of six years since being discontinued in 2013. Honda has sold more than 6,300 units of the 10th Generation Civic since March last year, and 55,000 units of the earlier generations. It has sold 19,400 units of the CR-V since 2003.

“HCIL has decided to consolidate the manufacturing operations for vehicles and components at its Tapukara plant with immediate effect for all domestic sales and exports,” the company said.

However, all Head Office functions, India R&D Centre and Spare Parts operations (including warehouse) for automobile, two-wheeler and power product business will continue to operate from Greater Noida, it said.

Tapukara facility

“Despite an uptick in sales in the last three months, the current market conditions remain unpredictable for the industry at large. The impact of Covid-19 has pressed us to strengthen our constitution, and to achieve the same, HCIL has decided to consolidate its manufacturing operations by making the Tapukara plant a unified manufacturing base,” said Gaku Nakanishi, President and CEO, HCIL.

He said India is an important market in Honda’s global strategy, and HCIL is committed to bring its latest and advanced technology models including electrified vehicles in future.

The Tapukara plant has an installed production capacity of 1.80 lakh units per annum with all forging, press shop, powertrain shop, weld shop, plastic moulding, engine assembly, frame assembly, and engine testing facilities. Right now, the company manufactures around 10,000 cars a month including the City, Amaze, Jazz and WR-V.

When asked the Greater Noida plant would be utlisied by some other company as a contract manufacturing facility — there were reports of Chinese manufacturer FAW (First Automobile Works) Group Corporation considering this — Goel said: “Not at all. As per my knowledge nothing like that.”

HCIL has a total headcount of around 7,000 employees — 5,500 in Tapukara and 1,500 in Greater Noida. It had offered a voluntary retirement scheme to its employees in Greater Noida, and around 1,500 workers opted for it. As per sources, a sum of ₹45-65 lakh was given to each employee (salary for three years) when they left the company in two batches earlier this year.

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