With the launch of its mid-sized, sports utility vehicle (SUV) Elevate on Tuesday, Honda Cars India (HCIL) is on course to launch five more SUVs in the next six years. The company is also planning to launch a battery electric vehicle (BEV) based on Elevate in India within the next three years. But HCIL is also not planning to bring back any of its hatchbacks into the Indian market now. In an interview with businessline, Takuya Tsumura, President and Chief Executive Officer, HCIL, shares more. Excerpts.


What product line-up are you planning now to acquire better market share in India?

Honda is planning to launch five SUVs before 2030 and Elevate is the first model to start with, and other four models will follow. Elevate will be available in petrol and there will be a battery electric (BEV) model on the same platform in the next three years. Honda’s two-third of the models will be EV or hybrid by 2030, and by 2040, 100 per cent of Honda’s portfolio will be fuel-cell and BEV. So we are aligning the same for the Indian market.


What is your business target in future apart from these three models -- Amaze, City and Elevate?

Amaze and City are playing only in 10 per cent of the passenger vehicle (PV) market, but SUV has 40 per cent of the total PV market right now and growing year-on-year. Overall, the market is big and we are also participating in this segment now.


So what are your expectations from the SUV? What kind of market share are you looking at in this segment?

We are not chasing market share right now but we are expecting around 35 per cent growth in the second half of this fiscal year (September to March) as compared with the second half of last fiscal. Our production in the factory will also increase from 540 cars a day currently to 660 units production per day. Once we start production of the Elevate, we will touch that number per day and may be more, depending on the demand.


Elevate is entering into the most competitive segments right now like the Hyundai Creta, Kia Seltos or Maruti Suzuki Grand Vitara. How do you plan to compete?

On a daily basis, we are getting almost 10,000 of enquiries on the Elevate page on our website. So definitely the response is big and beyond our expectations...there is a lot of anticipation around the Elevate and at the dealerships level also, the enquiry level is high. That is creating a lot of confidence for us. The Elevate has basic Honda DNA with ‘man maximum, machine minimum’. We are giving a fully-loaded SUV with bold and masculine design, strong safety package with advanced driver assistance system (ADAS) of Honda Sensing and overall comfort for both the driver and the passengers. We are quite focussed on form and functionality of the vehicle. It has best in class interiors -- both in terms of cabin space as well as boot space -- that will differentiate us from the others.

Also read: Honda Cars will never leave India market, says Country Head


But, how about the confidence level among customers for the brand Honda? Since you have discontinued so many products, do you think customers still have that loyalty for brand Honda?

In January, we showed the Elevate to our dealers in Thailand and the feedback was very good. That is why it makes us confident about this product...actually this product is made for India. Indian customers look for premium/ exclusive design. It shows a lot of confidence...it will have all the features and technology that a customer look for.


How challenging is the supply chain issue at the moment, especially with semiconductor shortage?

It is much better than the last year...we see some constraints here and there, and semiconductor issue is remaining. But, so far, at this moment we are not seeing much of a challenge and as I said we are expecting to grow higher by around 35 per cent in the second half of this fiscal, so we are quite confident of meeting that target. There is some problem in semiconductor supply and it had an impact. But, globally Honda Motor understands how India is important and that is why they prioritise the supply chain accordingly. We were having a tough time until three years back, but in last two years, we have started on a recovery path. Last year our financial results were quite good and that is why now we have expansions planned...as Honda India, we are the second largest in the Asia/ Oceania region. Even globally, Honda India is bigger than Japan now in terms of importance, and that is why we are pushing for more grants and future products.


What’s happening to your Greater Noida plant which is not functional for a while now? Are you giving it for some contract manufacturing?

We have enough capacity at the Tapukara (Rajasthan) plant. We will increase the capacity from time to time till there is 100 per cent utilisation. After that depending on the situation, and market conditions, we will consider on other plans. We produced 1.2 lakh vehicles last year and total capacity is 1.80 lakh units which can also be expanded to two-lakh units per annum. At this moment, the Greater Noida plant has the Indian operations headquarters, our India R&D centre, and our after sales service parts from there. So at this moment, we have no plan to give it for contract manufacturing...we are studying many things but right now we have no details to share.


What are your plans on export for the Elevate?

India will be a key export hub for this mode in future. Last year, we exported 20 per cent of our total production from India. Currently we are exporting to around 14 countries including Turkey, Mexico, West Asia, South Africa, and we are also exporting semi-knocked down parts/engines to around 10 countries from the Tapukara plant. We generated around ₹1,000 crore from parts exported last year.


Would you bring back the hatchbacks to the Indian market?

At this moment, we have no plans and we will stick only on SUVs.