Honda Motor to make small car for Indian market

10 Jan 2007

1

New Delhi: Honda Motor is working on a small car with a 1.2 litre engine for the Indian market at its research and development facility in Japan.

The car will also serve as a global product in the small-car segment for the company. Honda officials said the company was eyeing the premium hatchback segment and the new product will conform to India's small car definition — 1.2-litre petrol engine with a length of less than 4 metre which would help it to avail of excise concessions in the country.

The company proposes to manufacture 1.5 lakh units of the car at its second manufacturing facility. The small car would be launched in another 2-3 years.

Honda has finalised an investment of Rs2,000 crore for the new manufacturing facility of which Rs300 crore will be invested in a powertrain manufacturing facility.

The new factory will have an annual capacity of 250,000 units, and is expected to start in 2009. At present Honda is negotiating with four states — Rajasthan, Uttar Pradesh, Tamil Nadu and Maharashtra — for a 150 acre plot.

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