The company’s new small car, to be launched in 2011, will provide the company a much-needed second pillar of business after the City.
Honda recently shipped saris from India to its factories in Japan. No, sari weavers need not brace themselves for competition from Japan. These were meant for local Japanese women to wear. Clad in saris, they got in and out of a small hatchback a number of times, while a team of designers and engineers keenly observed them. They wanted to check if Indian women can enter the car comfortably? Is the height right for them? Should the door be redesigned?
Honda is readying a new small car. Though it will be sold across all continents, its principal market will be India. And the world’s sixth-largest car maker wants to leave nothing to chance. The fabric on the doors, for example, will be different from the one on the seat, though they will look alike. This is because for over ten months in a year, Indians wear short sleeves. As the elbow touches the door, its lining has to give more comfort to the skin. The air-conditioner will be a notch or two stronger because of the scorching heat in the country.
Though it is a mass-market brand in most countries, Honda’s market share in India is small — just around 4 per cent. If Honda wants to play the volumes game here, it needs a small car in its product portfolio desperately. Without it, Honda has no presence in 82 per cent of the market. At the moment, the City accounts for 70 per cent of Honda’s sales in India. Nowhere else in the world does a single car have such a huge share of its business! This makes the need for a small car all the more acute. Honda needs a second pillar of business after the City.
Though Honda makes the Zest and Life (called Kei cars) in Japan, the need was felt for a brand new car for India. The new car, which was showcased at the recent Auto Expo in New Delhi, is yet to be named. It will be launched towards the end of 2011. To qualify as a small car, and thereby get excise duty concessions, it will be less than 4 metres in length and will have a 1,200-cc engine. It will be the biggest initiative from Honda in India. If it succeeds, the small car could be a game changer. If it doesn’t, it will set Honda back by several years. The stakes are huge. Here’s how Honda has gone about it.
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