Active Stocks
Fri Sep 29 2023 15:59:14
  1. Tata Steel share price
  2. 129 1.78%
  1. NTPC share price
  2. 245.65 3.3%
  1. Power Grid Corporation Of India share price
  2. 199.85 -0.45%
  1. State Bank Of India share price
  2. 598.7 1.48%
  1. Wipro share price
  2. 406.25 0.11%
Business News/ Companies / News/  Honda’s new SUV aims to Elevate sales by 35%

Honda’s new SUV aims to Elevate sales by 35%

Honda Cars India is launching a new mid-sized SUV, the Elevate, which it believes will drive sales up by 35% in H2 FY22. The company aims to release five new models by 2030, with a fully-electric model based on the Elevate due by 2026. It has also pledged to ramp up production and focus on delivering the car during the festive season. Honda Cars India is aiming to cover 40-45% of the total passenger vehicle market share with its new SUVs. The Elevate will be petrol-only, though other new SUV models may have hybrid powertrains.


NEW DELHI : The local arm of Japanese automaker Honda Cars is making a strategic comeback into India’s rapidly expanding passenger vehicle sub-segment, with the launch of a new mid-sized sport utility vehicle (SUV)—the Elevate.

The carmaker expects the new product to propel sales by 35% in the second half of the financial year, surpassing 2021-22 figures, as it intends to increase production and focus on delivering the car during the festive season, said a top company official.

Elevate will face stiff competition from established rivals such as Hyundai’s Creta, Kia Seltos and Maruti Suzuki’s Grand Vitara, in this fiercely contested segment.

Honda has laid out comprehensive SUV roadmap for the Indian market, aiming to launch five new models, including the Elevate, by 2030. It also plans a fully-electric model based on the Elevate by 2026.

Despite its long history in India, Honda Cars India Ltd has encountered challenges in gaining a significant foothold in mass-market passenger vehicles segment, due to its premium pricing compared to most original equipment manufacturers.

Takuya Tsumura, chief executive, Honda Cars India, said the automaker will price SUVs competitively and cover 40-45% of total PV market which derives sales from SUV segment. The company is ramping up manufacturing at its Rajasthan facility, and expects to hit 180,000 units in annual sales in three years. Honda has been profitable for last two years and hopes to sustain profitability, he said.

“We understand SUVs are important and we have to bring them to mainstream. That is why we developed the Elevate for India, and the price must also reflect that. We may price a little bit higher than some models but it’s not like we will position it too high," Tsumura added.

The Elevate will exclusively be available in a petrol variant, as the company expects demand for hybrid vehicles to remain limited, with rival OEMs like Suzuki and Toyota ramping up their play in the segm-ent, but other SUV models Honda brings in could have hybrid powertrains as well.

However, with rivals Suzuki and Toyota aggressively expanding their presence in the segment, Honda aims to differentiate itself by exploring hybrid powertrains as well for other new SUV models.Honda Cars India discontinued its diesel engines in India completely earlier this year, and will not bring them back in light of India’s emissions reduction requirements as well as the company’s global roadmap to electrify two-thirds of its product portfolio by 2030, and 100% by 2040.

“After some restructuring three years back, for the last two years we are back to black. Business is picking up but we have only three models, Amaze, City and City HEV, especially after RDE regulations came in force in April. So, we are participating in just 10% of passenger car market. Now, with the new SUVs we will enter 40-45% of the market. In our estimate, in October-March, we will grow our sales by 35% in FY23," he said. “We are prepared. Our production last year was 540 units per day, and now it is at 660 units at our Rajasthan factory."

In terms of global sales, India ranks 6th or 7th for Honda. However, in India, it has slipped to seventh place, after its sales for May dipped 41% to just 4,660 units.

Meanwhile, MG Motor India managed to surpass Honda, securing the sixth position. The erosion in market share can be attributed to Honda’s scaled-back product portfolio, which no longer offers the same breadth and variety as before.

Honda currently has an installed capacity of 180,000 units, which can be expanded to 200,000 units by putting in an extra shift. Exports to countries in South Africa, Middle-Eastern Countries and Mexico account for 20% for Honda Cars India’s total annual sales.

"Exciting news! Mint is now on WhatsApp Channels 🚀 Subscribe today by clicking the link and stay updated with the latest financial insights!" Click here!

Alisha Sachdev
Alisha Sachdev is an assistant editor with Mint based in Delhi. She reports on the auto and mobility sector, with a special focus on emerging clean mobility technologies. She also focusses on developing multimedia properties for Mint and currently hosts the 'In A Minute' series and the Mint Primer podcast. Previously, she has worked with CNBC-TV18 and NDTV.
Catch all the Corporate news and Updates on Live Mint. Download The Mint News App to get Daily Market Updates & Live Business News.
More Less
Updated: 06 Jun 2023, 10:47 PM IST
Next Story
Recommended For You
Switch to the Mint app for fast and personalized news - Get App