India to miss Honda’s Rs 5 lakh small car

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Japanese auto major Honda on Monday said its proposed hatchback for India is not aimed at the volume-driven small car segment and will be positioned above this category.
The company, which is present in India through a joint venture with the Siel Group, is developing a hatchback for the growing Indian auto market and plans to launch it by 2011.
“Our small car project is very much on schedule. We have not decided the likely price or the engine capacity of the small car, but the small car will be positioned slightly higher than the volume market,” Honda Motor Corp. chief operating officer (Asia and Oceania), Mr Fumihiko Ike, said.
Although he did not elaborate on the “volume market”, usually cars priced between Rs 2-4 lakh account for most of Indian passenger car sales.
Some of the highest selling models in this category include market leader Maruti Suzuki’s Alto and WagonR, Korean car major Hyundai Motor’s Santro, General Motors’ Spark and Beat and Ford India’s Figo (petrol version).
“Everybody is looking at a volume-driven market, while historically our cars have always been positioned slightly higher than the volume segment,” Mr Ike said, adding the company will not bring in a sedan version of the upcoming small car.
While showcasing the proposed small car at the Delhi Auto Expo in January this year, Honda Siel Cars India (HSCI) said it would launch the car by 2011, and was at a price tag of Rs 5 lakh.
The cheapest offering from HSCI’s stable in India is Jazz, which starts at Rs 7.11 lakh (ex-showroom, Delhi).