Sunday, November 15, 2009

Honda has no Plan to Launch a Mini Car in India

Earlier, it was expected that Japanese automaker Honda would also jump into the recent trend of making low-cost minicar for the Indian market in order to capitalize on the price-sensitive Indian market. However, Honda has now revealed that it would rather launch a small car in India which would cost less than its Jazz passenger car.

Tata started the trend of launching low-cost car in India when it came up with its Nano model which is available for a starting price of Rs. 1,15,000 (Indian rupee). Car enthusiasts in India jumped on the model in a recession hit economy. Renault-Nissan alliance, General Motors and Hyundai Motor have all announced to bring out their own mini car in India. In fact, Honda was also initially keen to get into market, but has now come back from that plan. Honda Siel Cars India Ltd, the Indian unit of parent company Honda Motor Co., is now determined to produce a small car which would cost car enthusiasts less than Jazz hatchback car.

So, it seems that Honda does not want to target the primary level of the market. Rather, it aims to target the mid-range market. Well, Honda may think that economic recession is going to be over and Indian middle class families would not mind spending 3-4 lakh for a car that would provide much more features than what Nano gives. Moreover, with many companies entering into the low-cost segment, there could be huge competition. So, Honda now wants to play it safe by focusing more on the mid-range segment.

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