Honda Cars India Ltd said on Wednesday that it expects demand in the domestic market to stage a recovery from the March quarter next year.
The unit of Japan’s Honda Motor Co. also said that it will not halt any product-related investments this year, but will review other planned investments amid severe disruptions caused by the coronavirus pandemic to the domestic automobile industry.
Hence, the Japanese carmaker will continue with its plan to launch its first hybrid electric car in India in 2021.
According to Gaku Nakanishi, president and chief executive officer (CEO), Honda Cars India, sales declined during the June quarter, but has started to recover gradually in the current quarter.
“In June, our sales was almost 60% compared to last year and this kind of decline in sales will continue till the end of this year (calendar year). In the January to March quarter, the sales are expected to be as good as the corresponding period,” Nakanishi said.
“Regarding investments on products, we don’t have any change but we keep evaluating if any of our investments are necessary or not and that will not change before or after the pandemic.”
Japanese companies, such as Honda and Toyota, are more focused on introducing hybrid electric vehicles in India, unlike their Korean and European rivals who are launching battery electric vehicles.
“There will be no change in our hybrid vehicle plan. Two years ago, we shared the electrification strategy and we are going to start the production and sales of hybrid vehicle next year. Internally, to launch a new model, we have to plan almost 5 years ahead and we have almost spent 3-4 years. At the moment, we don’t have any plan to postpone the project,” said Nakanishi.
The covid-19 crisis has added to the woes of India’s auto sector, which has been battling headwinds like a liquidity squeeze and decline in consumption demand over the last year and half, which has impacted sales across categories.
According to rating agency Icra, sales of passenger vehicles will decline between 22% and 25% this fiscal.
“Some customers don’t want to use public transport and demand for entry level and affordable cars will increase and our Amaze will be a key model but now we are focusing on used car sales as well,” Nakanishi said.
Honda Cars India on Wednesday announced the launch of the fifth generation, City, a mid-size sedan, in the price range of ₹10.89 lakh to ₹14.64 lakh.
The car is offered with options of either 1.5 litre petrol or diesel engines.
The City has remained the best-selling Honda vehicle in India for over two decades.