The company has decided to move the Civic out of India, nearly a year-and-a-half after the new-gen version of the stylish sedan had made its debut at the end of the first quarter of last year.
The model, which was re-launched in India after a period of around six years amid much fanfare with an entry price of Rs 17.5 lakh (ex-showroom), had, however, been struggling to gain strong volumes, making a weak case for additional investments to set up its production at the Tapukara plant in Rajasthan.
It’s the same case for the CRV which, priced at Rs 28 lakh (ex-showroom), never really made any credible dent in the market and had been a fringe player at most of the times when it came to volumes and market share.
“It’s a tough call, forced upon us due to the decision to stop production at the Greater Noida plant… Production of the models at Tapukara would have meant that we recover the additional investment costs through higher retail prices, something which would be unfair to the customers. Thus, we have decided to stop the production of the two models,” Rajesh Goyal, director (sales & marketing) at Honda Cars India, said.
All spare and service support for the models will be available for customers.
Goyal said that the new strategy of Honda will help increase operational efficiencies, while making the company nimble to handle future challenges, including heightened competition.
“We are here to stay and want to participate in the growth story of the economy and the car market. However, it is time to de-risk the business and make it sustainable. This sounds tough, but these changes are being made to survive, sustain and be here for the long haul.”
The company said that its mid- to long-term product investment plans remain unchanged. “There is no change in new product launch plans. We are not curtailing and changing plans and remain committed to India growth story.”
The company, which gets the majority of its sales from Amaze and City sedans, is understood to be working on a mass-priced SUV, which is likely to be priced under Rs 10 lakh. However, the model is around a year away even as rivals are introducing new models. “We don’t have a full line-up of SUVs, like we have for sedans,” Goyal conceded.