It’s a fantastic comeback story for one of the most popular cars in India, the Honda City. In February, Honda sold 6,052 units of the City, as production got back on track after twin disasters last year.
First Honda was hit by the tsunami in Japan a year ago and then badly affected by floods in Thailand in the later part of the year, which completely threw production off track.
Honda launched a refreshed City in December, giving it minor cosmetic upgrades, and changing the feature list of its variants. Yet, it could not make enough to meet demand, selling only 600 that month and 1,500 the next month, handing the sales on a platter to competitors such as the Hyundai Verna and the Volkswagen Vento, with the Verna selling an average of 4270 cars in the same three months, while Vento sold an average of 2,250 cars.
City overtakes Verna
In February, though Honda’s sales have knocked the leader, the Verna, off the top. But it’s not as if Honda has done something exceptional to get the City’s sales back on top. The pent up demand of the bookings over the past few months were met in February after its plants got back to working at full capacity and component import has been normalized. The fact remains that Honda continues to be a petrol only player, competing with the Verna and Vento which are available in both petrol and diesel.
Sunny’s sun shines
Speaking of diesel vehicles, one sedan that has benefited hugely from the launch of a diesel variant is the Nissan Sunny. The Sunny was selling an average of 915 cars in the first four months of its launch, when it was available only in a petrol variant, but after the introduction of the diesel variant in December, sales have surged to an average of nearly 3,200 cars making it the third largest selling sedan in the Rs. 7 lakh to Rs. 10 lakh category, although the Sunny actually competes from Rs. 5.78 lakh onwards (with the Etios, Dzire and Manza, right up to the SX4 and Vento).
Fiesta needs a rethink in pricing
Ford has had a bit of a bad run with the Global Fiesta. It’s a brilliant product, let down by expensive pricing. The company sold a paltry 77 Fiestas in February, if these sales dispatch numbers are true. Even earlier the company has been selling an average of about 680 cars a month, not satisfactory enough. Now with the launch of the automatic at attractive pricing, the company will also be changing some of its variants. We hear it will be narrowed down to four petrol (including two automatics) and two diesel variants, at better prices.
The Union Budget is around the corner, and there could be some skew in demand in back in favour of petrol cars if taxes on diesel cars bite hard. However, with a fresh round of petrol price hikes likely, that demand skew may not really take place.