Honda Brio Diesel, sub-Brio small car put on backburner

Snapshot: A diesel version of the Brio hatchback is not in the scheme of things. Also put on the back burner is Honda’s plans of building a sub-Brio small car. The focus will be on the 5 lakh rupee to 10 lakh rupee segments consisting of cars such as the Brio, Amaze, Jazz, City, Mobilio and Brio-based compact SUV.

Honda Cars India’s CEO Mr Hironori Kanayama, has ruled out the Brio Diesel for the Indian car market. With this development, the diesel powered cars that Honda will sell in India will include the Amaze compact sedan, Jazz premium hatchback, Mobilio MPV, the City C-Segment sedan and possibly the Brio-based SUV.

The least priced car in Honda’s line up, the Brio will continue to be sold with a 1.2 liter i-VTEC petrol engine that outputs 88 PS of peak power and 110 Nm of peak torque. The Brio is sold with 5 speed manual and automatic gearbox options.

Also on the backburner is Honda’s plans of building a sub-Brio small car, to move lower down the pricing chain. A sub-Brio small car would have given the Japanese automaker a chance to square off against car makers such as Maruti Suzuki and Hyundai, the top two car makers in the country whose market share is driven mainly by their ranges of entry-level hatchbacks.

By eschewing the sub-Brio hatchback segment, Honda Cars India seems content at running its two factories, one at Greater Noida, off Delhi, and the other getting its finishes touches at Tapukara, Rajasthan.  Honda’s announcement also hints at its reluctance to invest in additional capacity for the Indian car market.

As of now, the Greater Noida factory is capable of building about 120,000 cars each year. The Tapukara factory, ready to begin production by April 2014, will add another 120,000 cars of yearly capacity. These factories can be expanded to give Honda a total yearly capacity of about 300,000 cars, which is pretty much what the car maker will need if the City, Jazz, Mobilio and Brio-based SUV turn out to be good sellers.

On the other hand, a small car in the Alto 800/Eon space with the Honda badge on the bonnet is capable of bringing in another 10,000 monthly units if priced well. Honda production capacity of 240,000-300,000 units will prove inadequate.

Source TheEconomicTimes