Honda car sales dip for 8th month

It's position in domestic passenger vehicle market has slipped from 4th in FY16 to 7th in the April-June quarter

Japanese car maker Honda’s sales to dealers have declined for eight consecutive months in a growing market.

Its position in passenger vehicles has slipped from fourth place in 2015-16 to seventh place in the April-June quarter. Tata Motors, Toyota and Renault have sold more.

Honda previously posted an increase in sales in October 2015, on festival demand. The declining numbers come with an expanded product portfolio. It launched the Jazz in July 2015 and the BR-V in May. But, sales declined 28 per cent to 31,847 vehicles in the last quarter. The decline is driven by a steep fall in sales of its star sedan, the City. In April-May, sales of the City declined 42 per cent to 9,098. Sales of Maruti Suzuki’s competing Ciaz sedan grew 12 per cent in the same period to 10,890.

The City is 18 years old although it has had a series of re-launches. The Ciaz was launched in October 2014 and emerged as serious competition. Sales of Honda’s Amaze and Brio cars have also declined. The new Jazz, which clocked average monthly sales of 4,600 last year, sold only 3,342 in April-May. The BR-V compact sports utility vehicle  sold 2,900 in May. Honda’s market share in India declined from 7.6 per cent in the first half of 2015 to 5.6 per cent in the same period of 2016.

“The factor that affected our business is the sudden shift in fuel preference from diesel to petrol,” said a Honda spokesperson.

“The shift led to a high stock of diesel vehicles at our dealerships. We are rationalising wholesale dispatches.”

The shift from diesel has, however, not affected sales at Maruti Suzuki and Hyundai. Even Mahindra & Mahindra, which mainly makes diesel vehicles, continues to grow.  

The 2016 JD Power Dealer Satisfaction Index ranked Honda at fifth position, after Toyota, Maruti Suzuki, Hyundai and Renault. The 2015 study had placed Honda at third spot, after Toyota and Maruti Suzuki. Dealer satisfaction is determined by marketing and sales activities, product, vehicle ordering and delivery, and training.