Honda Cars India bets on components exports from India

The company exports forgings, transmissions, and other engine components from India to countries like Japan, Thailand, Malaysia, and Indonesia

Japanese car major Honda Cars India saw a 164 per cent jump in component exports from India last financial year when compared to 2013-14. 

Component exports from India have seen a steady growth as the company focused on using the country as a low-cost manufacturing base for quality components needed at Honda plants worldwide. 

Honda Cars India Senior Vice-President (marketing and sales) Jnaneswar Sen said that recently the company started exporting the 1.6-litre diesel engine made here to Thailand. "We have been exporting transmissions and other engine parts from our Tapukara facility in Rajasthan to a host of global operations. It has been growing steadily," he said. 

The company exports forgings, transmissions, and other engine components from India to countries like Japan, Thailand, Malaysia, Indonesia, and others. From July 2017, it has also commenced exports of fully-assembled diesel engines. 

Exports have grown from Rs 443 crore in FY14 to Rs 737 crore in FY15. They touched Rs 1,036 crore in FY16. In FY17, the company exported components worth Rs 1,140 crore and that figure is expected to see a huge boost this financial year. 

It has two plants in India — one at Greater Noida and another in Tapukara. Their combined capacity to produce cars is 300,000 units per annum (with some tweaking). During the first half of this year, the company has sold around 91,000 units in the domestic market and has exported 2,724 units during the same period. 

Sen said, "We have idle capacity that can take care of our production requirement for the next two years." It is also in the middle of acquiring land in Vithalapur in Gujarat. A major portion of the land has been acquired, informed officials. Honda Cars is looking at a 400-acre site near the Honda Motorcycle and Scooter India plant here. 

This, however, is for the long term as the company's current production capacity is sufficient to take care of immediate needs. Thus, the focus is on making engine components. The engine plant utilisation at Tapukara is around 80 per cent or so despite its sluggish sales in the domestic market. The Tapukara engine plant can make 180,000 engines per year and is one of the largest manual transmission and diesel engine manufacturing facilities for Honda globally.