Honda Siel Cars expects double digit sales growth this year

Honda Siel Cars India (HSCI), the Indian subsidiary of the Japanese giant Honda Motor Co, today said that its sales will register double digit growth in the current financial year. The company expects its total sales to be around 60,000-65,000 units during the current year, up from 55,250 cars sold in 2008-09.

Tatsuya Natsume, director-marketing, HSCI said the growth in India sales will happen mainly due to the introduction of its new global car, Honda Jazz. The company has already received bookings for more than 1,000 cars of Jazz in the last few days.

"The Indian economy is showing signs of recovery and we expect automobile industry will bounce back shortly. For Honda, the market is looking up due to our portfolio enhancements and we will register double digit growth this year," he said.

The company, he said, will most probably resume its investment programme at Tapukara plant in Rajasthan, in the next financial year to expand its production capacity. The company, which currently has a capacity to produce 1,00,000 cars per annum at Greater Noida, is planning to add an additional 60,000 units at Tapukara.

"We intend to launch our new small car in India in the next two years and by then also increase our installed capacity. Actually, our capacity expansion is not linked to new car launch. It depends on the capacity utilisation at Greater Noida plant. Once we utilise that capacity fully, we will go for expansion of capacity in our second plant in Rajasthan," Natsume told reporters after launching its new global car, Honda Jazz, here today.

HSCI has already invested Rs 600 crore at its Rajasthan plant and the remaining Rs 400 crore will be invested to add another 60,000 units per annum.

Natsume said, Honda has commenced work at its India R&D centre earlier this month at Noida with three engineers deputed from Japan. It plans to recruit 10 R&D engineers to begin with in India and increase the headcount over the years. He, however, did not divulge the amount spent on R&D in India. Globally, Honda spends around $50 billion, which is 5 per cent of its annual sales turnover, on research and development.

Already, Honda has R&D centers in Japan, US, UK, Brazil, Germany and Thailand. The Indian R&D Centre will work towards increasing local contents in its cars produced in India.