Japanese carmaker Honda has had what one would describe as a middling experience in India over the past few years. Even though the company set up shop in December 1995 and started production in 1997, they crossed the two million-unit production milestone only in November 2022. Just for comparison, Kia Motors will cross the one million production mark after just four years of operation in India later this year if current sales figures hold up.
According to wholesale data from the Society of Indian Automobile Manufacturers (SIAM), Honda sold 91,418 vehicles in the financial year 2023 (FY23), a growth of 6.8 per cent over the previous year. Kia sold 2,69,229 vehicles, a growth of 44.1 per cent. The overall Indian car market registered sales of 38,90,114 passenger vehicles in FY23, a growth of 26.7 per cent.
However, the comparison is not really fair. Kia entered the market after years of market research thanks to their sister-brand Hyundai. And they entered the compact SUV segment, also known as the C-Segment SUV, with the Kia Seltos, just as it was booming. The Seltos has smashed sales records for a vehicle in its segment, with half a million units sold since its launch in August 2019.
But now, Honda Cars India Limited (HCIL) has the new Elevate to compete with best-sellers like the Seltos and the Hyundai Creta. Last year, Maruti-Suzuki launched the Grand Vitara and Toyota launched the Hyryder to do just that and break the Korean stranglehold on the segment. They have had good sales success. But can Honda do the same? Or is it too little too late?
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Future plans
Takuya Tsumura, president and CEO, HCIL told me that the company will double down on its ‘SUV’ strategy. “The Elevate will be the first of five new SUVs we plan to bring to the Indian market by 2030.” One of these will be an electric version of the Elevate, which will hit these streets within the next three years.
“Honda has a global commitment to producing 100 per cent zero-emission vehicles globally by 2040, and India is part of that plan,” he said. However, it was a surprise to many that Honda did not launch a Hybrid version of the Elevate, particularly since the Honda City sedan features such a drivetrain. For Honda’s Japanese compatriots, Suzuki and Toyota, the hybrid drivetrain versions of their SUVs have been huge hits thanks to the incredible fuel economy they offer, albeit at a much higher sticker price.
Tsumura and Honda are betting the company’s success more on the fact that the Elevate will feature the ‘Honda Sensing’ suite, a plethora of advanced driver assistance system (ADAS) features that will be a first in the segment. “Honda Sensing is one of Honda’s global pillars, we plan to eliminate pedestrian deaths from Honda Cars globally,” Tsumura said, adding that the second generation of the suite has been launched globally and would be coming to India as well.
There is also the case of Honda’s enduring popularity with buyers which is evident in the large turnout for the launch of the Elevate.
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Tough competition
However, turnouts and positive media coverage do not equate to sales. Kunal Behl, president, marketing & sales, HCIL, believes that many Honda sedan buyers who switched over to other brands to buy an SUV will come back to the Japanese carmaker with the Elevate. “I would like to believe that there is a huge amount of brand loyalty among Honda owners and with the Elevate promising the same Honda efficiency and ride quality, buyers who want SUVs will come back to us.”
The exterior design of the Elevate while described as ‘bold and masculine’ felt a bit conservative compared to the competition. The design of Honda’s sedans has the same issue. The interiors of the vehicles on display looked plush and the top variants of the Elevate have much larger infotainment screens. While it has a sunroof, it lacks the twin-pane ‘panoramic’ version that is the rage among its competitors. Although as I have written before, I genuinely do not understand why Indians are obsessed with sunroofs, particularly given that it is incredibly hot (or wet) outside.
But the Elevate already has some tough competition. Kia is giving the Seltos a mid-life update that will include a new turbocharged petrol engine, similar to the one of the Hyundai Verna as well as an ADAS package. French carmaker Citroen is also wading into this segment with their C3 Aircross. While sales are still strong for Honda there are potential headwinds in the market with the US economy slowing down. But for the Indian car buyer, times have never been so good!
@kushanmitra is an automotive journalist based in New Delhi. Views are personal.
(Edited by Theres Sudeep)