Japanese carmaker Honda is pinning hopes on its upcoming compact crossover WR-V and the new City sedan to rev up its India sales in the next fiscal.
The company has sold a total of 1,24,114 units in the April-January period this fiscal, a decline of 23.2 per cent.
"Last year we were in a run out period of previous models and now we have launched the new City and the WR-V will be launched in this fiscal but the real sales will happen in the next fiscal year," Honda Cars India President and CEO Yoichiro Ueno told PTI.
Honda plans to launch the WR-V on March 16, while the new City sedan was introduced last month.
"Hopefully, these two models will add to total sales volume of the company in the next fiscal," he said.
Sharing the strategy for the W-RV, he said Honda is looking to position the model a bit differently from compact SUVs such as Maruti's Vitara Brezza or Ford EcoSport.
"Our direction is, to kind of, creating a new segment with this model," Ueno said.
The sub-4 metre SUV segment is rapidly growing in the Indian market selling around 2 lakh units annually.
On sales expectations from WR-V he said: "We are expecting some good sales but not huge may be because we are newcomers. Market is growing, however, models are also increasing." Ueno said although some customers could compare between WR-V and the Jazz, HCIL is not expecting "cannibalisation" between the two.
"It's the synergy of these models that we think can capture a broader range of customers," he added.
The new City has also gained traction in the market and sold 6,318 units last month and received over 10,000 bookings since its launch on February 14.
When asked about the company's plans for a third plant in Gujarat, Ueno said the investment has been done keeping in mind future growth potential of Indian market.
"The decision of Gujarat plant was taken couple of years back. At that time our volume was smaller, however, we expect Indian market to grow. In the near future, it may be one of the top three biggest markets (in the world)," Ueno said.
He, however, said the company currently has no plans to expand capacities in India and the purchase of land in Gujarat was to prepare for the future.
"It is kind of pre-investment for the future expansion," Ueno said.
Currently, HCIL sells around two lakh units annually, while its production capacity stands at around 2.4 lakh units from its two plants in Greater Noida and Tapukara (Rajasthan).
"The Tapukara plant can be further expanded. I think for several years, we can manage our sales from two factories. If sales grow this land (in Gujarat) can be one option to expand.
We haven't yet finished purchasing the land," Ueno said.
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