Honda launches new manufacturing facility in Rajasthan

In line with its target of achieving a sales target of 3 lakh units in the Indian market by 2016-17, Honda Cars India today inaugurated its second manufacturing facility at Alwar in Rajasthan, a move aimed at doubling the company’s production capacity in the country.

The Rs 3,520-crore plant, which has a total production capacity of 1.2 lakh cars per annum, effectively doubles the company’s total manufacturing capacity to 2.4 lakh cars per annum.

"With the inauguration of this second plant, we have doubled our production capacity in India. This plant is significant as it will help us realise the target of selling 3 lakh units in the country by 2016-17," Honda Cars India Ltd (HCIL) President and CEO Hironori Kanayama told reporters here.

The new manufacturing facility, which employs about 3,200 people, will have a starting production capacity of 60,000 units in a single shift, which would be enhanced as per the market demand, he added.

The company would utilise the 450-acre plant to produce Amaze sedan and later decide on producing any other models, depending on market demand. Rajasthan Chief Minister Vasundhara Raje inaugurated the plant.

"We will produce both petrol and diesel variants of Amaze here. The production ratio of petrol and diesel variants would depend upon the market demand," said Kanayama, adding that the production of compact sedan would also continue at its Greater Noida plant.

In order to reduce Amaze's waiting period, Honda Cars had started third shift at its Greater Noida facility in November last year. The plant has a total capacity of 1.2 lakh cars per annum.

The company, which had sold 73,000 units in 2012-13, has already sold one lakh units in the current fiscal (April 2013- January 2014).

When asked about the introduction of new models in the country, Kanayama said: "We will launch Mobilio (multi purpose vehicle) by the second quarter of next fiscal and Jazz before the end of the next financial year."

Honda Motor Company Managing Officer Yoshiyuki Matsumoto said the company has an annual target of 12 lakh vehicles for the Asia Oceania region by March 2017. "Honda Cars India, which is part of the region, will contribute 25 per cent of the region's sales by 2017, by selling 3 lakh cars per annum," he added.

Tapukara plant, which started producing engine components in the first phase way back in 2008, will play a substantial role in HCIL’s long term growth, Matsumoto said.

He added that over the next few years the plant would become a major hub for exporting both diesel and petrol engine components and other parts to Honda plants in Southeast Asia.

"HCIL’s targeted export turnover for 2013-14 is about Rs 350 crore. This will grow significantly as HCIL expands its exports," he added.