Honda Cars India clocks 83% growth in March, City clocks higher sales in Tier 1 cities

Honda Cars India has recorded its highest ever monthly domestic sales of 18,426 units in March 2014 and registered a growth of 83.45 percent (March 2013: 10,044). The recently launched City sedan contributed to 9,518 of those sales. The March 2014 sales break-up was: Brio (1,456), Amaze (7,374), City (9,518) and CR-V (78).

Autocar Professional learns that the fourth-generation City is recording higher sales in Tier 1 cities in India. Tier 1 cities, with a 44 percent share, are the biggest contributor to City sales; Tier 2 towns contribute 33 percent and Tier 3 towns 23 percent.   

According to Jnaneswar Sen, senior VP (sales and marketing), Honda Cars India, the diesel-engined City accounts for 70 percent of total sales compared to the 30 percent for the petrol City which rolled out in February. He revealed that both models at present have an average waiting period of three months, albeit the diesel City could take 5-10 days more. The stylish new sedan has sold 23915 units in January-March 2014.

Meanwhile, the carmaker has also posted its highest ever annual sales of 134,339 units during FY 2013-14, recording an 83 percent growth (2012-13: 73,483), thanks to strong market demand for the Amaze and the new City. The company has also increased its export volumes by 121 percent, shipping 5,798 units in FY’14 compared to 2,622 units in the previous financial year.

Sen attributes the higher sales of the City in Tier 1 cities to the nature of the markets which prefer a more expensive car compared to the Honda Amaze saloon. The Amaze, being the lower priced sibling, has mustered more popularity in smaller Tier 3 towns. The Amaze is averaging sales of around 6,000-7,000 a month with November 2013 seeing 9,000 plus units being sold due to pending demand.  In March it sold 7374 units. Overall it has sold 80,263 units since its launch last year.

Like the City, the Amaze too has a waiting period. Despite also being manufactured in the new Tapukara plant in Rajasthan, the wait for a new Amaze has not come down from the earlier three-week period,  due to a steady demand from across the country. At present, the facility is running one shift that is in the process of normalising.

Meanwhile, Honda is not ready to commit whether the Mobilio MPV, the next model to be available in both petrol and diesel trim and slated for a Q2 FY’2015 launch, will also be produced at Tapukara.  Installed capacity at the Greater Noida and Tapukara plant together stands at 240,000 units per annum.

“With both manufacturing plants in operation, as well as two new models, the stylish midsized MPV, Honda Mobilio and the all-new Jazz due for launch this financial year, we look forward to another year of growth. We will increase our dealer network by 35 percent in this year by reaching out to more Tier 2 and Tier 3 markets which will be instrumental for our growth,” he added.  

On the dealer front, Honda Cars India achieved its target of adding 11 more outlets by end-March, taking up the count to 170 outlets across 107 cities from the existing 159 outlets.