Honda asks India to send parts to foreign markets after Thailand suffers setbacks

Monday 16 January 2012, 13:26 PM by Vikas Yogi

In the wake of floods that affected the Thailand plant, Honda Seil has asked its Indian subsidiary to supply the Latin America and South-East Asia centres with the requisite components. According to the Senior Vice-President of Honda India, Jnaneshwar Sen, India will primarily export parts for the City sedan to these markets.

Sen said, “We have been exporting mainly press parts and some engine components to countries like Argentina, Brazil, Taiwan, Indonesia, Malaysia and Philippines. Earlier, Thailand used to cater to the demands of these markets.”

The floods in Thailand have not just affected Honda's foreign capacities, but also crippled it domestically. The company used to import parts from Thailand for manufacturing three of the five cars it sells here. Due to the shortfall of components, it is able to engage only in the production of Accord and Civic till December 2011. Fortunately, the car maker was able to begin manufacturing City in India in January 2012 and expects to start developing its hatchbacks, Jazz and Brio, from February, according to Sen.

Reportedly, the manufacturer has to deliver at least 13500 cars in the domestic market, including 2000 City, 4000 Jazz and 7500 Brio models. This has led Honda to stop taking orders for the Jazz hatchback.

Moreover, the floods in Thailand affected Honda's production capacity, which adversely affected its sales by huge numbers. In April-December 2011, the manufacturer sold 32771 units, a considerable fall compared to the 44686 models it sold during the same time in 2010. However, the company has made full use of the negative conditions to train employees for 'high production situation'.