India's bestselling premium sedan in yesteryears, the Civic has been facing tough times in the country owing to the crisis being faced by the Honda. The car maker has cancelled the launch of its latest model in India. The ninth-generation variant of the sedan has already been successfully introduced in the auto markets of US, Thailand, Australia among several other international markets in 2012. However, it would not be able to see the daylight in India because of its higher price tag and lack of a diesel version.
According to a component supplier in India, Honda Siel Cars India (HSCI) has compensated his firm for the cost incurred in developing and supplying components for the car. This is in line with the fact that the car will not be launched in the country any more. He said, “It's not coming to India, we have been told.”
On being probed about the same, HSCI did not reveal any information regarding its plans to launch the Civic sedan in India. In response to an enquiry email, the company wrote, “Thanks for your email. However we do not comment on media speculations.”
The sedan which was launched in the country back in 2006 went on to become the leader in its respective segment. However, with the hike in the price of petrol and many new models being launched in this segment, Civic soon faded out of limelight. During the 2011-2012 period, the sales of the sedan dipped to less than half to 2,296 units, This figure was way below the 8,904 units sold by Toyota Corolla Altis and 8,002 cars of General Motors Chevrolet Cruze sold in India. The major drawback with the Civic seems to be the lack of a diesel variant; it's worth-noting that all the rivals like Toyota Corolla, Chevrolet Cruze, Skoda Laura and Renault's Fluence offer diesel options.
Another component manufacturer associated with the Civic project stated that the major concern for the company while considering the Indian launch of the car is its high price. This is in wake of the fact that other cars in this segment are being offered with more competitive price tags. According to the source, the Civic priced between Rs. 13-16 lacs would have commanded a significant premium over existing cars.
Honda Motor Company, which made its debut in India back in 1995 has been the leading premium car brand for over 10 years. However, the company which ruled the segment previously is now facing tough waters in the market. According to market experts, Honda's lack of foresight and absence of a diesel launch at a time when the market trend is inclined towards diesel-run cars has cost it dearly. Another factor that led to the downfall of Honda in the country is the delay in small car launches.
In June, 2012 the volumes of HSCI went down by 23 per cent with 2,667 units sold. However, during the Q2 of this year the sales surged by 157 per cent after selling 20,076 unit owing to the shut-down of supplies in the Q1 of 2011. This was because of the earthquake and the tsunami that rattled Japan in March, 2011. According to the automotive analysts, Honda has been facing trouble maintaining its profit margins following drastic price cuts during the last couple of years.
As per a Delhi-based analyst, “The City and Jazz saw massive price cuts last years, and still sales have not been enthusiastic for Honda.” If only Honda gives up its rigid stance and launches a diesel variant instead of price-cuts, it may as well repeat the history and regain its market leader position in the premium sedan segment.
