Read this Article : Honda's "Small" Move, Few important excerpts from same:
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Honda is readying a new small car. Though it will be sold across all continents, its principal market will be India. And the world’s sixth-largest car maker wants to leave nothing to chance. The fabric on the doors, for example, will be different from the one on the seat, though they will look alike. This is because for over ten months in a year, Indians wear short sleeves. As the elbow touches the door, its lining has to give more comfort to the skin. The air-conditioner will be a notch or two stronger because of the scorching heat in the country.
Though Honda makes the Zest and Life (called Kei cars) in Japan, the need was felt for a brand new car for India. The new car, which was showcased at the recent Auto Expo in New Delhi, is yet to be named. It will be launched towards the end of 2011. To qualify as a small car, and thereby get excise duty concessions, it will be less than 4 metres in length and will have a 1,200-cc engine. It will be the biggest initiative from Honda in India. If it succeeds, the small car could be a game changer. If it doesn’t, it will set Honda back by several years. The stakes are huge. Here’s how Honda has gone about it.
The second learning was that almost every customer looks for value for money in his car. This gets captured in the lifetime cost of acquisition — the price tag, fuel efficiency, cost of service and spare parts, and resale value. Honda has decided to price it below Rs 500,000. “This will be the cheapest Honda anywhere in the world,” says Honda Director (marketing) Tatsuya Natsume. So, it will likely compete with bestsellers like the Maruti Suzuki Swift and Hyundai i20. Fuel efficiency will be high, like with the City.
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