Japanese car maker Honda has stopped production at its plant in Greater Noida and will instead consolidate the manufacturing operations for vehicles and components in Tapukara, Rajasthan with immediate effect for domestic sales as well as exports.
While production will cease at Greater Noida, all head office functions, India research and development centre and spare parts operations for automobiles, two-wheelers and power product business will continue to operate from there, the maker of the popular Honda City sedan said on Wednesday.
The automobile industry has had a bumpy ride. Sales were already slow in 2019 and the COVID-19 pandemic was another blow. While sales have begun to recover in the last few months as demand for personal mobility increased, whether the demand will be sustained is still uncertain.
"Despite an uptick in sales in the last three months, the current market conditions remain unpredictable for the industry at large," said Gaku Nakanishi, president and CEO of Honda Cars India.
Honda's domestic passenger vehicle sales in November rose 55 per cent from a year ago to 9,990 units.
According to data from Society of Indian Automobile manufacturers, PV industry saw domestic sales grow 4.7 per cent from a year ago to 2,64,898 units in November. For the April-November period, PV sales were down 21.7 per cent at 14.56 lakh units.
"The impact of COVID-19 has pressed us to strengthen our constitution, and to achieve the same, Honda Cars India has decided to consolidate it's manufacturing operations by making the Tapukara plant a unified manufacturing base," said Nakanishi.
Honda said sales saw a good recovery in the festive period and it expects to sustain the momentum in coming months.
"India is extremely important market in Honda's global strategy and Honda Cars India is committed to bring its latest and advanced technology models, including electrified vehicles in future," maintained Nakanishi.
Honda Cars India was established in December 1995. Its Tapukara plant has a capacity to produce 1.80 lakh units per annum.
