Honda is trying to find ways to catch up with its rivals in India’s growing SUV segment. In a wide-ranging interview, Kunal Behl, the vice president of marketing and sales at Honda Cars India, told DH’s Prathik Desai about its upcoming product launches and understanding of the Indian consumer after selling its iconic sedan, Honda City, for 25 years in the world’s fourth-largest automobile market. Edited excerpts:
What do you know about Indian buyers after selling an iconic sedan here for so long?
Honda City is one of the most successful sedans in the Indian auto industry and it is quite an aspirational brand. Everybody wants to be a part of the City once in a lifetime. After completing 25 years, there definitely has been a lot of learning. For example, now the buyer has become younger. So, we are trying to tap young buyers.
Also, a lot of female buyers. Another thing which has changed is that people who prefer automatics have gone up. Now, we are close to 50 per cent of CVT (automatic transmission) buyers out of the total sales. This used to be about 35-40 per cent a couple of years back.
How do you plan to gain share in the SUV segment?
SUV is a very strong growing segment in the Indian auto industry. The contribution has gone close to 50 per cent now. Definitely, Honda needs to have a good share of the SUV segment. We are late in the entry to the segment, but we are now going to come up very strongly. We have already made a global India-focused SUV, specifically suited for the Indian conditions. We should be launching this before the festival period of next year.
Honda’s retail market share has dropped to 3 per cent in September 2022 from 5.1 per cent in July 2020. What went wrong?
The direction of the brand is to go premium in the market. It is about the product we offer to the customers and the services we offer to our network. That is one of our key strategies. Every model has a lifecycle to it. I think it is all as per plan. I wouldn’t say that it is something that has taken us by surprise. But, we have key volume pillars like the Honda Amaze and Honda City. And, as I said, we are trying to focus all energies towards developing the SUV as the third volume pillar for Honda. The market share could be for a specific period and the SUV segment has expanded a lot, the overall dynamics of the Indian auto industry have also changed. We are trying to transform our total lineup.
Will we see more affordable SUVs from you? Or will you stick with premium models?
You will have to wait for a little more time to see that. We have studied the market as to where the SUV segment is growing and where exactly we need to come in and fill in the shoes. We are trying to capture the space where our customers want us to be. But the ‘premiumness’ remains the key principle in whichever segment we choose to enter.
What is your game plan for electrification?
As a global direction, we have two broad benchmarks. The first benchmark is, by 2030, we shall have two-thirds of our total global sales as electrified sales. And, of course, Honda Cars India is a part of the global arm. And, by 2040, 100 per cent of our sales will be through Battery Electric Vehicles (BEV). Yes, the EV segment is quite growing. But in India, our first step towards electrification is through the Honda City e:HEV (Hybrid).
How will the upcoming safety regulations affect Honda’s costs and pricing?
Firstly, we really respect what the government is bringing in terms of safety for Indian consumers. At the same time, it takes a lot of time to adapt to those regulations. It does have cost implications to bring the regulations to our total lineup. But we are quite prepared and are ready to follow the regulations.