Calcutta, April 19: Honda Cars India Ltd continues to reap the benefit of the 1.5-litre iDTEC diesel engines in spite of the shrinking gap between petrol and diesel prices.
The company, which had posted 41 per cent growth last fiscal on the back of strong demand for the fourth-generation City, still sells more diesel cars than petrol models.
"Of the one lakh units of the new City that we sold in 15 months, 54,305 units were diesel vehicles and 46,994 units petrol vehicles," said Jnaneswar Sen, senior vice-president, marketing and sales, of Honda Cars India.
Conceding that the market is moving towards petrol, Sen said, "Honda's success in India in 2014-15 can be attributed to the 1.5-litre iDTEC engine that powers the Amaze, the City, the Mobilio and will also be found in the upcoming Jazz. It is the most fuel-efficient engine across all segments and is the new benchmark for fuel-efficiency and power."
However, the company is reluctant to use a diesel engine in the soft off-roader CR-V. The vehicle has a petrol engine.
"The CR-V is available in diesel in Europe but we are not going to have the diesel option in India. It is a matter of prioritisation. On an average, we are selling 80 to 100 units of the CR-V per month. Of course, the numbers will increase if we plonk a diesel engine, but the incremental numbers will still not justify the investment of a diesel engine in the off-roader," Sen said.
Following a fresh investment of Rs 380 crore in its Rajasthan plant, Honda Cars is looking to expand its capacity to 1.8 lakh units annually from 1.2 lakh units.
The company's next big launch will be the third-generation Jazz in the second quarter of this fiscal.
"It's a new model that has been launched globally. It has been named the 'Japan Car of the Year' and is very well accepted across markets where it has been launched. The USP of Jazz is the space inside, it is bigger than many sedans," Sen said.
The first-generation Jazz, launched seven years back, had failed to generate much excitement because of its pricing at Rs 7 lakh.
