The Indian car unit of Honda Motor Corp has not yet decided on starting assembly operations at its second manufacturing unit in Rajasthan, a senior official said.
The company’s first plant near New Delhi, which has a capacity of 100,000 units, was running at only 60 per cent capacity, marketing head of Honda Siel Cars India, Jnaneswar Sen, told reporters on the sidelines of an automobile conference.
Data from industry body Society of Indian Automobile Manufacturers Association showed that in the first four months of this fiscal year starting April, the company’s production fell nearly 15 per cent from a year earlier.
In February, Sen told Reuters the company would revive plans to start production at its second plant once full capacity was reached in its first plant. The second plant would have an annual capacity of 60,000 units with an investment of 10 billion rupees. Honda Siel makes and sells cars such as the Jazz hatchback and Honda City sedan.
In July, the company announced an investment of $53.5 million to expand its powertrain facility at the Rajasthan plant, to be used for its small car. Its compact car will be launched in the second half of 2011 and will be initially rolled out of its facility near the capital.
Honda Siel, which saw sales dip 5 per cent in the April-July period, is expecting double-digit sales growth this month, Sen said. India is seeing a near-35 per cent growth in car sales with more than half a million cars already sold in the first four months of 2010-11.