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Updated: April 3, 2013 03:10 IST

Honda draws up Rs. 2,500-crore plan to set up unit in Rajasthan

Staff Reporter
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Managing Director, Honda Motor Company, Yoshiyuki Matsumoto, with President and CEO, Honda Cars India, Hironori Kanayama unveiling the Honda 1.5 DTEC diesel engine in New Delhi on Tuesday. Photo: Kamal Narang
Managing Director, Honda Motor Company, Yoshiyuki Matsumoto, with President and CEO, Honda Cars India, Hironori Kanayama unveiling the Honda 1.5 DTEC diesel engine in New Delhi on Tuesday. Photo: Kamal Narang

Eyes higher contributions from emerging markets

Honda Cars India Ltd., on Tuesday, said it planned to invest Rs.2,500 crore in India by next year to set up a car assembly line, a diesel engine component unit and a forging plant at its Tapukara facility in Rajasthan.

The company will also launch five vehicles over the next three year as the Japanese auto giant eyes higher contributions from emerging markets, including India.

Honda Cars has also mandated its Managing Officer Yoshiyuki Matsumoto the additional responsibility of ‘Representative of Development, Purchasing and Production in Asia and Oceania Region’. He will be based in India, and will also be the President and CEO of Honda Motor India.

“To expand our business in the country, we are starting our preparations to create new capacity and are investing a total of Rs.2,500 crore towards setting up of a new assembly line for cars, a new diesel engine component production line and a forging plant at Tapukara in Rajasthan,” Matsumoto told reporters here.

The 437-acre plant would have an installed capacity of 1.2 lakh cars annually and would be ready to roll out its first car next year, he added.

With the setting up of the new car assembly line at Tapukara, HCIL’s total installed capacity will go up to 2.4 lakh units annually. The new assembly line and the forging plant will generate employment for 2,200 people by 2014. The Rajasthan plant has 1,400 employees right now.

“We aim to increase our global volumes to six million (60 lakh) units by FY16-17 and expect 50 per cent of it to come from emerging markets. India is a key market for us. It is essential to ramp up capabilities here,” Mr. Matsumoto said.

The company at present sells around 35 lakh units annually.

The five models to be introduced over the next three years include its diesel car Amaze, which will be launched next week. The upcoming sedan will be fitted with a new 1.5 litre diesel engine that the company showcased on Tuesday.

The company claims that the diesel option of the car will give a mileage of 25.8 km a litre.

HCIL had earned exports revenue of Rs.242 crore from the Tapukara plant that currently rolls out engine and transmission components such as cylinder heads and cylinder blocks.

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