Why Honda has halted production of City in India

Honda Cars India is temporarily suspending production of its flagship sedan City this month as it shifts manufacturing of the car to its Tapukara facility.

The company said it will resume production of the car that is being rolled out from its Greater Noida plant in the first week of next month.

"There will be no production of the Honda City in the month of August and the manufacturing of the car will resume in first week of September," Honda Cars India Ltd said in a statement.

The company has decided to shift the entire production of the all-new Honda City to its Tapukara plant (Rajasthan) in order to meet the rising demand of its models, it added.

"With the commencement of production of the newly launched mid-size MPV Honda Mobilio at the Greater Noida plant, it was decided to shift the production of Honda City to the Tapukara to be able to cater to the strong demand for all the models," the company said.

HCIL had launched Mobilio in the country last month.

The company's Tapukara plant has an installed capacity of 120,000

units per annum and is currently running on single shift. It has been producing Honda Amaze since February, 2014 when the assembly operations began in the plant.

The Greater Noida plant also has an annual capacity to roll out 120,000 units.

"The shift of City production to Tapukara will ensure better availability and timely deliveries of Honda City and the newly launched Mobilio," HCIL Senior Vice President, Marketing and Sales, Jnaneswar Sen said.

The company has received an overwhelming response to both the City and the Mobilio, and it is necessary to maximise production at both the plants for the benefit of the customer, he added.

The fourth generation Honda City, which was launched in January this year, has been extremely successful in the Indian market since its launch in January this year.

The cumulative sales of Honda City for January-July period stood at 53,605 units the company said, adding the model has established itself as the segment leader with more than 50 per cent market share in its segment.