NEW DELHI: Japanese carmaker Honda Cars (HCIL) on Wednesday confirmed stopping production at its Greater Noida facility amid slowdown expected in the Indian passenger vehicle market. HCIL will now consolidate its manufacturing operation for vehicles and components at its Tapukara plant in Rajasthan for all domestic sales and exports.
“Despite an uptick in sales in the last three months, the current market conditions remain unpredictable for the industry at large. The impact of COVID-19 has pressed us to strengthen our constitution, and to achieve the same, HCIL has decided to consolidate its manufacturing operations by making the Tapukara plant a unified manufacturing base,” said Gaku Nakanishi, President & CEO, HCIL.
The decision by Honda comes at a time when the Indian Government has been aggressively trying to attract investment in the manufacturing sector and create jobs. According to reports, Honda employed about 2,000 workers in the manufacturing department of its oldest facility in Greater Noida that had the capacity to produce one lakh cars per annum.
“HCIL continues to believe in the resilience of the Indian economy and hope for a quicker recovery of the market. India is an extremely important market in Honda’s global strategy and HCIL is committed to bring its latest and advanced technology models including electrified vehicles in future,” said Nakanishi.
This is also not the first time when a foreign automaker has decided to realign its business in the Indian market. In recent times, Ford India also decided to form partnership with Mahindra & Mahindra while Volkswagen has put forward its Skoda brand to stay relevant here. American automaker General Motors, which ceased domestic operations in 2017, is expected to shutter its factory in Maharashtra this week.