Honda’s conquering profits from crossroads

Honda Cars India has managed a strong brand image since inception in 1995 December. From the start till now the perception of owning a Honda car is possessing life-time fortunes. What makes HCIL an integral component of the auto segment, the firm has gone through rough and delightful moments, what makes it a victorious entity.

Being an automobile sector means getting acquainted to the cut-throat competition. Through the years, HCIL has established itself, even amidst the current troubled economy, the company has emerged triumphant, when other firms were and are still struggling to make desired profits. In July 2014, Honda climbed the corporate ladder and is now the third biggest auto unit with an impressive 40% gain. During the period the company sold 15,709 units and has overtaken eminent Indian based auto manufacturer Mahindra and Mahindra. Mahindra reported a 5% decline in 2014 July with the outflow of 14,708 units. Honda’s market share doubled from 3-7% noted from FY13 to FY15.

Honda’s smart strategy and efficient operations, has resulted in spectacular market share gain. It is now on par with the highest rated auto firm Maruti Suzuki and the second best automobile company Hyundai. Maruti Suzuki during the FY13 to FY15 period had vast control of 44% market gains and Hyundai 17%. If Honda’s profit portfolio is on the pattern of Maruti Suzuki and Hyundai, the extent of business profit drive is remarkable.

Sources have termed Honda’s marvelous profit outcome under grave economy crisis‘resurgence’. To tide over the rough period, the company emphasized on a couple of strategies, innovation and quality. The company had its share of difficulties, the worst was post FY2010-11, and it was a crushing period for Honda. According to date provided by Society of Indian Automobile Manufacturers, the market share was 2.36%. The main profit hindering factors were natural mishaps; Japan was hit by massive tsunami and earthquake in 2011. Surrounded by disasters and recovery difficulty, there were difficulties transporting equipments from Japan. Honda could not sell bulk volumes of Accord and Civic, and both models lost its sheen to Skoda Superb and Toyota Corolla. The sale of Jazz too took a setback, and was a threat to Nissan Micra and Volkswagen Polo. Toyota Fortuner took the center stage and diminished the popularity of CR-V.

There was a demand for Honda cars in the past, but it attracted a limited crowd, CR-V, Jazz and City are glamorous and powerful, it was the price structure that withdrew customers. When the Indian automobile industry faced its worst profit downslide for two continuous years, the steepest in ten years, Honda dwelled into the cost-effective approach. In 2013 April, it launched Amaze compact sedan, the car is eye-catchy at first site, and is equipped with comfort, safety and engine power. It was the best-in-segment 25.8kmpl mileage power and new i-DTEC diesel engine technology that drew customer attention months before launch. It was an instant best-seller; Honda then used the same i-DTEC engine technique into the all-new City and garnished it with novel Exciting H Design technology. It too is a blockbuster product, the recently launched Mobilio also runs on i-DTEC engine and its fuel-efficiency value is an admirable 24.4kmpl.

According to the latest car reports Honda is working on a refreshed Accord and Civic along with new Jazz. Honda has emerged jubilant from nowhere.