Honda launched the all new City in early 2014, and it is an instant blockbuster hit. The demand for the car is gigantic, the company recently stalled the production of the car to cater to the customer order and accommodate the new Mobilio MPV. Honda in 2014 August announced of its plan to shift the production unit of City to its Tapukara factory in Rajasthan. The manufacturing process has started, and the company has started rolling out the first batch of vehicles. The company manufactures its blockbuster hit Amaze in the same factory.
New Honda City
The whole of India is crazy about the new City, it just flies out of the window, and every month Honda sells 7,000 units of the car. The new City is on everyone’s wish list, but there was a point of time when the company stopped manufacturing the car. It has to now regain its lost momentum, the production resources are organized, and the company is targeting 5,000 units a month. The company now has to move back to the original point and manufacture a range of City cars. Through the tedious initialization process, consumers will have to adhere to four month waiting period.
Honda has a robust assembly line, and the operations can hence move at a swift pace. The company has constructed the line to assemble thousand vehicles in a single shift. As mentioned earlier the demand for City is sky high, the car may not have been on the scene for a while, going by the demand, Honda is contemplating the construction of a second shift if the desire for City and Amaze continues to remain on mountain top.
The festive season is fast approaching, and this time, it is not so happy news for ardent City buffs. For those keen on petrol model, will have to linger for a while, the price variation between diesel and petrol cars have narrowed. The variation has decreased to a significant level from a couple of years ago; it is now Rs 10 per liter against Rs 32.
With the narrowing of price range between diesel and petrol cars, the waiting period will stretch from few weeks to four months. From demanding hatchbacks such as Maruti Celerio and Grand i10 to enviable Tata Zest and Honda Amaze sedans and Mobilio MPV, the waiting period for petrol variants ranges from 3-16 weeks.
It is a sudden surge in waiting period, but it is not too alarming, the government last January spoke of its plan to reduce the grant on diesel cars. The cost of diesel vehicles has risen considerably since the proposal of the scheme. Earlier the demand for diesel cars was on a higher scale, the waiting list for enormous to an extent that companies were unable to meet demand. Now the prices of diesel cars have increased, because of the government’s policy to reduce subsidy and it is now a challenge to adjust to the new system.
In 2010 June when the Government proposed a scheme to decontrol petrol costs, the price of vehicles shot up by over 33% between 2010 July and 2012. Diesel prices are not de-controlled, and yet it has risen to 3%.
It is just the circumstances contributed by increased demand for City and government intervention that has led to rise in price of diesel cars.
