Honda is planning to enter India's highly competitive compact car segment by 2009 with the launch of Jazz (Fit), its first hatchback in the country.

"We started with premium cars and gradually expanded the portfolio. With the entry into the compact cars, we will further strengthen our position," Honda Motor Co CEO and President Takeo Fukui told India's Economic Times on the sidelines of the Tokyo Motor Show.

A late entrant in the compact car segment in India, he, however, justified the delay saying the company needed to build up step by step which required massive investments.

Fukui said Honda could use India as an export hub for some select models if "it complemented with other global manufacturing places such as Thailand", however, the priority of each operation would be to focus on their respective domestic markets.

He said in order for the Indian operation to become an export hub, there has to be production quality and cost competitiveness.

Honda Siel Car India (HSCI), the company's joint venture with the Sriram group, is currently expanding capacity at its Greater Noida facility to 100,000 units per year, besides setting up a greenfield facility at Rajasthan which will have a starting capacity of 60,000 units a year.

"Once the facility is ready, we will roll out the Jazz, with a 1.2 litre engine from the plant. This will enable us to enjoy the excise benefit on small car," HSCI President and CEO M Takedagawa said.