Honda is planning to invest INR6.5 billion in its Indian plant to boost capacity. The company is enjoying healthy demand for its City compact saloon (a three box sedan version of the Jazz) and will also look at launching new models to boost its presence in India.

Under the plan, Honda will increase the output of its Surajpur plant to 100,000 units by 2010. The first phase will expand output to 50,000 units from the present 30,000 by the end of the year.

One model being looked at is the new Civic that Honda will bring to India to fill the huge gap between the City compact saloon and the Accord.

Toyota already has the Corolla in that segment competing with the Chevrolet Optra and Skoda Octavia (last generation body style) and the Civic is likely to bring Honda moderate numbers around the four digit mark every month. The car is expected to be priced around INR1.0 million.

Honda currently sells the Accord (the US version), City and CR-V in India. All three attract healthy demand and the company maintains a premium brand image here.

Deepesh Rathore / Tilak Swarup