Honda’s Re-Entry in the Midsize SUV Market: Will this Change the Game Altogether?

    Japanese automobile giant has changed its SUV strategy. Dropping its plan to launch an all-new compact SUV based on the Amaze platform, and deciding on a larger, 4.3m-long, midsize SUV based on the City platform in its place.

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    The new Honda Elevate

    Japanese automobile giant, Honda has changed its SUV strategy. The auto giant has dropped its plan to launch an all-new compact SUV based on the Amaze platform, and has decided to bring in a larger, 4.3m-long, midsize SUV based on the City platform in its place. Honda originally had plans to bring the HR-V (code: 2XV) in 2019 and even the trial production for it had started at the HCIL Greater Noida plant, but then came this 360-degree turn.

    This sudden change was triggered followed by the launch of Kia Seltos and MG Hector at steal prices. Honda knew that with just 30 percent localization, there was no way the HR-V could have stood a chance against its aggressive new rivals to make a decent profit. This realization hit Honda hard and forced it to pull the plug on the HR-V production and direct its focus on the City-platform based SUV with a new 2022 launch timeline.

    Trigger Factors

    Honda’s Greater Noida Plant

    Initially, Honda had announced its plans to launch both a compact SUV and a midsized SUV in 2018. Pandemic has drastically changed the world since then, subjecting the global automotive industry to its worst hit ever. Frantically trying to get back to their original pace, all the major automobile giants were forced to make life-changing decisions to deploy their resources and finances towards a project that would yield maximum sales and profitable output.

    Following this, Honda had decided that it would launch an Amaze-based platform compact SUV, which would require lower initial capital. So, why the sudden change of heart? Well, it turned out that in a span of 2 years, the compact SUV segment had become over-populated, with 10 plus models competing against each other, affecting the other’s sales drastically. In such a rat race, Honda’s compact SUV would have been the 12th model of the segment falling just behind the Tata HBX compact SUV in line. With such severe competition, the Japanese carmaker would have its work cut out for good.

    This brought the midsize SUV back on the charts. With only four potential opponents, the midsize SUV game was far less crowded and more likely to yield decent profits. With this motivation, Honda got back to designing its fantasy car that would gain a high level of customer satisfaction with lower-cost input.

    Speculations

    This brand-new SUV (code: 31XA) is internally known as the S-SUV and is speculated to be similar to the production version of the Honda N7X concept SUV revealed recently in Indonesia. For Indian Production, the SUV could be called the Honda Elevate. It’s speculated to include 2 seating layouts –

    • A 5-seater layout to lock horns with the likes of the Creta, Seltos, Hector, Harrier, and Kick
    • A 3-row trim to rival against the Alcazar, Safari, and the Hector Plus.

    Reliable Sources spilled that Honda has very recently registered the “Elevate” trademark in its name, which could be the three-row version of the midsize SUV. While nothing has been declared officially, it’s expected to mirror the design language of the Indonesian three-row Honda SUV.

    Spoilers

    Even with Honda being tight-lipped regarding the launch of its new toy, we have found some totally sizzling auto gossips. Honda has its fingers crossed concerning the sales of its new S-SUVs. It hopes to sell 40,000 S-SUVs in a year and so it has set tough cost targets to rival Seltos and Creta. To cap the cost, a localization of about 90% is expected. Also, the S-SUV is rumored to derive key components from the City, like the pair of 1.5 petrol and 1.5 diesel, CVT gearbox, and some suspension bits to lower the design costs. The S-SUV will stick to the BR-V’s electrical and electronic (E/E) specs for further deductions. The downside to this is that this might cap the electronic features the car could have.

    Change of plans has taken a toll on Honda’s overall standing in the auto world. The move from compact SUV to a midsize one has set the company back by almost a year. The original timeline of 2022 is shifted by an entire year to September 2023 when the S-SUV could hit the showrooms. This has lagged Honda significantly behind its contemporaries who have stolen the march with their lucrative and fierce new models. Hopefully, the supposed Honda ‘Elevate’ will haul the auto giant back to the podium.

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