Repositioning of Honda City - Marketing Management Short Case Studies

Details

Case Code : CLMM013
Publication date : 2005
Subject : Marketing Management
Industry : Automobile
Length : 03 Pages
Price : Rs. 100

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Key words:

Honda City, Honda Siel Cars India Ltd (HSCI), Luxury Car Segment, Mid-sized Car Segment, Honda Civic Platform, Hyundai Accent, Ford Ikon, Tata Indigo, H.Yamada, Customer Preferences, Fuel Efficiency, Fit Aria, Thailand, Free Trade Agreements, Brand Recall, Semi-luxury Segment

Note

1: This caselet is intended for use only in class discussions.
2: More comprehensive case studies are priced at Rs.200 to Rs.700 (US $5 to US $16) per copy.

Abstract:

The caselet provides an overview of Indian car market in 1998 and the rapid changes that took place in Indian car market by 2003 that weakened the positioning of Honda City, the mid-size car launched by Honda Siel Cars India Ltd (HSCI). The caselet describes the efforts made by HSCI to reposition the car model at the lower end of mid-size car segment by offering a low powered fuel efficient model at a lesser price. Finally, it highlights the changes that are taking place at a global level that prompted HSCI to undertake such repositioning exercise.

Issues:

   » Positioning strategies of Indian automobile companies
   » Need for repositioning of a product/service
   » Product management strategies of Indian automobile companies

Introduction

Honda City with 60,000 units sold since its launch five years ago, is a successful mid-size car model for Honda Siel Cars India Ltd (HSCI). However, the company surprised industry watchers by rolling out an all-new Honda City with a complete makeover and a heavy price cut.

This was done when it had recorded a healthy 10,338 units of sales for the period January-October 2003. The new Honda City is made available in three models- Exi priced at Rs 667,000, Gxi priced at 707,000 and CVT priced at Rs 767,000.

The company's move was prompted by various factors. In 1998, the company launched Honda City in India. The car was based on its globally successful Honda Civic platform...

Questions for Discussion:

1. Examine the reasons behind Honda's move to re-launch its highly successful Honda City model with a complete makeover and a price cut of as much as Rs 100,000?

2. Do you think the company's move to reposition the car on the fuel efficiency and price platform will work?