``This year we are targeting a volume sales of 12,000 cars in the domesticmarket and exports of 100 cars to neighbouring Asian markets,'' says AnandaMohan Gupta, general manager, marketing, Honda. ``Last fiscal despite atough environment, we managed to sell 9,698 cars -- close to our revisedtarget of 10,000 cars (Honda had scaled down the sales target to 10,000 carsfrom 14,000 cars in 1999-00).''

Expanding dealerships
Beginning with the setting up of Hero Honda dealerships shortly in Lucknowand Amritsar in the north, Honda will add another three outlets in threecities (including Surat and Goa in west, and Bhuvaneshwar in east) to itsexisting network of 20 outlets in 17 cities.

Driven by the Honda philosophy of 3S -- sales, service, spareparts under oneroof -- these dealerships entail an investment of Rs 1 crore, excluding landand building, on equipment. Depending on the potential of a geographicalmarket, Honda sets need-specific working capital requirements. A Mumbaidealership selling 17 cars a month, for instance, will need to stock 30 carsat any given time (or roughly Rs 2 crore in working capital). Whereas, Delhidealerships, being two hours away from the Honda plant, can order stocks asand when the demand arises.

``Quality of customer care and servicing will be our thrust area,'' saysGupta. According to a Honda study, over 80 per cent of Honda owners keepcoming back to the same dealerships. Through simulated dealershipexperiences at its Honda training schools, Honda trained 150 sales personneland 600 technicians last year.

``We'll have a new set of training modules next fiscal (2001-02) when wemight possibly launch some new products,'' says Gupta.

Having already invested Rs 450 crore in the plant in the last two years,Honda Siel Cars India -- Honda holds a 95 per cent stake in the JV -- doesn'tcontemplate to launch new products this fiscal. At present, Honda has twodifferent engines with two additional variants priced at Rs 613,775(1.3Lxi), Rs 685,812 (1.3Exi), Rs 767,989 (1.5 Exi) and Rs 827, Rs 845 (1.5Mi)- excluding showrooms in Delhi.

Focus on south
Even as it consolidates its position in Delhi (three Honda dealerships) with30 per cent of the mid-sized car market, 17 per cent in Mumbai (twodealerships), and 20 per cent in Bangalore and Hyderabad, Honda is preparingto crack the south markets of Chennai, Cochin and Coimbatore where itsmarketshare is hovering around 12 per cent. ``The southern market ispredominantly skewed towards the diesel car market,'' says Gupta. ``Besidesbetting on institutions which campaign against polluting diesel vehicles, weare putting in place a new communication strategy to attract consumers toHonda.

Adspend
Buoyed by the fantastic reception of its `Gem of an engine, jewel of a car'positioning for the New Honda car, Honda has earmarked an advertising andpromotional budget of Rs 16 crore. The New Honda TVC and print campaignbolstered Honda's sagging sales from around 700 units a month betweenSeptember and November '99 to over 1,000 cars at present.

Continuing its relationship with creative agency Everest, Honda's new TVCwill hit in June 2000, followed by a print burst in August and September.The campaign will carry forward the brand message -- Gem of an engine, jewel ofa car -- and focus not as much on functionality as on Honda's sophistication.The print media-plan will include mainstream dailies and business magazines.As for TVCs, it will run spots in news and high TRP channels.

``Last year the market was in turmoil with lots of new entrants, so wedecided to adopt a subtle line,'' says Gupta. ``While the print revolvedaround the theme of power, fuel and environment, the TVC talked about theHonda class.''

Tie-up with Trident
Honda has also tied up with the Trident chain of hotels to maximiseco-branding opportunities for holiday jaunts and events. The tie-up willenable Honda to organise test-drive events at various Trident properties,where prospects can be invited. Simultaneously, Honda dealers will alsoundertake one event a week at local clubs, where club members will be thefocus of Honda's personalised marketing.

The interactive site
In a month, Honda is also expected to upgrade its site HondaCityIndia.com.Aimed at providing 360 degree panoramic view of the brand, the enhanced sitewill let surfers visit virtual Honda dealerships as all Honda dealershipsare being incorporated in the site. The site will also let surfers keep intouch with the Formula One happenings -- Honda enetered the circuit after sevenyears.

Consolidating organised financing
With consumer finance accounting for around 65 per cent of sales, Honda isnow planning to consolidate organised financing -- at present it has tie-upswith ICICI and Stanchart. ``Halfway through the year, we may go for regionaltie-ups with players having strengths in local markets,'' says Gupta. Thetie up with Standard Chartered and ICICI gives Honda an internal rate whichis less than one per cent of the market rate (15 per cent now).