Honda unveils date for HR-V’s launch

LAHORE: Honda Atlas Cars Pakistan (HACPL) has finally unveiled the release date of their upcoming HR-V across their social media accounts. The company has touted October 21, 2022 as the launch date for the vehicle. “Yes, In sha’Allah” said Amir Nazir, General Manager Sales and  Marketing at HACPL, when asked by Profit if the HR-V would be released on the touted date. 

The HR-V is set to be released in a total of three iterations. It will have two completely-knocked-down (CKD) editions and a completely-built-up (CBU) unit. The two CKD editions will be known as the VTi and VTi S, both of which will come with conventional combustion engines. The CBU edition will be the hybrid variant of the vehicle, and is expected to be made available for purchase at a later date than its aforementioned combustion engine siblings. 

HACPLs two pronged approach is likely a result of their inability to manufacture hybrid engines en-masse to cater to demand at a time when the industry’s supply chains are constrained by the State Bank of Pakistan’s (SBP) administrative oversight on CKD kits, and the volatile nature of the PKR. Furthermore, the decision to directly import a CBU edition of the vehicle rather than commit to creating a CKD variant is likely because of the higher cost of manufacturing a hybrid variant relative to a traditional combustion engine vehicle. 

HACPL would have benefited from the reduced import duties on the import of parts for hybrid vehicles outlined in the Auto Industry Development and Export Policy (AIDEP) 2021-26. However, the cost savings are debatable given that hybrids are generally more expensive in terms of their upfront costs. Committing large sums of investment towards a more expensive variant might have been a decision bound to work against HACPL given the contractions in sales figures across the industry. Importing the CBU variant enables HACPL to work on localization piecemeal and develop their supply chain network to eventually localize the new hybrid engines. As a non plug-in hybrid vehicle, the duties that the HR-V would be subject to are as follows: 

The direct competitor to the HR-V will likely be the assortment of crossover sports utility vehicles (CUV) present across the Pakistani automotive space with almost every brand now having their own offering in the space. The lack of a price reveal in advance limits the direct comparisons that can be made with the HR-V. However, the most common comparisons to be made are likely to be the KIA Sportage, the Oshan X7, and possibly the Hyundai Tucson and the Haval H6. 

The Sportage is undoubtedly the leader of the pack in the CUV market with its sheer sales volume. Its recent discount across all of its iterations is likely to make it a more competitive purchase for consumers who may either not have the finances to buy the HR-V in this market or may be distrustful of HACPL’s initial foray in the market. Given that the HR-V will be in line with its international siblings in terms of vehicular generation, the X7 is likely to be its direct competitor. With the X7 having waiting queues upwards of two months and on-payments upwards of Rs1 million, this will likely be the competitor that the HR-V takes on.

The Hyundai Tucson and Haval H6 are notable mentions. The former on its availability in the market relative to all other CUVs and the latter in regards to being the same vehicular generation as the HR-V. 

The launch of the HR-V will now give HACPL an entirely new market to expand their reach in with the CUV market having grown from 5 per cent to 20 per cent over the past three years and touted to increase from 20 per cent to 37 per cent by 2030 according to Shabbir Uddin,  Director Sales and Marketing at Master Changan Motors. 

However, the more pungent question that is raised is if a hybrid vehicle can be feasibly manufactured in Pakistan to begin with. HACPL’s decision to opt for a CBU indicates that such a task is herculean even for a company of their stature. This question then directly puts into question the fate of Toyota Indus Motor Company’s Corolla Cross and the hybrid variant of Haval’s H6 that are to be launched next year and later this year respectively. The Cross, as of right now, will only be a hybrid vehicle which puts it in a far more precarious position as to what its future holds.