Honda Cars India further streamlines ops; announces another VRS scheme for employees

Honda Cars India Ltd (HCIL) has been streamlining its operations in the country since January 2020, which is when it announced its first VRS (voluntary retirement scheme) exercise in the run up to ceasing production at the Greater Noida plant. The Japanese carmaker recently carried out its third VRS exercise in September 2021, which saw nearly 100 executives above the assistant manager level opting for it.

• Honda Cars India carried out its third VRS exercise in two years
• Nearly 100 executives above assistant manager level have opted for it
• Company says it's reconstituting operations to come to a profitable level

Honda India carries out its third VRS exercise

According to our sister publication, Autocar Professional, the VRS largely focused on senior management personnel across key operations such as purchasing, quality development, manufacturing and marketing. While confirming the September VRS, a spokesperson told Autocar Professional that HCIL is in the process of reconstituting operations to a profitable level. Following the first VRS exercise in January 2020, the second round came in July last year as the company was prepping to shut operations at the Greater Noida plant.

Sources say nearly 1,500 employees, including over 950 manufacturing associates, exited the company with hefty compensations. It is estimated that close to 500 employees have left the company over the last year since the closure of operations at Greater Noida was announced.

HCIL now only operates out of its Tapukara facility in Rajasthan, which is home to the City, Amaze, Jazz and the WR-V.

Key executives on the move

News of the VRS also comes at a time when the company has seen a high-profile exit in Rajesh Goel, senior VP and director, marketing and sales, who stepped down after a 25-year tenure. He had been with HCIL since the time of its inception and indicated that he was quitting for personal reasons.

Apart from Goel, other prominent exits include Navneet Kaur, head of brand and marketing communications, who joined Citroen India in October as the head of marketing and PR. Vineet Mishra, assistant general manager, purchasing operations, moved over to Suzuki Motorcycle India in the AVP role. Both Kaur and Mishra worked in HCIL for nearly two decades.

The industry grapevine is abuzz that more and more employees are looking for new opportunities with brands like Ola Electric, Citroen India and MG Motor India, who are believed to be among the top recruiters. It is likely that the exits of top names may have rattled the remaining workforce but that should not necessarily mean that HCIL is contemplating something drastic on the lines of Ford or General Motors.

Upcoming Honda launches in India

The brand maintains that there is a definite product pipeline for the future, including a new SUV based on the City platform that will hit the market by 2023. Honda is also gearing up for the launch of the City Hybrid in India by early 2022.

What are your thoughts on Honda streamlining operations in India? Let us know in the comments below.

Also See:

Next-gen Honda Civic sedan revealed

Honda to phase out combustion engines globally by 2040

Honda Cars

Honda Amaze

₹ 7.94 - 13.31 lakh

Honda City

₹ 14.10 - 23.89 lakh

Honda Elevate

₹ 13.92 - 19.13 lakh

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