Honda Cars India completes third VRS exercise in two years

Posted on 07 Dec. 2021 12:40:00

Even as Honda rebuilds operations, the company says it has made a commitment to India and has a defined product pipeline for the future.

Honda Cars India Ltd (HCIL) has been streamlining its operations in the country since January 2020, when it announced its first exercise of VRS (Voluntary Retirement Scheme) in the run-up to production shutdown at the Greater Noida plant. The Japanese automaker recently completed its third VRS exercise in September 2021, which saw nearly 100 senior executives at the deputy director level opt for it.

  • Honda Cars India completed its third VRS exercise in two years
  • Almost 100 senior executives at the assistant manager level have chosen it
  • Company says it is rebuilding operations to reach profitable level

Honda India completes third VRS exercise

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

Sources say nearly 1,500 employees, including more than 950 manufacturing associates, left the company with heavy compensation. It is estimated that nearly 500 employees have left the company in the past year since the announcement of the closure of Greater Noida operations.

HCIL now operates only from its Tapukara plant in Rajasthan, which houses the City, Astonish, Jazz and the WR-V.

Key executives on the move

The news of VRS also comes at a time when the company saw a high-profile exit from Rajesh Goel, senior vice president and director, marketing and sales, who stepped down after a 25-year tenure. He had worked for HCIL since its creation and indicated that he was resigning for personal reasons.

Besides Goel, other major exits include Navneet Kaur, head of brand communications and marketing, who has joined Citroën India in October as head of marketing and public relations. Vineet Mishra, Deputy Managing Director, Purchasing Operations, moved to Suzuki Motorcycle India in the role of AVP. Kaur and Mishra both worked at HCIL for almost two decades.

The industry is booming as more and more employees are looking for new opportunities with brands like Ola Electric, Citroën India and MG Motor India, who would be among the best recruiters. It’s likely that the big-name departures have shaken up the remaining roster, but that shouldn’t necessarily mean that HCIL is considering something drastic in the direction of Ford Where General Motors.

Honda’s upcoming launches in India

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

What do you think of Honda’s rationalization operations in India? Let us know in the comments below.

Also see:

Next-generation Honda Civic sedan unveiled

Honda to phase out combustion engines globally by 2040

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