Honda Cars India is in talks with Horse Powertrain to outsource a 1.2-litre engine with petrol, hybrid and CNG options for an upcoming compact SUV, Autocar Professional, our sister publication, has learnt.

Horse Powertrain is a joint venture between Renault Group and Geely, with Saudi Aramco as a shareholder, and it specialises in combustion and hybrid powertrains. It already has a foothold in India: the new Renault Duster, due to launch on October 17, will use a Horse 1.8-litre hybrid. The company is keen to grow its customer base among Indian carmakers and is understood to be planning a local engine plant. Fully localised engines would give buyers like Honda a significant cost advantage.

For Honda, the move would be a major departure. Engines have long been the heart of its cars, and its reputation for performance, efficiency and reliability is built on them. Handing over this core component would once have been unthinkable.

However, Honda faces pressure on two fronts with its current 1.2- and 1.5-litre petrol line-up. It must meet tightening emission and fuel-efficiency norms, and it must offer the multiple fuel options Indian buyers increasingly want, especially CNG.

Developing all of that in-house for a price-sensitive segment is costly, and sourcing a ready multi-fuel engine family would solve both problems at once.

The upcoming compact SUV is understood to be under evaluation with an existing Honda platform used in Indonesia. A price range of Rs 9 lakh to Rs 12 lakh and an October 2028 start of production have been discussed as project targets. Honda has not confirmed the vehicle or its specifications.

A new way of working

The engine discussions are part of a radical change in Honda’s strategy to develop cars for India, with specialist partners taking on a larger share of the work from the outset.

Tata Technologies is being engaged for vehicle design and engineering execution, while TCS is expected to work on the infotainment system. Honda wants design, testing and supplier development to proceed in parallel, helping it bring new vehicles to market faster.

The company is targeting a reduction in the development cycle for a full model change from around 49 months to about 30 months. This is a target for its proposed development process, not a confirmed timeline for the compact SUV.

Honda’s new approach starts with the specifications and price required for India, rather than adapting a global product late in its development. The company would retain responsibility for overall vehicle performance targets and final validation, while engineering partners take a greater role in design, verification and supplier management.

Asked about the reported arrangements, Honda Cars India declined to confirm specific partners or programmes. “We work with a wide ecosystem of technology, engineering and supplier partners. However, we do not comment on specific partners, sourcing discussions or future powertrain programmes,” a company spokesperson told Autocar Professional.

“Honda is continuously strengthening its product development capabilities in India, with the objective of developing products that are increasingly relevant to Indian customers while also leveraging India’s growing engineering capabilities,” the spokesperson added.

Cost competitiveness is central to the plan. Honda intends to make greater use of Indian engineering and suppliers while retaining its vehicle performance and durability targets. It also sees an opportunity to attract customers moving from two-wheelers to their first car. Many of them currently choose rival car brands despite owning a Honda two-wheeler.

PF2 platform plan dropped

Separately, Autocar Professional understands that Honda has dropped the PF2 platform project, which had been expected to form the basis of the next-generation City sedan and Elevate SUV. The decision raises questions about which platform Honda will use for the successors to two of its key India models.

Honda Cars India declined to confirm the change. “We do not comment on speculation regarding specific future platforms or product-development programmes,” the spokesperson said.

The company stressed that the decision should not be read as a plan to discontinue either model. “City and Elevate are important models for Honda in India, and both will continue to play an important role in our business,” the spokesperson said. Details of their future generations, platforms and technologies will be announced at the appropriate time, the spokesperson added.

Honda declined to identify the architecture for future India-bound EVs. It said India would play an increasingly important role as a manufacturing and development base, with future products drawing on Honda’s global electrified technologies and local engineering capabilities.

With inputs from Ketan Thakkar.