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, according to media sources.

Horse Powertrain is a joint venture between Renault Group and Geely, with Saudi Aramco as a shareholder, and specialises in combustion and hybrid powertrains. The company already has a presence in India: the hybrid version of the Renault Duster, scheduled to launch on October 17th, will use a Horse 1.8-litre hybrid powertrain. The company is seeking to expand its customer base among Indian carmakers and is understood to be planning a local engine plant. Fully localised engines could provide customers such as Honda with a cost advantage.

The move would represent a change in Honda's approach to powertrain development. Engines have traditionally been developed by Honda for its vehicles, with performance, efficiency and reliability among the areas associated with its engine development. Outsourcing this component would represent a change from this approach.

Honda faces requirements related to its current 1.2- and 1.5-litre petrol engine line-up. It must meet tightening emissions and fuel-efficiency standards while offering multiple fuel options, including CNG.

Developing these technologies in-house for a price-sensitive segment involves additional costs, while sourcing a multi-fuel engine family could address these requirements.

The upcoming compact SUV is understood to be under evaluation using an existing Honda platform used in Indonesia. A price range of Rs. 900,000 to Rs. 1.2 million (US$ 9,375-12,500) 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 form part of a change in Honda's strategy for developing cars for India, with specialist partners expected to undertake a greater 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 to reduce the time required to bring new vehicles to market. 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 and is 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 later in its development. The company would retain responsibility for overall vehicle performance targets and final validation, while engineering partners would 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 media sources.

"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 further added.

Cost competitiveness is a consideration in 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 these customers currently choose rival car brands despite owning a Honda two-wheeler.

PF2 platform plan dropped

Separately, media sources understand 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 leaves the platforms for the successors to these two India models unconfirmed.

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 said the decision should not be interpreted 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.