Honda to Outsource Horse Powertrain Engines for Upcoming Compact SUV

Honda Cars India is preparing to launch an all-new sub-4 meter compact SUV by 2028, with plans to outsource its powertrain to Horse Powertrain. The upcoming vehicle is expected to feature a 1.2-litre engine available in petrol, hybrid, and CNG configurations, marking a shift in Honda's strategy to leverage external engineering for new segments.

For comparison, according to AutoPunditz and GaadiWaadi data regarding the broader sub-4m SUV market, total sales in FY2026 reached over 12.9 lakh units with a 6.3 percent year-over-year growth rate.

Strategic Outsourcing and Engine Development

To manage development costs and accelerate time-to-market, Honda is reportedly in discussions with Horse Powertrain, a joint venture between the Renault Group, Geely, and Saudi Aramco. Horse Powertrain, which is also supplying a 1.8-litre hybrid engine for the upcoming Renault Duster, is currently planning to establish a local engine manufacturing facility in India. By sourcing a ready multi-fuel engine family, Honda aims to bypass the massive capital investment required for in-house development of new engine technologies.

Design and Engineering Partnerships

Beyond the powertrain, Honda is collaborating with external partners to streamline the vehicle's development cycle, targeting a reduction from 49 months to approximately 30 months. Tata Technologies is reportedly contributing to the design and engineering execution, while Tata Consultancy Services (TCS) is expected to handle the development of the infotainment system. The SUV will be built on an existing Honda platform currently utilized in Indonesia for the new-generation WR-V.

Market Positioning and Competition

Positioned in the highly competitive sub-4 meter segment, the new SUV will compete against established models such as the Hyundai Venue, Tata Nexon, and Maruti Brezza, as well as upcoming entrants like the next-generation Kia Sonet and the Renault Bridger. Despite the cost-saving measures implemented through outsourcing, reports suggest Honda is targeting a price range of Rs 9 lakh to Rs 12 lakh. The company has set an October 2028 timeline for the start of production, aiming for a launch during the festive season.