The Indian small car market will see yet another player entering the domain with the Japanese car manufacturer Honda designing a car for domestic consumption, the automobile maker said today.

"We are designing a small car which will be launched a few years down the line," Jnaneswar Sen, vice president (marketing), Honda Siel Cars India, the Indian subsidiary of the Japanese company, said.

The car would be placed in the B, B+ segment, Sen said.     

The company would launch a premium hatchback model by 2009 summer. The model has been named 'Jazz' and would have a engine capacity of 1200 cc, he said.

Launching the new Honda City, Sen said that the company's second production base was coming up at Rajashthan and would be ready by the end of 2009.

The company would make an investment of Rs 1,000 crore (Rs 10 billion) at its Rajashthan plant. The initial capacity would be 60,000 units per annum, which would be expanded up to two lakh units per annum.

Talking about the financial turmoil, Sen said it had an adverse impact on the company.

Last year, the company sold 62,000 units across all its models.