Honda's Accord to target Commodore

HONDA wants a slice of the lucrative large Australian sedan market - and says its new V6 Accord is just the vehicle to get it.

Fresh from turning around an $8 million loss last financial year, Honda Australia plans to increase sales considerably in 2003, a year in which it is expected to launch not one but two different new Accord sedans, plus a hybrid version of the Civic.

Honda Australia's 2003 Accord line-up will not be officially announced for at least another month, but the company has confirmed the larger US-market Accord sedan, built in Thailand and on sale in the US since September, will be part of the range that goes on sale here around mid-year.

While Honda Australia director Lindsay Smalley hopes it is this wide-bodied model that can attract traditional high-series Commodore and Falcon buyers, he has also suggested the smaller European-market Accord, built in Japan, is likely to be sold alongside it to compete with medium sedan segment leaders Camry and Mazda6.

While Mr Smalley dismissed a scenario in which Honda would target fleet sales with its V6 Accord and private buyers with the 2.4-litre four-cylinder Euro car, he agreed a two-pronged Accord attack would be unique in the marketplace.

"Honda's been known for being unique," Mr Smalley told GoAuto at last week's launch of the new flagship MDX off-roader.

"We've made decisions on Accord, which we'll reveal in four to six weeks, and it will certainly excite the marketplace. A good, strong V6 in a car that size has got to look all right in that market.

"Most of our bases are covered, with the exception of the large-car local V6 market.

"A lot of that market is fleet business and we're not interested in fleet, but there still is an opportunity for the private buyer in that market.

"We've had our troubles, but once we fully establish our current raft of models we'll certainly look very closely at what the local V6 market is doing to see if we can address that.

"But we're not in the fleet business. What we find with fleet is that it essentially devalues the entire market and really does penalise the private buyer by the depression of used car values. There's nothing worse than spending your own money on a brand new motor car and seeing the same car being driven around town with a taxi sticker on it." Mr Smalley said the current, sixth generation Accord, which has struggled since major price increases in 2001, was being run-out "in an orderly fashion", selling between 60 and 80 units per month. At that rate, with about 115 Accords still in dealer and Honda Australia stock, supplies should last almost until the arrival of the new model.

In any case, said Mr Smalley, bullish expectations for the new Accord range - which he said should rival the popular Mazda6 for sales - would compensate for any current Accord downturn.

"We'll be launching a new Accord in the middle of this year, and it's only eight to 10 weeks until that time," he said.

The new Accord wagon, revealed at the Geneva motor show in March and due on sale in Europe by May, is believed to be off Honda Australia's agenda due to unfeasibly low sales expectations.

Limited sales will also preclude the sale of the US-market Accord coupe here.

What's coming:

New MDX off-roader: April 1
New US Accord V6 sedan: mid-year
New Euro Accord 4-cyl sedan: mid-year
Civic Hybrid sedan variant: late 2003
New CRX hatch: 2004
Legend V8 sedan redesign: 2004
NSX supercar redesign: 2005

Honda on the rebound

ALTHOUGH yet to be officially announced, Honda Australia is expecting a solid return to profit in the Japanese financial year that ended on March 31, while a flurry of new model activity this year is likely to bolster its hopes of setting near-record sales targets in 2003.

The strong financial turnaround follows an $8 million loss in the previous financial year, due to slower sales and a weak Australian dollar, according to Honda Australia director Lindsay Smalley.

"We had a terrible year, essentially driven by a bad exchange rate and loss of volume," he said.

"We can't approve a final profit/loss statement until it's approved by the mothership. But we have a very strong turnaround in performance this year, driven by three areas: very tight cost control, the recovering Aussie dollar and a 13.5 per cent lift in our volume.

"A lot of these things we can influence, like better cost control and volume increase through smarter marketing. But the largest impact on profitability is the Aussie dollar, which we have no control over." Last week's MDX launch followed the January release of the Integra Luxury and Odyssey V6 Luxury models, while the petrol-electric Civic Hybrid sedan will go on sale following the mid-year Accord range launch at the end of 2003. Priced to compete with Toyota's Prius, the eco-Civic may be sold alongside the current two-seater Insight hybrid.

Each of these new models will play an incremental role in a year in which Honda hopes to sell about 28,000 vehicles in a total Australian automotive market Honda predicts will set another record of 825,000 sales.

This compares to just 20,800 Honda sales in 2001 and 23,600 in 2002, and not far short of Honda Australia's record of 30,034 units in 2000.

Much of the sales increase will come from new model activity and the success of Jazz.

But while Mr Smalley concedes the CR-V compact 4WD has plenty of ground to make up, he is adamant the early 2003 sales pace will improve to meet initial projections, which were already lower than in 2002 due to increased competition in the compact off-road segment.

"Our ideal is still to retain the number one (SUV) position with CR-V," he said.

"Our target for CR-V this year is about 9600, which compares to about 12,500 last year, and we will still definitely meet that projection this year.

"Our CR-V marketing strategy isn't to throw heaps of money at it or to bolt every knick-knack known to man on the thing, which is the case with some of our competitors like (Mazda) Tribute.

"You can have one or two major events and pick up 500 or 600 sales. It's just the nature of that type of car," he said.

To the end of February, CR-V's sales shortfall was similar to the amount by which Jazz had bettered sales expectations, with CR-V down on projections by 150 units per month and Jazz bettering its 600-per-month prediction by about 30 per cent.

While Mr Smalley ruled out the introduction here of the luxury Acura brand, he did express some interest in diesel power, especially when it comes to the company's new MDX flagship.

"Honda has just entered the diesel market with its own diesel in the Accord in Europe, which won't come to Australia," he said.

"But I can imagine, as Honda's diesel technology capacity increases, there may be opportunities for other vehicles. I wouldn't exclude diesel power from any car at this stage."