Honda is Slipping Into Reverse
Given the troubles of archrival Toyota, Honda should be cleaning up this year, msnbc reported. It isn't working out that way. After a decade of nonstop growth in the U.S., Honda Motor fell from a 10.5 percent share in the first quarter of 2009 to 10.1 percent in the same period this year. (Rival Nissan Motor now has 9 percent, up from 7.9 percent, and Hyundai Motor is up to 4.4 percent, from 4.2 percent.) Honda "has lost its mojo with new model launches," says Jessica Caldwell, a senior analyst at car shopping site Edmunds.com. While Honda's sales are up 12.5 percent from last year's dismal first quarter, the overall market grew by 17.1 percent. The company once offered a sportier alternative to stodgy-but-reliable Toyota Motor, but Honda's cars now look pale alongside newer models from Nissan, Hyundai, Ford, and General Motors, says John Wolkonowicz, an analyst at IHS Global Insight. With its reputation for performance and handling, Honda "used to be the Japanese BMW," Wolkonowicz says. "It's not anymore." Honda declined to make any executives available for this story. A spokesman says the company isn't concerned about market share; it is profitable and remains focused on providing reliable, safe, efficient cars. Nonetheless, Honda in March offered cheap leases to battle 0 percent financing deals from Toyota as that company sought to shore up sales in the wake of its recall problems. Honda's program boosted interest somewhat, but the market-share slide continued. The new Accord Crosstour is emblematic of Honda's woes. Honda launched the model in November, billing it as a mash-up of an SUV and a sedan. Trouble is, the Crosstour has neither the room of most SUVs nor the look and feel of a sedan, says James N. Hall, principal of 2953 Analytics, an auto consultancy in Birmingham, Mich. And the Crosstour only comes with a V-6 engine, pushing the price to $30,000. Not only is it about $3,000 more than Toyota's competing Venza but it also uses more fuel. This year the Venza has outsold the Crosstour by nearly 2 to 1. Honda has similarly stumbled with the Insight. During the hybrid's splashy relaunch last year, Honda pitched it as a less expensive alternative to Toyota's Prius. In 2010, Honda has moved fewer than 5,000 Insights in the U.S., about one-sixth the number of Priuses Toyota has sold. And in March, Ford's Fusion hybrid edged out the Insight 1,670 to 1,652 even though the Fusion costs some 35 percent more. While the Fusion is roomier, it gets nearly the same gas mileage, about 40 miles per gallon. Even Honda's core models are under pressure. The Civic compact, the No. 6 seller in the U.S. in 2009, is No. 7 this year, researcher Autodata reports, and sales of the CR-V are off by 4.2 percent. And while Accord sales are growing, Honda opted for more conservative styling when it relaunched the sedan last year. Now potential buyers are exploring other options; a year ago, only 5 percent of visitors to Edmunds.com interested in the Accord also checked out the Hyundai Sonata, and 6 percent looked at Ford's Fusion. This March, 12 percent of Accord shoppers considered the Sonata and 9 percent gave the Fusion a look. One such shopper is Charles Summers, who works for a human resources firm near Atlanta. With his first child on the way, Summers figured he would trade his 2007 Hyundai Elantra for an Accord. But he found the styling bland and felt the Sonata was more comfortable. So he spent $26,000 for a Sonata, while a similarly equipped Accord would have cost more than $28,000. "I thought for sure I'd end up with an Accord," Summers says. And that's how market share slips away.
More Industry

Auto Affordability Inches Up
The latest Cox Automotive and Moody’s Analytics index shows a slight increase in new-vehicle affordability despite high prices.
Read More →
Ohio Auto Group Under New Ownership
After 79 years with the Schluter family, Mansfield Auto Group has been acquired by Missouri-based Clement Auto Group.
Read More →
RV Group Expands Carolina Footprint
Blue Compass RV Columbia Northeast is the 13th RV dealership owned by Blue Compass in the Carolinas.
Read More →
Agent Acumen
An Agent Summit panel of people who’ve been supporting auto dealers for years gave both timely and timeless advice for those starting out or mulling the prospect.
Read More →
Missed Maintenance Creates Opportunity
As families get back on the road and into daily school routines, service drives have an opportunity to capture customers who are behind on recommended vehicle maintenance.
Read More →
Mitsubishi Unveils U.S. Plan
The automaker announced a strategy that includes an expanded lineup and dealership presence, along with more ‘rugged’ and electric models.
Read More →
Selling to Grow
The question of whether you should sell your agency and if so, when, is up to you. But it’s a question worth asking to ensure you keep the business on the right path for yourself, employees and clients.
Read More →
Recalled Vehicles Hit 5-Year High
Though the number of events has fallen so far this year, impacted units are up significantly. Meanwhile, regulators consider consumer notification changes.
Read More →
Auto Group Acquires Top-Performing Rooftop
Car Pros sold its Kia Huntington Beach location to Sutherlin Automotive Group, marking the buyer’s third location in Southern California.
Read More →
China as Pacesetter
Automotive leaders huddled on where North America stands in the global picture and how it can strengthen its position against the Asian juggernaut’s surging industry.
Read More →