Honda expects a surge in 2008
December 19, 2007
According to John Mendel, Executive Vice-President of American Honda Auto Operations, the Japanese automaker expects a sales boost of 3 to 5% despite flat market predictions for year 2008.
During Mendel’s visit in Detroit, America’s automotive capital, he said that sales for light vehicles in 2008 will be around 15.3 million units. Comparing to expected unit sales this year of 16.3 million, it is far lower.
The new and improved Honda Accord and CR-V raised the total vehicle sales of the automaker by 3.1% totaling to 1.4 million units.
Aside from these two sales boosters, Honda is expecting that the Honda Pilot, its new three-row SUV and its subcompact Honda Fit will follow the footsteps of the Accord and the CR-V.
"We haven't let our foot off the gas on the product development side," Mendel said.
Mendel also said that his company could closely appeal to consumers by producing more fuel-efficient vehicles just in time when oil prices are continuously increasing.
"When fuel prices are an issue with consumers, I think we benefit even more because we either lead or are among the leaders in every segment where we compete," Mendel said.
According to Erich Merkle, Director of Forecasting for IRN Inc., Honda’s sales expectations for next year are realistic. IRN Inc. foretells that next year, overall light vehicle sales will be around 15.5 million units.
For Merkle, their sales are not vulnerable for slow down to go with the American economy. Their consumers belong to the higher end of the economic class. And also, Honda is not a player in the full-size truck segment so their production can go unaffected by the slumping housing market.
"I think they'll probably be the leader in terms of market share gain," Merkle said. "I only say that because 3% to 5% growth" for an automaker "in the next year is going to be phenomenal."
Although sales have been good for Honda this year, its luxury nameplate, Acura (producer of quality Acura Cl AC receiver drier) was not selling like its parent brand. Acura’s sales are down by 10.8% so far.
Making Acura a certified luxury brand to be in line with BMW, Lexus, Mercedes-Benz is one of Honda’s biggest priorities, says Mendel. He added that the company is finding ways to reshape its upscale brand. Opening a new design studio for Acura in California earlier this year was Honda’s first step for Acura’s revival. "The next logical step is to start to see some of that product flow through," he said.
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