Honda, with sales off 7%, loses market share in 2011
LOS ANGELES -- What began as a promising year for American Honda Motor Co. ended as one of the worst in the automaker's recent history as natural disasters continued to wreak havoc on the automaker's supply chain, output and inventories.
Despite offering 0.9 percent financing on most Honda Division vehicles for up to 60 months as part of its "Happy Honda Days" marketing campaign, American Honda's December sales fell 19 percent from a year earlier to 105,230. Honda Division sales fell 19 percent last month to 92,101 vehicles and Acura Division sold 13,129 units for a 15 percent decline.
The automaker's 2011 sales totaled 1.147 million vehicles, down 7 percent from 2010 and its lowest total since 1999. Honda-brand sales fell 7 percent from 2010 to 1,023,986, and Acura sales slipped 8 percent to 123,299.
"As we eagerly close one of the most challenging years American Honda has weathered, we are well positioned for a strong 2012," John Mendel, American Honda executive vice president of sales, said in a statement. "Although we still had low inventory in December, our production levels are now back to normal."
American Honda's U.S. market share fell from 10.6 percent in 2010 to 9 percent in 2011. The decline marks the second year in a row American Honda lost market share while total industry sales grew. The last time the automaker ceded market share while the industry expanded for two consecutive years was in 1992 and 1993.
Combined Honda and Acura sales rose 17 percent in the first four months of 2011. But American Honda sales fell by more than 20 percent every month from May through August because of inventory shortages stemming from the March 11 Japanese earthquake.
With production getting back to normal, Honda suppliers were hit again by flooding in Thailand in October that disrupted the flow of parts to Honda's assembly plants in North America and elsewhere.
Adding to Honda's woes last year, the redesigned Honda Civic was widely panned for a subpar interior and lackluster styling when it was released in April. Consumer Reports refused to give the Civic, a perennial favorite of the influential publication, its coveted "Recommended" rating.
Honda has said that the worst is over. It promised dealers in late November that they would have an ample supply of vehicles because factory output from December 2011 through February 2012 was expected to exceed prior-year levels.
Honda dealers will also get key new products this year, like the redesigned Honda Accord due next fall. The sedan will join the redesigned CR-V crossover and a refreshed Civic that could arrive by year end.
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