Honda is fixing inventories now, the Civic in the fall
LAS VEGAS -- Honda will bring out a significant midcycle change to the Civic compact this fall, just 18 months after it was launched, executives said at the make meeting.
The rapid change will arrive at about the same time as a redesigned Accord and is part of Honda's plan to increase sales by 24 percent this year. Honda executives also said inventories will be back to full supply by the end of March. Some lingering supplier issues meant that the mix of various trim levels was not at usual percentages, which hurt sales, said John Mendel, executive vice president at American Honda Motor Co.
The Civic has been the subject of negative media reviews, regarding its cheapened interior and other decontenting moves. The Civic also was removed from the recommended list by Consumer Reports.
Mendel previously had said the automaker hoped to get a midcycle freshening for the Civic sometime in 2013. More recently, Honda executives said they hoped a change could come by the end of 2012.
That alone would have been a feat, as most automakers wait three years into a five-year cycle for a midcycle change. Most midcycle changes involve minor freshenings of the front and rear fascias and some small interior updates. A dealer source said the 2013 model year change would be a more significant improvement than that.
With inventories in check, Honda said it expects its 2012 sales to increase by 24 percent, well outpacing the industry.
"We've been taking some heat, and Honda is determined to correct that," said Dave Conant, CEO of Conant Auto Retail Group in Cerritos, Calif. "We're expecting to see some huge boosts in Civic, CR-V and Accord this year."
Mendel believes Honda can sell more than 300,000 units apiece of the Civic and Accord this year, up from 221,235 Civics and 235,625 Accords in 2011. Mendel was encouraged by the Civic -- despite its plasticky interior -- being the best-selling compact in January, with 21,883 units sold. And while the CR-V sold 218,373 units last year, dealers said a target of 250,000 was mentioned.
Nearer-term, Honda inventories should be completely replenished by March, said Bill Woeste of Honda East in Cincinnati, who is also dealer advisory board chairman.
Woeste called the brand's Super Bowl ads "our first salvo that Honda is back."
Conant said dealers are still miffed at Honda's continued reliance on "flex cash" stair-step volume incentives. Although nothing was resolved at the meeting, dealers aired their grievances that Honda uses the strategy too often.
"But when Honda does it, it sees a sales surge," Conant said, "so the discussions will continue."
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