Honda goes all-in with 2013 Accord
Automaker bets redesigned car brings its mojo back
SANTA BARBARA, Calif. -- After thriving for decades with an evolutionary model for product development, a struggling Honda has made the risky move of a clean-sheet redesign of its 2013 Accord sedan.
While Toyota was cautious in its Camry redesign last year, Honda has changed nearly everything with the Accord. It has a new direct-injection engine family, a new continuously variable transmission, a front suspension design change and a new crash structure.
Honda Motor Co. CEO Takanobu Ito prodded the Accord development team to produce a no-excuses comeback vehicle. Honda executives acknowledge that they desperately need the redesigned 2013 Accord arriving this month to be the car that turns the company around after a couple of years of trouble.
It is the last of four core volume products Honda has launched in a two-year period. After the Accord, CR-V, Civic and Odyssey launches, all of Honda's cards are on the table.
"This is our most important car," said Takuji Yamada, executive vice president of American Honda Motor Co. "This car is who we are."
The Accord is Honda's make-or-break profit center. More than 11 million have been sold in the United States since the car was launched 36 years and eight generations ago. But the Accord has slipped in sales, share and consideration as other automakers' mid-sized sedans have improved.
In a separate announcement today, Honda said prices on the redesigned 2013 Accord sedan will increase, on average, by less than $300, even with the addition of thousands of dollars worth of standard features and technology.
Pricing on the base Accord LX with manual transmission will increase by $200 to $22,470. The Accord LX with a new continuously variable transmission -- expected to be the most popular model -- will also increase by $200 to $23,270, Honda said.
Honda cannot afford another public humiliation like the one it received with the lambasting of the cheap interior materials used in the 2012 Civic redesign. The Accord is the car that defines whether Honda has regained its mojo.
Honda Motor has taken its lumps of late from a string of uninspired products; the Japan earthquake that crippled its r&d operations, making it the hardest hit of any Japanese automaker; the Thailand flooding that smashed a chunk of its supplier network; and a strong yen that squeezes the profit from dollar-denominated U.S. sales.
The 2013 Accord also is the first Honda developed completely under the watch of Ito, who took command of Honda Motor in February 2009 soon after the global economy imploded.
Ito, an engineer who helped develop the aluminum body of the Acura NSX supercar, also has taken his lumps. He formally took blame for the Civic's cheap interior, saying he approved a last-minute removal of content from the car to lower its price in the slumping U.S. market. But Ito also gave the underlying message that such an error would not be repeated.
At the Accord press event here, a phalanx of Japanese engineers beamed with pride -- indeed, with rarely seen swagger -- when standing next to their new charge. That also was a sea change, for two reasons: First, there was little mention of U.S. engineering involvement in the car's development, whereas Honda's PR message normally reinforces how "American" a vehicle is. And, second, for the past several years, Honda engineers typically have been reserved rather than boastful.
Might this be the start of a renaissance at Honda?
Shoji Matsui: No excuses allowed
For the 2013 Accord redesign, Honda called on a 30-year veteran to be chief engineer.
Shoji Matsui engineered Accords for the 1986 to 1996 model years -- the car's heyday, when its road performance and refinements gave it an aura of prestige. Matsui's first job was to design the fuel-filler cover for the 1986 model. His mentor: Takanobu Ito. For the 2013 car, Matsui says his mission from Ito was to "put our power together on this, without excuses."
But for all the changes, how much better is the 2013 Accord?
The Earth Dreams engine family delivers more power, better fuel economy and lower emissions. With its direct injection and variable cam and valve-lift timing, the new four-cylinder engine puts Honda in the thick of the engine technology race.
The Accord now has a continuously variable transmission -- unfortunately similar in design to the Nissan CVT that has been on the market for the past five years and has received poor marks for refinement and reliability.
Honda's placement of CVTs in every four-cylinder Accord with an automatic transmission -- 75 percent of all Accord sales -- is a high-risk move.
Purists will decry Honda's decision to move from the elegant handling of its front double-wishbone suspension -- a Honda staple since 1986 -- to the somewhat cruder MacPherson strut setup. When Honda made a similar switch to the Civic in 2001, claiming cost, packaging and ride-comfort improvements, many industry watchers said that was the moment Honda began to lose its mojo.
Matsui said the Accord's strut suspension has "better high-speed stability and less noise" and saves 33 pounds. He said the mostly unchanged rear multilink suspension will keep the car's handling spry.
But one of the key changes to the car -- trimming its overall length by 3.5 inches -- may have a very specific source.
"The previous Accord was too big," Matsui said. "It didn't fit in my garage in Ohio" near Honda's U.S. r&d center. "It was 3 inches too long."
Meeting the market
The redesigned Accord arrives in the midst of a mid-sized sedan dogfight. The best-selling Camry is hitting its sales stride one year after its re-engineering. Meanwhile, a re-engineered Nissan Altima just hit the market; redesigns of the Ford Fusion and Chevrolet Malibu arrive this fall, and an updated Mazda6 comes in the spring.
George Peterson, president of the consulting firm AutoPacific, said: "Accord and Camry still get the first shot with American consumers, whereas everyone else has to fight to be considered."
But that dynamic is changing. The Accord's retail market share of the mid-sized segment has slipped markedly since 2007, from 21 percent then to 14 percent through May, although it still holds a solid second place to the Camry, according to R.L. Polk & Co. data.
But in total sales, which include fleet sales, the Altima was breathing down the Accord's neck through August.
Meanwhile, second-tier cars such as the Hyundai Sonata and Kia Optima have made big jumps in shopper consideration against the Accord, according to Compete Automotive data.
Perhaps more worrisome to Honda is that the Accord's 36-month residual values have slipped from 52 percent for 2007 models to 49 percent for 2012 models, according to ALG, the TrueCar Inc. subsidiary that effectively sets residual values for the auto industry.
Meanwhile, the overall segment residuals have increased. As a result, the Accord's premium over the segment average has slipped from seven percentage points to two, ALG says.
John Mendel, American Honda's sales boss, knows the challenge awaiting his new sedan.
He called the Accord launch "the single most important in our history."
"It is a key contributor to our U.S. and global success," Mendel said. "It is a bellwether for our brand."
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