MARK RECHTIN

The story behind low Acura ILX production numbers

Automotive News | April 16, 2013 - 2:18 pm EST

Mark Rechtin is West Coast editor of Automotive News.
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LOS ANGELES -- Those with keen eyesight will have noticed an aberration in the production numbers listed by the Automotive News Data Center.

The Honda Motor Co. plant in Greensburg, Ind., built just 91 units of the nearly new Acura ILX entry-luxury sedan in March. This came after a couple of previous slower months.

American Honda executives have admitted the ILX has not had the strongest launch. They acknowledge that the base 2.0-liter engine is a bit underpowered, and only offering a stick shift on the improved 2.4-liter engine has deterred shoppers.

Still, once the ILX got its balance, the car has run near a pretty steady 2,000 sales a month, a bit shy of its projected sales rate. Inventories are a little high, about 90 days. But neither result is anything to cry over for a new entry still finding its way.

So, it would be easy -- but incorrect -- to jump to the conclusion that the March production drop was a sign of Acura tapping the brakes on ILX.

Here's why: resource allocation.

The Greensburg plant also builds the Honda Civic. When Honda decided to make a major midcycle change to the 2013 Civic late last year, it knew it would have to crank up those inventories to fill the pipeline. After all, Honda sells 10 times more Civics than Acura sells ILXs. Even though Honda builds Civics at three North American assembly lines, it still meant ILX production at Greensburg would have to make way.

During the build-out transition from the '12 to '13 Civic, Honda made the most of its ILX production, assembling 14,557 ILXs between August and October. That would represent a half-year's worth of sales, on top of the big launch volumes the plant cranked out earlier in the year.

But since then, it has been the Civic's turn, and Honda has dialed back ILX. The reliance on the Greensburg plant for Civic was even greater, because one of the Alliston, Ontario, lines that builds the Civic also builds the CR-V crossover, another hot seller.

"Our plant flexibility allows us to balance inventories every month," said American Honda spokesman Ed Miller. "No other company in North American can flex among vehicles as we do. In March, we simply needed to produce many more Civics in Greensburg, so we did."

In fact, March Civic production in Greensburg was the highest one-month total in the history of the plant.

Miller said to expect light ILX production for the next few months, as the '13 model phases out and the '14 model -- "with some nice changes" -- starts up.

Megadealer Dave Conant, whose holdings include an Acura store in Mission Viejo, Calif., said ILX represents about 20 of the 70 new Acuras he sells every month.

"ILX came out of the gates a bit slowly. More recently, we've figured out a great lease offer, so ILX is a contributor for us," Conant said. "We are in good shape on inventory balance, but a bit concerned we will run low."

Honda sold 5,614 Acura ILX sedans in the United States during the first quarter.

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