Acura gains clout, searches for cachet
Can dedicated team boost maturing brand's allure?
Accavitti: Acura is "ever bit a luxury brand."
LOS ANGELES -- For nearly three decades, Acura and Honda were under the same tent at American Honda, with marketers, product planners and regional sales staffs splitting their time between the two brands. There have been some Acura-only employees in recent years, but for the most part, Honda Motor basically treated Acura products as upscale trim levels of Honda-badged products.
And it showed.
Acura has been wandering in the desert for years, plagued by bland product, inconsistent marketing and a muddled alphanumeric vehicle-naming strategy.
American Honda Motor Co. executives hope that their decision this month to create a cohesive sales and marketing silo for Acura, along with an r&d team dedicated to the brand, will be reflected in smarter product and better marketing -- and a better share of mind with Honda Motor Co. executives in Japan.
The new structure is similar to what Toyota has done with Lexus and Volkswagen with Audi. But just how much can the restructuring do for a nearly 30-year-old luxury brand that is still struggling with image issues?
Unlike Lexus, there is no Acura brand in Japan or Europe. Overseas, Acura products wear Honda badges. Nearly all Acuras are assembled in the United States, making it even harder to get on the radar of Japanese executives.
"Not many shoppers view it as a luxury brand. It doesn't have the status of a Lexus or Audi. It's more like a Buick, a semi-premium vehicle," said AutoPacific analyst Dave Sullivan. "They don't seem to know what direction they want to go in. They don't have the Lexus experience at the dealer. No one is clamoring for an Acura."
Honda executives and dealers are optimistic that recent steps will change that dynamic. A key problem was that American Honda had "long been separated by function rather than brand. Automotive operations was different than auto sales," said John Mendel, American Honda's executive vice president.
Another problem was that national and regional strategies did not align. Having distinct brand silos will keep those twin strategies on-message, Mendel said in a recent conference call.
Art Wright, a Honda and Acura dealer in Lehigh Valley, Pa., welcomes the changes, saying, "We were going nowhere under the old structure."
Wright describes the current Acura identity as "schizophrenic." The MDX and RDX crossovers are hot sellers that frequently conquest the German brands and Lexus. But the sedans get no traction against other luxury brands. He holds out hope that this summer's critical launch of the TLX, an Accord sibling that replaces both the TSX and TL sedans, will provide a bit more allure.
Mendel doesn't dispute the criticisms made by Wright and others of Acura's inconsistency.
"We need dedicated resources and a dedicated organization [for Acura], to not get 'averaged out' when you compare it to the Honda brand," Mendel said. "There's a lot of recognition that Acura should be and can be a much stronger brand."
Mike Accavitti, the brand's new general manager, confidently sees the future Acura "as being every bit a luxury brand as the Germans or the other Japanese or the domestics."
Acura will have to move quickly to get there. Most luxury nameplates that borrow mass-market underpinnings take care to hide their mainstream roots. And while the redesigned RDX has a V-6 under the hood -- instead of its Honda CR-V sibling's inline-four -- Acura saved money by shelving the RDX's Super-Handling All-Wheel Drive system for the CR-V's more pedestrian system.
And when comparing the ILX compact sedan with its Civic cousin, AutoPacific's Sullivan carps: "The ILX has a hollow-door sound, and the door handle feels like it's going to break off. This is not luxury-car quality."
For all the pounding Acura takes from critics, empirical data show plenty of potential for the brand on the flip side of its weaknesses. For instance, more luxury-vehicle owners are considering buying Acuras next than Infinitis or Lincolns -- 31 percent vs. 24 and 16 percent, respectively -- according to AutoPacific data. Still, the German brands, Lexus and Cadillac have much higher intention rates.
And while Acura has a high conquest rate of luring people out of their nonpremium cars, it also loses a disproportionate amount of customers back to the mainstream.
"There is no way the hot chick in This Is 40 would be driving an Acura," Sullivan said, referring to the movie whose lead characters own a Lexus and a BMW. "It's not the brand you think of when you think of luxury. It's the one you move into when you are comfortable with your Accord."
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