Honda has had a good start to the year in western Europe, but it is stumbling at home.
In February, Honda posted the biggest drop in Japanese sales of any of Japan's Big 5 carmakers: 21.4 percent. That fall, to 62,596 units, marked the fifth straight month of decline. The slide contrasts with an 11.3 percent leap that Honda reported in a down western European market in February.
One reason: Honda has depended too much on the Fit supermini at home. The Fit - known as the Jazz here - was the 2002 Japanese best seller. But analysts say the Fit has cannibalized sales of other Honda models such as the Civic.
"The Fit seems like a double-edged sword for Honda," said Shigeharu Kimishima, an analyst for Mitsubishi Securities.
Meanwhile, Nissan is making an aggressive push into the Japanese small-car segment with the March and Cube, targeting the same buyers as the Fit. And Toyota unveiled the Wish minivan in January as a rival to the Honda Stream.
Not surprsingly, Honda is feeling the pressure. In January, it cut its Japanese sales estimate for the fiscal year ending March 31 by 2.2 percent to 880,000 units.