TOKYO -- With Ridgeline sales starting out slower than expected, Honda Motor Co. is cutting production of the new pickup.
Honda is taking 3,000 units out of its January-March production plan. The full-year target was 50,000.
Honda CFO Satoshi Aoki revealed the plans to cut production during a press conference announcing Honda's earnings for the quarter ended Sept. 30.
The Ridgeline, Honda's first foray into the pickup segment, is built exclusively in Alliston, Ontario. The vehicle went on sale in March. Sales through September in the United States totaled 25,787.
Honda built 17,402 Ridgelines in the third quarter.
In an interview with Automotive News at the Tokyo Motor Show this month, Honda CEO Takeo Fukui blamed the soft sales on high U.S. incentives on light trucks.
He said Honda would not join the incentive wars to jump-start Ridgeline sales.
"We won't introduce any incentives," Fukui said. "We'll adjust our production."
Honda executives said they hope to lower overall incentive spending in the United States. But they conceded that Honda's spending has grown more rapidly than expected.
Hideki Okada, general manager of Honda's accounting division, said at the press conference that the carmaker hopes to trim U.S. incentive spending by about one-third in the October 2005-March 2006 fiscal second half compared with the previous six months.
But Honda also raised its forecast for incentive spending for the full fiscal year ending March 31. It now expects to spend between $990 million and $1 billion on incentives this fiscal year.
Last spring, Honda had projected incentive spending of $690 million. It then raised that forecast to $890 million in July.
Aoki said the company's worldwide operating profit in the quarter fell on higher incentive spending in the United States.
Honda's operating profits in the quarter declined 5.9 percent to 162.69 billion yen or about $1.44 billion at current exchange rates.
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