This year Honda Division expects its sales to increase nearly 4 percent, to 1.3 million units. Most of that growth will come from the first full year of sales of the redesigned Civic compact car and the new Ridgeline pickup. The new subcompact Fit hatchback, which goes on sale in April, should bring about 33,000 incremental sales.
John Mendel, senior vice president of automobile operations for American Honda Motor Co. Inc., talked with Staff Reporter Kathy Jackson.
Can companies make money on subcompact cars?
We can make money. We sold 1.3 million globally and didn't need an extra plant. This segment is where we think the market will grow. They are much better than the old B-segment cars.
Will 2006 be a robust year for vehicle sales?
I think it will be the year for Honda. It will be the first full year for the Ridgeline and the Civic, and we have the new Fit coming on.
If we see incentives start to moderate, the industry will be about 16.5-ish. If incentives stay high, we could deliver another 17 million.
The industry has been great. Anybody who didn't buy a car the last four years was in a coma.
Honda doesn't do consumer rebates. Are you in favor of them?
Absolutely not. I have never been a proponent of cash rebates. That's the worst thing you can do to erode residuals.
Were you happy with Ridgeline sales last year?
We came out of the gate slow. Dealers ordered a richer mix than what the consumers wanted.
But we will probably sell over 50,000 this year, the first full year. That's what we always said we'd do.
Will Honda ever give its dealers a V-8 engine?
We don't think we need to go there. But does that mean never? No.