Honda Australia targets 48,000 sales in 2017
BY DANIEL DEGASPERI | 8th Dec 2016
The forecast figure for next year exactly matches that of Kia Motors Australia (KMAu) and would thrust both brands beyond Subaru into a fight for eighth place on the top 10 sales charts.
However, speaking with GoAuto at a media event in Melbourne this week, Honda Australia director Stephen Collins downplayed the sales race but said the brand was already regularly in seventh position with private buyers and did not participate in the rental market, unlike Kia.
“We’ll announce that officially our number will be 48,000 for next year (and) that’s big growth in a market that is only up one or two percentage points,” he said.
“It will be pretty much on the back of Civic hatch – which we have not been competitive with for a long, long time – and CR-V. We’ve had two years of 40,000 (sales) and we’ve tried to stabilise our business and get those core cars spot on, and the next 12 months for us are about growing those two cars particularly.
“We measure our business by private share, I mean we look at total share but it doesn’t really drive us that much. Our private share (of the total market) is around 6.5 per cent, so as an example in the last two months I think we’ve been ranked number seven in the market ahead of some other pretty big players who do a lot of fleet, rental and other type of business.” Based on official VFACTS November results, Honda’s market share of 3.4 per cent was adrift of Kia’s 3.6 per cent and Subaru’s 4.0 per cent. Although it includes hatchback players as well, the sedan-only Civic’s 3.2 per cent overall share of the sub-$40K small-car segment is substantially lower than its private portion, according to Mr Collins.
“A good example I always think is Civic sedan,” he continued.
“Since we launched Civic sedan, it has around 20 per cent private market share, so one in five people since we launched in June are buying a Civic sedan and we don’t compete in the rental business, and that’s been matching it with the best players in that segment.
“I think HR-V has 13 to 14 per cent private market share, even Jazz has maybe 11 or 12 per cent private market share (so) that is the true measure of our business and we think we’re in a pretty good position.” According to VFACTS, the HR-V has taken a 12.4 per cent slice of the small-SUV segment year to date, while the Jazz has gained a 9.0 per cent share of the light-car class.
“We talk a lot about our core products, and our core products are basically HR-V, Civic, CR-V and Jazz,” he continued.
“Particularly HR-V, Civic and CR-V next year will probably make up I’m guessing probably 70 per cent of our business. So that’s what were really focusing on, getting those core cars right.” He said the Civic should achieve beyond 1500 sales per month, and the CR-V would match the HR-V and target at least 1000 units – giving Honda annual sales of 42,000 units based around three models alone.
Adding a hatchback to the Civic sedan range will occur first, in February 2017. Unlike the outgoing two generations of Civic hatchbacks imported from the UK, the 10th-generation model will come from Thailand, a substantially cheaper manufacturing base.
“The reality is to be among the top with a sedan and a hatch and you’re competitive, you’ve got to be selling 1500 or more per month and I think that’s where we want to be,” Mr Collins said.
“Then it will be topped off with Type-R from the third quarter of next year, which just adds that Type-R element, the excitement, the sportiness … and I think it’s been a building of Civic for us and it will all come together as we enter next year.” He said the Type-R should add “a couple of hundred” extra sales to the Civic tally, giving the nameplate the potential to crack 20,000 annual units.
He added that there is “a desire” to price the Type-R at below $50,000 and its sales potential really “depends on where we price it I think.” “We’ll make it competitive. We don’t want it to be a fringe car that you don’t ever see one. That hot hatch segment is pretty competitive and there’s definitely the die hards who have definitely wanted to have a Type-R previously and they are just hanging out for this thing, and I think there are also the conquest type buyers who just want the hottest hatch in the market.
“Our goal is to deliver that.” Mr Collins said it was promising that the existing flagship Civic RS sedan was the highest seller of the range with a 26 to 27 per cent sales split, despite costing $31,790 plus on-road costs. The hatchback will mirror the current CVT-only line-up of VTi, VTi-S, VTi-L, VTi-LX and RS, but would not steal sales from sedan.
“(With Civic) we’re not targeting number one, we’re targeting in the top three,” he added.
“I mean, I’d love to be number one but I think the reality is we have to re-establish Civic and we haven’t played in the hatch market for a long, long time. So we need to get back on the shopping list of hatch buyers.” Topping off Honda Australia’s 2017 will be the CR-V arriving from Thailand in the third quarter, which Mr Collins confirmed will include from launch with a full range of petrol-engined two- and four-wheel drive model grades.
“Clearly (Mazda) CX-5 is the benchmark, and the volume they’re doing is consistently 1500 or more per month,” he said of the new CR-V’s sales target.
“So for us to get in amongst the top … we will need to do around 1000 per month. This current generation is selling quite significantly below that, but the segment is growing and you just have to look at the top half a dozen or more players in that segment that are all doing 1000 per month or more.
“That’s where you’ve got to be.” Mr Collins insisted the CR-V will be a “competitive offering” but ruled out a diesel engine from the line-up (see separate story).
The outgoing CR-V has accumulated just 7308 sales with one month of the year remaining – at an average of just 664 units per month.
