Honda not scared of HR-V rivals

HONDA Australia says it is confident its HR-V compact SUV can maintain its strong sales form against an influx of new crossovers in the coming years.

The HR-V has been a sales hit since its launch in Australia in early 2015, quickly overtaking the Civic, CR-V and Jazz as Honda’s best seller.

Since launch, the HR-V has been offered with only one powertrain – a 1.8-litre four-cylinder naturally aspirated petrol engine driving the front wheels via a continuously variable transmission.

Honda Australia director Stephen Collins confirmed at the HR-V’s launch in February 2015 that a turbo-diesel manual variant would be added to the line-up within a year, but Honda has since dropped all diesel-powered models in Australia and appears to have gone cold on the oil-burning HR-V.

Mr Collins played down the suggestion that the HR-V could be even more popular if Honda offered more drivetrains, saying 2WD petrols were the bulk of the small-SUV segment.

“The vast majority of that segment is two-wheel drive,” he said at the Civic hatch launch in Adelaide last week. “From an engine perspective, we get good feedback on it. It provides good performance, good economy.

“So, you can always add heaps of grades, heaps of engines, and that sort of stuff, but we're going to stick to what's core. And what's core in that segment for us and is working really well, is two-wheel drive, petrol engines with a relatively simple grade line-up.”

In its first year of launch, 2015, Honda sold 10,899 HR-Vs in Australia, making it the fourth best selling model in the sub-$40,000 small SUV segment behind the Hyundai ix35 (15,227), Mitsubishi ASX (13,557) and the Mazda CX-3 (12,656) that also lobbed that year.

Last year Honda shifted 12,403 units to come in third behind the CX-3 (18,334) and the ASX (18,126).

So far in 2017, HR-V sales have dipped slightly by 4.3 per cent to 3732 units, and it is again sitting behind the CX-3 (5750), ASX (5050) and the Nissan Qashqai (3935).

More recently, a number of new competitors have arrived to try and cash in on the crossover craze, including Toyota’s fresh CH-R, a new-generation version of Subaru’s popular XV, an updated Holden Trax and the strong-selling Suzuki Vitara.

And there are more waiting in the wings. In the next couple of years, Hyundai will launch its crucial new Kona crossover, while Volkswagen, Kia, Nissan, Jeep and Skoda all have models on the way.

Mr Collins said he expected the HR-V to continue to be a hit for the brand in Australia, but added that he was aware of the incoming rivals.

“I think HR-V has been very, very consistent. I think on average we do a thousand a month. Sometimes a bit more, sometimes a bit less. And, you know, (Toyota) CH-R has recently come in and some others, and we've pretty much been consistent there.

“We think it (HR-V) provides a really good package, value-wise. In terms of space, we think it's probably the sort of market leader in that small SUV for space and utility.

“We've been very happy despite lots of new entrants coming in. There's more coming across, so we need to keep it fresh and we need to keep working on that.

But it's been very consistent for us.”

Mr Collins confirmed that one of the measures to keep it fresh was to introduce an updated model, probably next year, which would be a mid-cycle update, with a full model change still several years off.

“So we have got an upgrade coming in the not-too-distant future. And then the normal cycle would be, maybe next year, we’d have a minor model change, some styling and so forth. So … it fits into our normal life cycle.”

With the HR-V competing against the larger rivals in the small SUV segment, such as the Qashqai and the Vitara, there is room in Honda’s line-up for a sub-HR-V crossover.

However, Mr Collins ruled out an additional model for the segment for now, such as the emerging market BR-V, as there was nothing in Honda’s global catalogue that would suit the mature Australian market.

“There's a couple global models that don't quite stack up for us, at the moment,” he said.

“Right now the BR-V is more in the emerging markets, rather than in this market. But it doesn’t mean the next generation mightn’t fit the bill. So, it’s definitely on our radar and we’ll have to see what happens in the next generation of cars.”

While he could not provide a timeframe for a new crossover model, Mr Collins said: “It’s not in the next year or so”.