Honda commits to Australia

Honda says it remains committed to the Australian market, following an intensive year-long assessment of the Japanese brand’s long-term future here.

However, it will not publicly reveal the outcome of its 12-month business review until late March -- after it announces any changes to dealer network.

Honda told its Australian dealers during its previous annual end of (Japanese) financial year meeting in March 2019 that it would consider the brand’s local future over the following year.

Speculation in the lead-up to the announcement of the review’s findings this month has been rife with widespread concern within Honda’s local dealer network -- especially in the wake of GM’s decision to axe Holden.

Rumours have included everything from Honda pulling out of Australia entirely, to trimming the number of its retail outlets and even appointing an independent importer to distribute its vehicles – an arrangement GM and Holden reportedly investigated with Inchcape last year.

Honda Australia director Stephen Collins would not comment on those rumours or the company’s long-term market plan, but told carsales the historic Japanese brand would remain in Australia.

“Honda is committed to the Australian market and, as a part of normal business, regularly assesses its operations and organisational performance,” he said.

“We committed to our dealer network that we would update them on our long-term plans in the first quarter of 2020 and we are planning to do this later this month,” said Collins.

Honda Australia insiders told carsales the business is in good shape and continues to increase its share of private customers, for which it has ranked fourth so far this year.

The same sources admit, however, that Honda faces a quiet new product year and that the latest business review was made “more strenuous” by difficult economic conditions, bushfires and, most recently, coronavirus fears.

Against 10 per cent sales market slump so far in 2020 sales of Honda cars are down 12 per cent this year. This comes on top of its 15 per cent sales drop in 2019, when Honda Australia sold just 43,868 vehicles – well down from its 60,000-plus sales peak in 2007.

In 2019, Honda was the ninth most popular auto brand in Australia – just ahead of Holden in 10th with 43,176 sales.

Most of Honda Australia’s svolume comes from the Thai-sourced CR-V mid-size SUV (down 14% YOY), HR-V small SUV (down 3.4%) and Civic small car (down 22%), with the Jazz light hatch next best but almost 24 per cent down YOY.

Honda Australia’s most recent model launch was for an updated 2020 Civic hatch in January. The new Accord hybrid was released in December.

Last month Honda committed to releasing a special-edition Civic Type R hot hatch in early 2021.

However, the brand will axe the small City sedan by mid-2020 and has indicated it will not import the new-generation Jazz hatch revealed in Japan last October until at least 2021.

Honda Australia has also rejected the new ‘Honda e’ EV, apparently leaving little else in its new product pipeline apart from updates for its volume-selling CR-V and Civic, which play in two of the market’s most competitive sales segments.

Honda’s long-term plans for the Australia, one of the world’s most keenly contested automotive markets, could also affect its well established motorcycle, marine and power equipment businesses locally.

Honda Australia celebrated its 50th anniversary last year and currently has 106 car dealerships – many of them multi-franchise – making its retail network about half the size of Holden’s.

Honda products, including its once-top-selling motorcycles, have been imported and distributed by a range of private companies in Australia since the 1950s, but the Japanese brand’s official local presence began in February 1969.