Honda to Reassess Hybrid Demand After Accord

[Tempus]

http://quote.bloomberg.com/apps/news?pid=1...McY&refer=japan

June 17 (Bloomberg) -- Honda Motor Co., the first to sell gasoline-electric hybrid cars in the U.S., wants to reassess consumer acceptance of the fuel-saving vehicles this year after adding its third such model, a version of its Accord sedan.

The automaker isn't sure how buyers will react as gasoline prices fluctuate and as the hybrid systems add thousands of dollars in costs, said Dan Bonawitz, Honda's U.S. vice president for product planning, in an interview at a briefing in Croton Falls, New York. Honda has sold 60,013 hybrids in the U.S. since its Insight car debuted in 1999.

``We're really going to kind of watch. We're introducing the Accord with a different approach and then I think the price of fuel, the cost differential are factors,'' Bonawitz said. ``We're prepared to move if we need to or want to.''

[bookrats]

Actually, reading this, I half wondered if this meant Honda was going to get out of the hybrid market. Or, at least, had been considering it before the gas prices went up.

The Insight never sold that well; and the Civic Hybrid has been coming in 2nd to the '04 Prius. (Though it might have been doing better against the Prius Classic -- I don't remember.)

[Tempus]

I think Honda is being rightly cautious. Hybrids are taking some backlash, and from the other thread, Honda has pretty good diesel tech up it's sleeve

Remember, Honda doesn't have the deep pockets that Toyota does. They have to be spot-on with their R&D dollars and can't afford to lose any really big gambles.

What it probably does mean though, is that it's going to be up to Toyota and Toyota Tech licensees to carry the Hybrid Banner. I don't see people lining up to use the Honda Tech.

That also means that Honda can't recoup as much of the development costs, and won't have the parts volume savings that Toyota will, so Toyota has yet another advantage.

The Toyota HSD success has put Honda in a situation where they have to tread very carefully.

[Danny]

This is total hearsay, but I've heard speculation that if Honda doesn't turn a few things around that Toyota is going to be in position to buy them out in 5-10 years.

What do I think would be the best approach when marketing a Hybrid vehicle?

Make them entirely new vehicles (like the Prius) & develop them under a new brand (kinda like Scion for the tuner-crowd). This way no one has any comparison as to how much the hybrid system is adding to the cost of buying the car and it develops a new market for the manufacturer.

The Prius is hot because no one has anything to compare it to - it's not like they took an Echo and made it into a hybrid (which is how I personally viewed the Classics before knowing anything about them). I'm afraid that the Hylander Hybrid, RX400h, and Accord will not see near the sales #s we need to see to make hybrid technology a "market buster".

[Tempus]

Hmm, I don't know.

The approach they're taking with the Accord and RX is "More Performance AND Better Mileage".

So, just like people are willing to pay more to get a V8 they don't really need in a mid-size car/truck, some folks will pay a premium to have the Hottest Accord Available who may not care about about the mileage.

Seems like they have two possible markets by marketing it that way.

Guilt Free Performance could be a big pull for a lot of people. You can blow off the V6 Accord at the light and still thumb your environmental nose at them.

[pkjohna]

The approach they're taking with the Accord and RX is "More Performance AND Better Mileage".

Hey, don't knock it. That's what first drew me in to actually take a look at the '04 Prius. When I read that Toyota had managed to make it bigger, with better mileage and better performance I just had to see for myself. I still get a kick out of occasionally surprising someone off the line at the stoplight yet I'm still averaging a little better than 50mpg. What a country! :mrgreen:

[bruceha_2000]

I agree Danny. There has to be a bigger draw than "the same car only it gets 50% better mileage and you pay $2500 more for it". At $2/gal and 15K miles/year you need a lot of years to recover that difference. Most people have to consider their wallet first, other things second. I'm hoping Toyota can mainstream the hybrid parts such that they can put them in any vehicle for the same price, then dump the non hybrid versions. Thus we are all better off because there is substantialy less gas being burned.

[bruceha_2000]

The Insight never sold that well; and the Civic Hybrid has been coming in 2nd to the '04 Prius. (Though it might have been doing better against the Prius Classic -- I don't remember.)

I'm not surprised Honda didn't sell a lot of Insights, and I doubt they are either. I don't think that was the intent of the car. More in line with testing the hybrid technology with those most interested in what it has to offer - mpg and emissions.
It just isn't practical for a lot of people. Most who buy a 2 seater want a sports car, not a commuter. When your best mpg vehicle only carries 2, you can't take the family on those trips where 60 mpg vs 25 would be great. And, at $20K plus, it isn't a cheap ride to work. I'm sure for some it is a GREAT car. It doesn't have the distance and speed limitations of full electrics. If you are a 1 or 2 person family, no problem Could my family of 4 use it? Yeah, the 3 days a week when my wife doesn't do the morning "kid carting" with me covering the afternoon. But I have neither the driveway space nor the spare cash to have a 3rd car that would save me (and the environment) 120 gallons of gas a year to commute to work assuming I could use it every day (which I couldn't).

The 2004 Prius beats both the classic and the Honda Civic Hybrid on most counts. Other than rear seat headroom, I see no reason to even consider the other 2 vehicles. They have smaller interiors, have no way to expand the trunk into the passenger space and get lower MPGs. The 2004 would have to be more expensive than the others to balance its strengths and it isn't.

[bruceha_2000]

Hey, don't knock it. That's what first drew me in to actually take a look at the '04 Prius.

Except that the current V6 Accord has more than enough power than most anyone actually NEEDS and the hybrid won't be any bigger from the passenger/cargo POV. It remains to be seen exactly what "the mileage of a 4 cylinder" means on the road. How many people are going to pay a premium for the same car that gets somewhat better mileage?

I think it would make more sense for Honda to put the hybrid in the standard 4 cylinder Accord giving it a boost in both power and mpg.
Maybe you can tow something with the V6 you can't with the 4 and perhaps a hybrid in the standard 4 could match that, thus eliminating any need to go up to the V6 :-)

Just for grins, I road tested my low powered '95 Odyssey - 0-35 mph at 'hard off the line' and at 'what I and most everyone else actually do'. Came up with something over 5 seconds for a 'stand on it' start (OK a LOT of cars would be at 45 by then and some at 60 or more). The 'normal' start was about 10 seconds. You can get your Prius to 60 in that time, but do you ever need to do it? Maybe, if you travel I-5 with the signals at the top of the ramp and traffic at 65+ mph. But I drove that in my rental 2003 Prius last July and you know what? I got into traffic without being killed or feeling like I was about to be.

[Tempus]

Since when have Americans been able to distinguish between "Needs" and "Wants"?