For decades, Hondas have pretty much sold themselves on the usual left-brain merits of durability, reliability, safety and resale value. Really, Honda’s sales strategy has been more about finding ways to let people buy the cars as opposed to selling them with discounts, low-interest financing and savvy showroom tactics. Sure, Honda and its luxury brand, Acura, win few if any plaudits for styling, but the vehicles are quiet, drive well, boast a high level of refinement and are pretty fuel-efficient, too.
No wonder the latest research from Canadian Black Book shows that Honda brand vehicles have the fourth-best 48-month residual values in Canada. Four years from now, your Honda car should be worth 47.7 per cent of its original price, while on the light truck side, the four-year residual value for a Honda is 48.8 per cent.
But how the world has changed. First, the competition has been diligently learning a Honda playbook filled with caveats about building cars that don’t break, deliver a high degree of refinement and good fuel economy. The lessons have sunk in deeply, too.
South Korea’s Hyundai, for instance, is busy telling the world that its fleet-wide fuel economy in the United States is better than Honda’s. Hyundai also is not shy about touting the fact it has more Top Safety Picks from the U.S. Insurance Institute for Highway Safety than Honda. For its part, Ford officials will remind you that Ford has twice the number of Top Picks as Honda. And so it goes with other auto makers, too.
While Honda’s rivals have been beavering away at instilling their vehicles with traditional Honda basics, more than one auto analyst has suggested that Honda has grown a little lazy and self-satisfied and complacent.
“A lot of people have suggested that Honda is coasting,” said Aaron Bragman, a senior analyst with IHS Automotive, at the Detroit auto show. “Recently, they haven’t been the successful innovator they were once known for being.”
Added Ed Kim, director of industry analysis for consultant AutoPacific: “They need a hit. Honda no longer has the edge. In efficiency, technology and design, they are no longer the leader.”
Stinging rebukes and for many, fully justified. Consider the dollars and cents story. It’s telling and in business it’s really what matters, anyway. To move the metal off dealer lots, Honda Canada has been cutting prices, offering payment deals and sweetening offers with cash-back incentives such as the $1,500 that is juicing sales of the popular CR-V compact crossover SUV.
And on the Acura side? How does a $4,000 factory-to-dealer cash incentive sound on the MDX SUV? It’s there, as is $2,500 on the Acura RL luxury sedan.
Into this environment comes the 2012 Honda Civic. The Civic is arguably the heart and soul of Honda. It’s also been the best-selling car in Canada for 13 years running. Honda Canada intends to enjoy No. 14, too. That’s why this all-new, ninth-generation Civic is as much about the deal as it is about the engineering, design, comfort, reliability, safety and fuel-efficient performance.
The base 2012 Honda Civic DX, for instance, starts at $14,990 and comes equipped with a standard five-speed automatic transmission, versus $16,990 for the 2010 Civic DX with autobox. It’s a similar story right down the Civic lineup, including the sporty Si, which for 2012 is $890 cheaper than the less-powerful, less-well-equipped 2010 version.
In fact, Honda Canada officials such as senior product planner Matt Wilson argue that not only are prices down, but content across the board is up to the tune of thousands of dollars in value. Make no mistake, with the 2012 Civic that went on sale yesterday, Honda Canada is selling the deal as much as the latest engineering and design developments.
And why not? If that’s the story, Honda should tell it. You’ll be hearing even more of this sort of tale from Honda, too. All-new versions of the Pilot SUV and the CR-V are coming in the fall, says executive vice-president Jerry Chenkin.
“Eighty-per cent of our (sales) volume gets re-done this year,” he said at the preview drive of the 2012 Civic. Honda is remaking its lineup this year and the world is going to hear about every aspect from an increasingly pugnacious and thoroughly aggressive Honda.
As for the new Civic, it is exactly what you would expect from a proud and feisty car company that has been criticized for resting on its laurels and failing to deliver a true, ground-breaking hit in years and years.
The new compact is extraordinarily refined and comfortable. Civic fuel economy is up as much as 12 per cent, depending on the model, and the new Civic Hybrid is going to deliver 4.3 litres/100 km combined city/highway. The Civic Si’s horsepower is up to 201 and there has been a 22 per cent increase in torque, making it a very quick and responsive runabout. Even the Civic’s seats have a new design intended to reduce the chance of a whiplash-like neck injury in a rear-end collision.
Naturally, Honda expects to sell more Civics in 2011. Chenkin says sales of 63,000 should be attainable as long as supplies last. That may prove to be a problem, given that Honda has had to slash production in the wake of the earthquake and tsunami disaster in Japan.
If Honda Canada does hit 63,000, it will be a tidy improvement over the 57,505 Civics sold in 2010, but well off the 72,463 Civics Honda Canada sold in 2008.
More importantly, Honda is hopeful the new Civic will lure 17- to 34-year-old Generation Y buyers who buy compact cars, but not many brand-new Civics. The price reductions, says Chenkin, should expand the Civic’s appeal beyond its core baby boomer audience.
Consider: 44 per cent of new Civic buyers are boomers, while just 23 per cent come from Gen Y. In other words, the Civic lately has been the darling of greying customers heading for retirement and the horseshoe pit, not younger types just now moving into their peak earning years.
But a lot of Gen Y types will be startled to see Honda’s new approach to the deal and it will get their attention – along with flying pigs, striped leopards and a warm and fuzzy Harper.
Four on the showroom floor: For the first time, Honda is introducing four completely redesigned models almost simultaneously. The first of the new Civic sedans arrive in dealerships this month, following quickly by the Civic Coupe, Si Coupe and Civic Hybrid.
Safety: Aside from having Honda’s Advanced Compatibility Engineering (ACE) body structure to manage collision energy, all Civics come with side curtain airbags, driver and front passenger side airbags, Vehicle Stability Assist (VSA) anti-skid control and anti-lock braking.
New styling: Honda calls it “mono-form” design language and tout its clean, flowing lines
Space: this Civic has a roomier interior and Honda types say all models come with more convenience than any other vehicle in segment.
New technologies: depending on the model, new features include the intelligent Multi-Information Display (i-MID), USB Audio Interface, Bluetooth mobile phone connectivity and a satellite-linked navigation system with bilingual voice recognition
New powertrains: Honda is touting a re-engineered 1.8-litre four-cylinder engine (140 horsepower) with enhanced fuel economy and a larger and more powerful 2.4-litre four-cylinder (201 horsepower) for the Si, and a new Civic Hybrid powertrain (with Integrated Motor Assist and a 1.5-litre four-cylinder for 110 hp) “that delivers higher overall performance and improved fuel economy.”