By on June 11, 2012

Even though 85 percent of Hondas sold in North American are built on the continent, the strong yen is hurting the company’s Japanese exports to the point where Honda is losing money on them.

Imports from Japan include the Acura TSX, the CR-Z and Insight Hybrids, some versions of the CR-V and the Fit subcompact. Honda CFO Fumihiko Ike told Automotive News that the Fit makes no profit when exported to the United States, but Honda feels that it’s an important car for dealers to sell and as a means of luring and retaining younger customers.

Honda, like other manufacturers, is planning on shifting even more production to North America. The Acura ILX is being built in Indiana rather than the planned Japanese site. The ILX Hybrid is the only hybrid product built by Honda in North America, as Honda is far from the 100,000 units per year needed to make North American production worthwhile by roughly 69,000 units.

Rival automakers like Nissan and Toyota still build 70 percent of their vehicles in North America, and are scrambling to catch up to Honda’s figure. But for dealers, developments like Mexican production of the Fit can’t come soon enough, especially with government incentives for small, fuel-efficient cars in Japan boosting demand for the Fit, further straining stateside allocation.

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10 Comments on “Unprofitable Imports Alter Honda Product Plans...”


  • avatar
    stuntmonkey

    I see a lot of newer LX and EX spec Civics going to younger families. At the price overlap, unless you are dead set on having one, you just get more car (and the same or better mileage) with the Civic. It’s like Honda de-contented the Civic to keep it’s price down knowing that it was going to run dry on Fits. Hyundai still has the benefit of currency exchange, and Ford doesn’t have the same problem with the Fiesta, allowing the Focus to go upmarket. Mazda is suffering across the board and can’t address the exchange problem by simply re-aligning it’s product platform?

    I suppose this also kills any chance of the rather interesting Fit Shuttle making it here.

  • avatar
    Olyar15

    How is the Civic “more car” than the Fit? When I bought my Fit, the Civic wasnt even an option. To me, the Fit was “more car” simply because of its versatility in cargo size. I would gladly pay more for a Fit than a civic.

  • avatar
    grzydj

    The Fit is an important car to the US market because it’s the only good car that Honda currently makes.

    • 0 avatar
      28-cars-later

      I would say the Fit is the most ‘Honda’ of their current offerings in the sense its closer to what they have been traditionally known for in terms of size and weight.

      • 0 avatar
        grzydj

        @28

        Which is probably why it is the only car in their lineup that I appreciate. I know they have a Civic SI right now, but I’d love to see a Fit SI as well, or instead.

        I suppose that’s what the much maligned CR-Z was supposed to be.

      • 0 avatar
        28-cars-later

        Agreed. Fit SI would be kinda cool, would be a nice way to recap some of the Yen/Dollar costs since you could offer a higher price point for not much more engineering.

    • 0 avatar
      mies

      My wife has one and it’s a decent car. The Sport version is probably the best looking car Honda has right now. My only complaint is the engine’s lack of torque and the rear drum brakes. Other than that, it’s nice little car with plenty of space and amenities.

  • avatar

    Hoda should take a page from what Fiat is planning on doing and just import the car from Brazil into Mexico and then America. Doubt it couldn’t turn a profit on that.

  • avatar
    ciddyguy

    I’ve loved Honda in the past, but my immediate thought was upon reading this was so what? I’d be after the Fit too if I were to buy a Honda, but I find the Fit not sporty enough, especially with the autobox, never mind its versatile hatchback design.

    but upon further reading, I put that thought aside.

    I think I may be a bit too harsh on Honda, then again, I did just come off a day trip road trip over the weekend in my Mazda Protege5 and even though I was mostly traipsing up and down I-5, it was a joy to drive.

  • avatar
    dwight

    Make a civic wagon/hatch in North America at a decent price and suddenly the civic has new customers. It’s working for Ford and Mazda. The civic is already just as fuel efficient as the Fit. Bring it on.


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