Editorial: Acura Needs Another Crossover
Everyone is eager to read Acura its Last Rites, but in the United States, it managed to outsell Audi last year. Despite having little to offer enthusiasts and traditional fans of the brand, the RDX and MDX are unqualified successes: the RDX outsells all of the small crossovers from Germany’s luxury bands (Audi Q5, Mercedes-Benz GLK etc.) with the larger MDX outsold only by the Lexus RX and Cadillac SRX respectively. As much as Acura touts the NSX as the future of the brand, what they could really stand to use is another crossover, one that slots below the RDX.
Acura’s sales have been a roller coaster over the past decade. 2006 saw the beginning of a steep decline in sales, with Acura losing nearly half of its volume by 2009, going from 201,000 units annually to just over 105,000 in three years. In the throes of the financial crisis, Acura canned expensive projects like a front-engined, V10 NSX, a planned V8 and rear-drive platforms. There was even talk of shuttering the brand altogether.
Evidently, that didn’t happen, and the brand managed to claw its way back. Last year, it sold 165,000 units, with the RDX and MDX accounting for 59 percent of the brand’s total volume. People are coming to Acura for the crossovers, not for the cars, though that picture should improve now that the RLX has replaced the RL and the moribund TL is on its way out.
That doesn’t change the situation, as much as the Integra GS-R worshiping faithful may not like it. Crossovers are a growing segment, and perhaps the only bright spot in a globally depressed auto market. Even in Europe, the spiritual home of the station wagon, crossovers are practically the only segment that is not shrinking. Acura itself is not a global brand, but the key markets in competes in – North America, China and Russia – are crossover crazy, especially the latter two, where poor roads dictate a higher ride height, and a high driving position and faux-SUV proportions are all desirable traits.
In America, CUVs are already eating into segments like mid-size and large sedans, while small crossovers like the Honda CR-V and Ford Escape are among the most popular light trucks. At the same time, premium small cars like the Mercedes-Benz CLA are gaining conquest sales from mainstream nameplates like the Honda Accord. It would be foolish to assume that the upcoming Mercedes-Benz GLA won’t do the same with the CR-V, Escape and other larger, but comparably priced mainstream vehicles.
Acura is said to be working on a GLA-sized vehicle for the Chinese market, based on the Honda Vezel. From a business standpoint, they’d be foolish not to bring it here. It’s hard to imagine it would fare worse than the awkwardly proportioned ILX, which hasn’t been accepted by the market place, and will likely get its lunch eaten by the CLA.
When it comes to passenger cars, the European nameplates have Acura beaten lock, stock and barrel. But the crossover space is a different story, and it’s only going to grow further and further. A competitor to the GLA, the BMW X1 and an Audi Q3 could be a way for Acura to turn the ship around, adding volume for the brand while maximizing profit for the Fit/Vezel platform and preventing the European brands from owning that corner of the market.
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- Keith Maybe my market's different. but 4.5k whack. Plus mods like his are just donations for the next owner. I'd consider driving it as a fun but practical yet disposable work/airport car if it was priced right. Some VAG's (yep, even Audis) are capable, long lasting reliable cars despite what the haters preach. I can't lie I've done the same as this guy: I had a decently clean 4 Runner V8 with about the same miles- I put it up for sale around the same price as the lower mile examples. I heard crickets chirp until I dropped the price. Folks just don't want NYC cab miles.
- Max So GM will be making TESLAS in the future. YEA They really shouldn’t be taking cues from Elon musk. Tesla is just about to be over.
- Malcolm It's not that commenters attack Tesla, musk has brought it on the company. The delivery of the first semi was half loaded in 70 degree weather hauling potato chips for frito lay. No company underutilizes their loads like this. Musk shouted at the world "look at us". Freightliners e-cascads has been delivering loads for 6-8 months before Tesla delivered one semi. What commenters are asking "What's the actual usable range when in say Leadville when its blowing snow and -20F outside with a full trailer?
- Funky D I despise Google for a whole host of reasons. So why on earth would I willing spend a large amount of $ on a car that will force Google spyware on me.The only connectivity to the world I will put up with is through my phone, which at least gives me the option of turning it off or disconnecting it from the car should I choose to.No CarPlay, no sale.
- William I think it's important to understand the factors that made GM as big as it once was and would like to be today. Let's roll back to 1965, or even before that. GM was the biggest of the Big Three. It's main competition was Ford and Chrysler, as well as it's own 5 brands competing with themselves. The import competition was all but non existent. Volkswagen was the most popular imported cars at the time. So GM had its successful 5 brands, and very little competition compared to today's market. GM was big, huge in fact. It was diversified into many other lines of business, from trains to information data processing (EDS). Again GM was huge. But being huge didn't make it better. There are many examples of GM not building the best cars they could, it's no surprise that they were building cars to maximize their profits, not to be the best built cars on the road, the closest brand to achieve that status was Cadillac. Anyone who owned a Cadillac knew it could have been a much higher level of quality than it was. It had a higher level of engineering and design features compared to it's competition. But as my Godfather used to say "how good is good?" Being as good as your competitors, isn't being as good as you could be. So, today GM does not hold 50% of the automotive market as it once did, and because of a multitude of reasons it never will again. No matter how much it improves it's quality, market value and dealer network, based on competition alone it can't have a 50% market share again. It has only 3 of its original 5 brands, and there are too many strong competitors taking pieces of the market share. So that says it's playing in a different game, therfore there's a whole new normal to use as a baseline than before. GM has to continue downsizing to fit into today's market. It can still be big, but in a different game and scale. The new normal will never be the same scale it once was as compared to the now "worlds" automotive industry. Just like how the US railroad industry had to reinvent its self to meet the changing transportation industry, and IBM has had to reinvent its self to play in the ever changing Information Technology industry it finds it's self in. IBM was once the industry leader, now it has to scale it's self down to remain in the industry it created. GM is in the same place that the railroads, IBM and other big companies like AT&T and Standard Oil have found themselves in. It seems like being the industry leader is always followed by having to reinvent it's self to just remain viable. It's part of the business cycle. GM, it's time you accept your fate, not dead, but not huge either.
I will admit it, I grew up a Honda/Acura fanboi. I always loved their products until they lost their way. I was the first one to deride the company as they started cutting out the sportiness and changed naming, cheapened the product, etc. But now I am older, and I am done dredging up all the old cliches about using real names and offering wagons and hatchbacks, etc. But after car shopping with a couple relatives recently, I fail to see why everyone hates on Acura and Honda so much. I thought the ILX was a terrible idea, until I actually checked one out. Its a Civic Si for grownups. What's the problem? The Civic Si is still available too for those who want more sport and less maturity. It has the 2.4L/6sp from the TSX. You know, the one that everyone who loved the RSX wishes they had put in the RSX in the first place. Well now you can have it without an engine swap. Apparently there are still plenty of Honda tuners available to mod the engine just like before. Whats not to like? The RDX is basically a more stylish CRV with a big V6. Once again, what's wrong with that?? The CRV is extremely practical, has legendary reliability, and insane resale value. The RDX is better looking, nicer inside, and has like 100hp more. What exactly is so wrong with either one? The TLX looks great, an actual improvement over the outgoing TL, and better looking than the most recent TSX too. It ticks every box that a typical almost-luxury buyer wants. The newest Accord is a great car that even comes as a low-priced 4cyl stick shift Sport model to satisfy the now grown up fanbois... under $25k. Wow yeah that's terrible of them. The MDX finally isn't ugly anymore. The Pilot? Well its still ugly but not any uglier than the competition. The Fit is a great looking and practical little car and its cheap too. Even the much-hated CRZ... good looking car, gets pretty good mileage and is pretty fun to drive, can be had with a stick, not too pricey... essentially exactly what the CRX was, and everyone hates it. "They didn't put the Civic Si engine in it!!" "Its so slow!!" "It doesn't get MPG like a Prius!!" Geesh people are never happy. If you want the HP or a back seat then buy the Civic Si coupe, if you want mileage get a Prius. But if you want a return of the CRX Si, then buy a CRZ and get the Jackson Racing supercharger kit for it. And to me the best part is that for the most part the entire Honda/Acura lineup is dead solid reliable and has extremely high resale value. You can drive them for 10 yrs and still get good money for it. 20 yrs and they are still good cars. That's what sells the cars, not the tech or the gadgets or even which wheels are driven. Sure Lexus is just as good but more expensive. Toyota is just as good too, but not dramatically better or worse in any category (except the hybrids, they nailed that one). What other brands have that good of a reputation? Sure, I'd love a 4-dr Civic hatchback, not even sure they make one though. And I'd probably never buy it new anyways. And I miss the S2000 too, but I'd probably not buy a new one either. And the NSX was amazing, but I couldn't afford one then and it isn't like you can't find a dozen or so for sale at any given moment, they are just too expensive. They don't make any muscle cars or RWD cars but aside from the sports cars they never did so how can I fault them for that? I just dont see how their lineup today is any different from what they have always offered.
They need another crossover to either slot above the MDX or below it, depending on whether they want to go upmarket or not. It's 193 inches. The GL is 200. The QX80 is 208. Acura needs to cater to American tastes and preferences if they want to succeed. They can't just follow in BMW or Infiniti's footsteps just because "that's how a luxury car brand should be." Many Americans simply don't like small, sporty cars, and even though people might SAY they want a European experience that's reliable, which Acura/Lexus/Infiniti tries to deliver, they MAY actually want something different. It's like how people will say they like dark roasts for its flavor, but overwhelmingly prefer lighter roasts because it's less bitter. Or how everyone declares they love authentic Italian food and pasta, so most companies tried to make their sauce as authentic as possible by mimicking recipes from Italy to create the "perfect sauce." It turns out Americans in taste tests like really chunky spaghetti sauce, not the very runny authentic kind. Yet they'll still make fun of people eating at Olive Garden because it's so "Americanized." Acura, build another crossover to slot below or above the MDX. Go after what people ACTUALLY want, not what enlightened contrarian enthusiasts want. You don't have to abandon your core customers by making all of your products big and luxurious. You can have different products target different markets. It won't make you seem inconsistent, I promise you. And for god sakes, upgrade your interior materials just a little bit? Real wood is a start, as is having a separate team design Acura interiors and Honda ones. The Accord Touring, the Odyssey Touring Elite both make Acuras seem not as remarkable or special on the inside. I step into a E350, it looks really nice and dramatic. I step into an RLX and I see slightly more elegant Accord Touring. As a young Japanese luxury division, Acura's got two things against them: ostentatious displays of wealth are taboo and stigmatized in Western society. There's a reason why the Toyota Land Cruiser is just, if not more popular, than the LX570, and why every Escalade post on Autoblog has some know-it-all commentator saying, "Truly wealthy people have Yukon Denalis. These Escalades are for strip club owners." Secondly, Acura doesn't have the cache and the cultural prowess to influence what people want just by introducing a product like BMW, Mercedes, or Porsche. I think this is why the ZDX bombed. And no, simply increasing prices to make it an aspirational good and to appeal to emotions (as Acura tried to do when pricing the RLX) won't work unless you've got the product and the demand to justify those prices! A few aluminum body panels here and there and a complex AWD systems are nice (less impressive since the F-150 is going aluminum), but they don't fundamentally change the product so you can charge an extra $15k over a Honda and have tacky commercials that show tall guys in Brioni suits and nice watches try to convince me Acura is a lifestyle brand. Acura chose to have new models be very distinctive looking in 2008, citing that in 2005-2006, people were getting so wealthy they wanted ways to distinguish themselves from the poor. It sucks everything went in the pooper with the financial crash, but even if it didn't, I'm not sure this move would have been successful. http://www.amazon.com/Distinction-Social-Critique-Judgement-Taste/dp/0674212770 I recommend they re-read this book. I think they're on the right track with their Jewel Eye LED's and the tasteful design language. My idea boils down to two things: 1. Chase after what people ACTUALLY want (crossovers and POWER), not what they say they want. Chasing after what the European luxury divisions are doing is a waste of time. The Koreans are doing a better job at copying them, so you'd be competing with even MORE car companies. 2. If you're going to be a luxury division, be more distinguished or more luxurious than your very upmarket, just-as-powerful, technologically advanced, luxurious, LED and radar cruise control-equipped Accord Tourings. And when I say distinguished, I mean get a V8 or turbocharger or something in there. I don't care if it's against your "philosophy." Are you there to espouse a philosophy and change the tastes of the American public, or are you there to sell a ton of cars with super high profit margins? I've got zero expertise in engineering, government regulation, marketing, sales, or research and development so feel free to disregard this as an Adderall-fueled rambling by someone who used to be in the market and frequently talks to 24 year old DINKs at Google and Genentech, mid-career professionals, and who have you.