Can The TLX Restore Acura's Car Business?

U.S. sales of passenger cars at the Acura brand are down 32% through the first eight months of 2014, yet total Acura brand volume is down just 3%, a loss of 3264 units. Acura’s trio of crossovers, including 66 sales from the cancelled ZDX, have improved 20%, a gain of more than 12,000 units, not quite enough to offset the car division’s 15,552 lost sales.

It’s a tough year on which to judge Acura’s car output. Acura is replacing the TL sedan, TSX sedan, and TSX wagon with a single model, the TLX sedan. The TLX operates in a broad and rather affordable price spectrum, with four and six-cylinder powerplants, front or all-wheel-drive, and eight or nine-speed transmissions.

But this year’s car sales decline at Acura is nothing new. Moreover, it stretches beyond the disappointing sales of the disappearing TL and TSX.

ILX sales are down 18%; RLX volume is down 5%. Acura car sales slid 10% in 2013 after a 19% increase in 2012, which followed 2011’s 8% loss, 2010’s 1% increase, and consecutive declines in 2006, 2007, 2008, and 2009. Acura sold 151,662 passenger cars in 2005, when the brand’s U.S. market share was 1.23%, but didn’t sell that many total vehicles in 2012. Acura car sales in 2013 were down 56% from 2005 levels; down 16% from 2008.

Is the TLX the answer? We only have one month’s results on which to base our interpretation of the market’s reaction to the new car, so interpret we shall not. However, after a bit of a wait for cars to arrive, the TLX’s August sales results (2286 units) were better than anything the TSX, wagon-inclusive, has achieved in the last 27 months.

Even if the TLX quickly outshines the TSX, historic TL numbers will be much harder to match. TL sales declined consistently on an annual basis in 2006, 2007, 2008, and 2009, perked up very slightly in 2010, then declined in 2011, perked up slightly again in 2012, and then plunged in 2013. The slide has been so long in forming that we forget how popular a car it was. 78,218 TLs were sold in 2005; less than a third that many last year. Combined, Acura sold 113,074 TLs and TSXs in 2005. We’re not about to see the TLX make a return to those heights for Acura.

The RLX is far less popular than the RL was nine years ago, as well. Acura may sell 3800 this year. 17,572 RLs were sold in 2005, which preceded seven consecutive years of decline.

The RSX contributed an average of 19,915 annual sales in its three final full years: 2004, 2005, and 2006.

With help from those two lower-volume models, cars generated 70% of Acura’s U.S. volume in 2004, 72% in 2005, and 69% in 2006. Cars accounted for 41% of Acura’s U.S. sales in 2013, just 31% so far this year.

Acura is very much a crossover brand now. Acura sold 98,151 MDXs, RDXs, and ZDXs last year, the kind of total Acura hasn’t achieved with its cars in seven years. Compared with 2005, when the MDX was alone in Acura’s utility vehicle stable, Acura crossover sales in 2013 were 69% higher. Acura has already sold 73,375 MDXs, RDXs, and ZDXs in 2014, more than the total achieved by the brand’s crossover lineup in all of 2007, 2008, 2009, 2010, or 2011.

These aren’t just popular vehicles in comparison with Acura’s increasingly unpopular cars. The MDX outsells all premium brand SUVs and crossovers save for the Lexus RX. Sales of the RDX are down 2% in 2014, but it’s still outselling the Audi Q5, Mercedes-Benz GLK, BMW X3, and Volvo XC60. And it’s not as though all premium automakers (or premium wannabes) aren’t increasingly reliant on utility vehicles. BMW, for example, didn’t produce any SAVs in 1998, but in 2014 more than one-third of the brand’s U.S. sales involve an X1, X3, X4, X5, or X6.

Yet Acura’s steady rise in the SUV/CUV segment has not proved strong enough to maintain Acura’s position in the overall market. Acura’s market share in America was as high as 1.23% in 2005 and 1.15% in 2010, but Acura market share is down to 0.95% this year.

On its own, the TLX won’t replicate what the TL and TSX managed a decade ago. If the TLX can simply stop Acura from becoming an SUV-only brand, Honda’s crossover-centric answer to Land Rover or Jeep, we’ll say it achieved something meaningful, though perhaps not voluminous.