Honda attributes March poor sales to quake-related inventory shortages

Article by Anita Panait, on April 10, 2012

A year after the earthquake and tsunami that hit Japan in March 2011, Honda’s top executives continue to point to the impact of last year’s disasters for its poor sales performance in March 2012.  The disasters resulted to constrained components supplies and restricted inventories, which caused many Japan-based car manufacturers to lose a fair share of the market to other automakers.

But while other Japanese firms recover, it seems the disasters still hound American Honda as the company’s sales dipped 5% for April, in contrast to the overall market’s 13% rise. American Honda was calmly outperformed by Nissan North America, Chrysler Group and even the Hyundai-Kia Automotive group.

Honda Division dropped 4 percent and was overtaken by Nissan Division. Honda’s Acura brand, meanwhile, saw its sales drop 12 percent; though barely topping Infiniti, it was outclassed by Buick and Audi.

Honda’s executives denied that cooling of public sentiment is its main reason for its dismal performance, blaming instead the lack of supply of new vehicles. Tetsuo Iwamura, the chief executive of American Honda, gave assurances that the supply situation will be rectified by the end of this month.

According to Iwamura, the company and its suppliers’ comeback performance have been slower than Toyota Motor Corp.  Toyota suffered the same fate as Honda in last year’s disasters, but was able to recover sufficiently, as its unit, Toyota Motor Sales U.S.A., posted a 15 percent rise in March.

As for the Accord, Iwamura described the brand’s March performance as "not satisfactory," selling only 26,771 sedans and dropping to eighth among the best-selling passenger cars. The Accord is scheduled for a redesigned this fall, and the development months could mean lower sales figures.

Fuel-efficient Civic and Fit models also had miserable sales in March, with the former dropping 10% and the latter slipping 35%. Another model, the Insight, dived 63 percent for March.  Iwamura remarked that another cause for shortage in US supplies was the strong demand for Civic Hybrid, Fit and Insight in Japan.

Topics: honda, sales

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