Honda’s deliberate path drives sales growth

After years of top rankings, Toyota’s position in the widely followed Consumer Reports Annual Car Reliability Survey has slipped. Last year Consumer Reports said it will no longer automatically recommend new Toyota models as it ranked the automaker third behind Subaru and Honda in its study of almost 1.3 million consumers’ complaints about their vehicles. Another recent J.D. Power Initial Quality Study showed Toyota losing ground to Honda.

“The interesting thing about Honda vs. Toyota is [Honda has] fewer products that sell much better — it’s really hard to find a dog in their lineup,” said Tom Appel, editor of Consumer Guide Automotive, which offers buying advice to car shoppers. His publication recommends the Accord sedan, the Pilot SUV and the Civic compact as top picks.

“It’s interesting that when you look at Toyota they keep launching products, but some of them are not that popular — the FJ Cruiser, for example, and they had to throw lot of money on the hood of the Tundra truck,” he said.

As Toyota stretches itself to become a full-line automaker, Honda has pursued a more conservative strategy, avoiding trucks, for example, said Bragman.

“Honda is very conservative not only in the technology it employs in vehicle designs, but also in its manufacturing,” he said. “There are only a few only a few configurations of vehicles, so they’re able to manufacture these things easily. They have serious controls in their systems; it gives them serious flexibility.”

Still, Honda plans to expand its offerings in the fast-growing alternative-fuel market. The automaker plans to expand its hybrid vehicle lineup over the next three years, including a model priced below the Civic hybrid, and plans to introduce its i-DTEC clean diesel engine in the North American market in 2009. The engine cuts harmful exhaust emissions while boosting power and fuel efficiency and is expected to meet regulations in all 50 states, unlike diesel offerings from Mercedes and BMW.

And at last fall’s Los Angeles auto show Honda unveiled its new FCX Clarity, a sedan powered by a hydrogen fuel cell that Honda plans to begin leasing to a limited number of Southern California drivers this summer — the first fuel-cell car to be offered to the general public.

For now, Honda is set on competing for business in the extremely popular crossover SUV market with the next-generation Pilot, which will hit showrooms this spring. Although exact details were not released, Honda says the new, eight-passenger vehicle has a redesigned crossover SUV platform, improved fuel efficiency through fuel-saving cylinder management technology and extra legroom.

The current, boxy version of the Pilot, which made its debut in June 2002, is serious need of a redesign, said Bragman. New, popular crossovers like the GMC Acadia and the Buick Enclave have more curved rooflines to increase aerodynamics and raise gas mileage. Sales of the Honda Pilot fell 23 percent last year as the GM’s new Acadia and Enclave took away share.

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