Dream On, Honda

Honda came within touching distance of premium status only to let it slip through their fingers. What happened?

Even its own mother would disown it – the 2015 Civic

Honda Europe has made a profit just once since 2007, when sales in the region peaked at 313,400 cars. In 2013 sales collapsed to a mere 139,700 cars. What on earth is going on at Japan’s number three motor manufacturer?

During the latter years of the 1980’s Honda appeared poised to make a significant breakthrough in the European market. Perhaps the most engineering-led of mainstream Japanese manufacturers, Honda achieved what its better selling rivals had hitherto failed to manage – credibility. A great deal of this came on the back of their involvement in Formula One – Honda’s engines powering to five World Driver’s Championships. Further evidence lay in the development of the technically advanced and critically acclaimed NSX two-seater, one of a handful of Japanese cars to achieve true and lasting greatness.

Exquisite engineering – the NSX

Honda’s mainstream saloons and hatchbacks were stylistically appealing, densely engineered and in a first for a Japanese marque, genuinely desirable. The mid-80’s Accord – available in saloon and breadvan-style Aerodeck versions were fast, refined and drove beautifully. Palpably better than most of their putative German rivals in most of the areas that mattered. Further down the range, contemporary Civic models were an endearingly leftfield choice and could be had in a bewildering range of body styles, including the delectable CRX coupé. Engineering advances like variable valve timing, and four wheel steering were rolled out on the kind of production cars people could actually buy. By the late 1980’s, Honda had in many ways, become something of an Asian (pre-Fiat) Lancia, offering top-notch engineering and distinctive style at a vaguely affordable price.

Honda’s engines were also something of legend. With a revered heritage in motorcycles, their power units combined high specific outputs, smooth running and technical novelty – coupled with a metronomic reliability. They also gained Honda a motorsport pedigree that rivals would have killed for.

Accord Aerodeck

For a time, Honda looked like joining the ranks of the upper echelon – up with Audi and BMW as upmarket, upwardly mobile chariots of the well-heeled. In fact, Car Magazine featured an Accord on their December 1986 cover, proclaiming a coming Japanese Tsunami. The following decade saw Honda consolidate its position as the engineer’s choice, but somehow the breakthrough never materialised. Somewhere along the way Honda stopped making interesting, technically dense cars; opting instead to chase dreams of serious volume, most particularly in the US car market.

Despite opening a production facility in the UK, Honda’s European ambitions hitherto took a distant second to their efforts to conquer America. Perhaps it was the so called ‘gentleman’s agreement’ coupled with the protectionism of the dominant car producing European states that prompted Honda’s focus Stateside. But equally, Honda lost its mass-appeal – selling mostly to older, more conservative customers.

Recent announcements of job cuts at their Swindon plant and the fact that they will not replace the slow-selling Accord saloon demonstrate the serious trouble they now face. Furthermore, the mainstay Civic has foundered, a mere 38,000 finding buyers across Europe in 2013. Civic sales have slipped 8% again in the year to autumn, while domestic rivals, Mazda have seen an upswing of 131% for their more appealing 3 model. However, these figures pale next to the untouchable Golf, with sales of almost 400,000 units within the same period.

Not long for this world – the current Euro-Accord

Honda’s current styling is geared to appeal to a more youthful audience – (as every manufacturer is doing) – but appears to only have alienated their traditional customer base while failing to gain new buyers. Certainly, the current Civic is a bit of a visual migraine, with little to otherwise commend it over competing products from the Euro-mainstream. Automotive Industry Data Editor, Peter Schmidt recently told Forbes; ‘Honda’s problems are all of its own making…they’ve got the wrong styling and the wrong prices’. Unsurprisingly, Honda themselves view things differently, a spokesman telling Automotive News in December; ‘We’ve been waiting a few years for new product and now it’s coming,’ He added that Honda is now in a stronger financial position, adding; ‘I believe we are now a lean organization that can move forward. Profitability will come along with that.’

If we are to believe the drip feed, Honda has awoken from its slumber and is once again interested in producing cars to interest Europeans. But apart from ADHD versions of the Civic there’s not much substance to the claims. There is a new mid-engined NSX in the offing and a promise of the futuristic FCV hydrogen fuel cell model down the pipeline suggesting Honda is getting back to truly innovative form. However, most of their promised volume is expected to come from – you guessed it – crossovers. IHS Automotive forecasting Honda to sell around 30,000 units of the newly announced HR-V across Europe this year.

The question for Honda is whether a new generation of industry-generic crossovers can appeal to European buyers who are far more likely to buy something made by the more established players. Having lost the chance to reposition itself at the upper tier, and apparently having no stomach to try to bring the Acura brand across the Atlantic, Honda are now faced with a dilemma. Try another stab as a mass-market player or accept a smaller chunk of the pie and push performance and fuel cell technologies touting the Honda brand as the forward-thinker’s choice. Both come with risks, but having left the European market to its rivals, it seems a little late trying to reverse tack now.

The future?

Honda’s recent advertising spoke about of ‘The Power of Dreams’. A nice concept and some clever creative, but they will have to dream up something a lot more convincing if they seriously believe they can now recover the ground they’ve lost.

Sources/data/quotes: Forbes/Automotive News/IHS Automotive/Sands Museum/Left-Lane

Author: Eóin Doyle

Co-Founder. Editor. Content Provider.

16 thoughts on “Dream On, Honda”

  1. Winding back to the late 80s you’d imagine Honda was going to be the BMW of Japan. I read a review of the Legend coupe from 87 and it was a deeply impressive car. “Car” thought it close to Mercedes in quality.
    The image that Honda acquired of being for old people is infuriating, as ungrounded as Opel being stodgy. These ideas are bad memes that have stuck in the minds of critics. What Honda shows is the feeble relationship between firms’ intentions and outcomes. No matter what designers and marketing strategists wish, the cars’ fate seems determined to unfold another way; put another way, if the public likes a car I doubt the planners’ plans had much to do with it. The Accord is a fine looking car and almost certainly a pleasing drive. Its lack of success is out of all proportion to its demerits (if there are any really).
    Airbag issues?

  2. Hard for me to tell what’s wrong with Honda as I don’t quite recall seeing very many in my childhood, so I can’t quite make a mental picture of the average buyer.

    Today I quite like the current Civic (I actually think that the proportions, if not the detailing, are much better than on the previous, much-loved iteration, and an estate is also on offer), and the C-RV, which seems to have replaced Volvo wagons as the vehicle of choice for the Surrey gentry.

    That new H-RV on the other hand looks terrible on pictures.

  3. It’s the current Civic that troubles me the most. I can’t count the ways. The rest of the range is good solid stuff, especially the unloved Accord. It’s really neat and crisp. The question is, how would it rate against Opel’s Insignia?

  4. Honda has never enjoyed much of a foothold in Europe and their Eurocentric cars betray that lack of confidence. It is notable that their best year of sales coincided with the 2006 “spaceship” Civic coming on stream, a startlingly designed statement car that stood out in a segment known for conformity. Sadly the 2006 Civic is the exception that proves the rule; no post millennium Honda Europe product has been so bold or so successful. Indeed, the 2011 Civic was a comically bad update, with tragic styling and obvious decontenting. The interesting CRZ, an underperformer in every sense with a dismal hybrid power train, was killed too quickly before the performance version that everyone was hoping for could appear. And now the Euro Accord, a mere shadow of its North American market cousin, faces the axe. If it were not for the handsome and popular CRV, Honda Swindon would have nothing to build at all.

    1. What was so dismal about the CRZ powertrain? Apart from its lack of torque, I seem to remember it being praised by Ben Whitworth at TWBCM.

    2. I think people were hoping for a good old fashioned hot hatch from the CRZ; a high revving four banger allied to decent handling, in the mould of the CRX. Instead Honda put all their money into the hybrid power train and gave it shock absorbers filled with lead. That said, I do think the CRZ will gain a cult following in years to come.

    3. Exactly my point – the fact that people wanted something else doesn’t make the hybrid powertrain bad per se, and maybe if Honda had also installed it in anything other than a niche model, potential buyers would have quickly warmed up to it. Another missed opportunity in my opinion.

    4. I believe I may have been thinking about the power train from the Honda Insight with its droning CVT. Irrespective, the CRZ had the right drive train for the wrong car.

  5. The current Civic is by far one of Honda’s lowest points to date. Such a horrible update to what was a very sharp, very avant garde looking car (the previous Civic), that didn’t date as fast (or at all) as I had feared it would, when it came out.

    Honda used to make good middle of the road “just above appliance status” cars. Slightly posh in other words. But these days they still charge the “slightly posh” prices but really none of their cars have that timeless elegance that such a niche requires.

    1. Good point about the previous Civic ageing well. That said, I don’t agree with vitriolic comments on the current one. I think people focus too much on styling and detailing i.e. things that could easily be changed with a drastic facelift, like the protruding rear lights or even the slightly OTT wing treatment. I personally think the overall design and proportions are actually correct and there’s nothing intrinsically bad about the car.

    2. A simple fix, sure, but one that seems to elude Honda. The recently announced Black Edition appears a tacit admission of their failure in this regard.

  6. At their best Honda often offered a tasteful classless classiness. Sometimes they served up this with a sportiness and a commendible regard for engineering. The current Accord has these flavours (which might explain its lack of appeal). The current Civic gets lashings of vitriol because it’s disappointing, like the ugly sister of its predecessor. Honda suffers from being positioned in a non-natural market sector, like Volvo, Subaru and Saab: a bit pricey, a bit sporty but not really premium and not sporty enough. People ought to be able to handle such ambiguity but obviously aren’t. Such success as they have is on a per-model basis.

    1. This reads almost like something you wrote before about Peugeot…

  7. Hi: that’s true, the similarity is there, isn’t it? Peugeot used to sell quite nice, refined cars and so did/does Honda. It would appear that firms need a clear charcter and cars that are consistent with that.

    1. Indeed, and there’s a clear lack of confidence in their current styling. Nothing that can’t be sorted fairly quickly though, with the right kind of impetus.

  8. Historically, both Honda and Subaru had images as being engineering led. This suggested that they were above mere marketing, giving you cars you should have, rather than what some glib marketeer might persuade you that you wanted. A nice idea but, in Subaru’s case they drove themselves into a WRX shaped niche surrounded by uncomfortable looking blobs. And super engineers Honda were soundly beaten by cynical old Toyota in the hybrid stakes and picked up a reputation for pensioner specials along the way. Neither company seems to have a coherent strategy which is a pity, because they have both retained a reputation for integrity and could build some really great cars, if only they focussed. Is this a result of the Japanese industry where, commendably in principle, individuals don’t get to dictate things, something Honda have historical justification to be wary of ever since Soichiro Honda’s ill fated 1300?

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