As Expected, August 2010 Auto Sales Sink

All throughout the month of August, reports that the month’s auto sales would plunge surfaced time and again. This reporting was wholly unnecessary or at least overdone as an obvious factor was kicking in: August 2009 was “Cash For Clunkers” time, therefore any comparison with last year would be skewed by that federal government rebate program.

But, comparing month over month figures is how the industry rises and falls even when the numbers are skewed. One of the first to issue their sales report was Volkswagen who cut to the chase in the title of their news release: year to date sales are up by 21 percent. On closer scrutiny, Volkswagen revealed that monthly sales fell by 7.9 percent over August 2009.

Monthly Losers

Nissan went straight to the point with their news: sales fell 27 percent for the month although year to date sales are still up by 14 percent. Honda sales fell by 30 percent, but the Japanese automaker says that it is still ahead of last year’s pace though that lead narrowed to just 1.5 percent.

Toyota sales dropped by 31 percent which means that the world’s largest automaker has fallen behind last year’s year-to-date pace by 6,000 units. Blame all the recalls and bad publicity with having a net drain on Toyota whose position as the world’s largest automaker is in jeopardy regardless. Volkswagen, perhaps even GM, may unseat Toyota this year.

Fab 3

How did 2009′s winners do in August? That would be Subaru, Hyundai and Kia, the only automakers who saw their sales rise in a very depressed market.

Subaru’s sales fell by 22 percent, but they’re still up by 20 percent for the year. Hyundai reported that its sales fell by 11 percent, yet the Korean automaker is still up by 17 percent for the year and on pace to establish yet another sales record. Kia, Hyundai’s cousin, registered a 20 percent decline for the month, but they’re still up by nearly 10 percent year to date.

Detroit 3

The Detroit 3 reported mixed sales results with Chrysler sales increasing by 7 percent for the month and are now up by 10 percent for the year. Chrysler’s rise wasn’t a surprise as it basically had to sit out of  last year’s incentive programs as it recovered from bankruptcy and sought to restart production.

GM sales fell by 11 percent for its four surviving brands though the largest domestic automaker is still up by 5.4 percent for the year. Ford sales also fell by 11 percent, but the automaker is still up 18 percent for the year.

The Rest

Daimler reported sales up by 7.4 percent for the month, though when breaking things out by brand Mercedes was up 10 percent while Smart fell by 72 percent. Mercedes is capitalizing on Lexus’ woes and may regain the top luxury marque spot from its Japanese nemesis this year.

The BMW Group fell by 1.6 percent but is up 5.6 percent for the year. Mazda fell by nearly 26 percent, but they’re up by 7 percent year to date. Other manufacturers were still tabulating their figures when Auto Trends went to press with this article.

The Meaning

What does August 2010′s sales mean? Not a whole lot. Cash for Clunkers was a hard month to go up against, so a significant drop was expected. Going forward, a stale economy may keep sales down for the rest of the year, underscoring that the battered American consumer will be careful when and if they buy a car this year.

Sources: Automaker News Releases

Rumored: No Honda Diesel. We’re Bummed.

Last week, Autoblog relayed the news that Honda’s diesel engine plans were dead. That isn’t too surprising given how long the supposed roll out was delayed.

In November 2007, I published an article titled, “Your 52 MPG Accord Is On Its Way,” believing that Honda was ready to follow through on its plans to offer this vehicle to American drivers. Turns out I had the right idea, but Honda’s plans have since changed or at least have been clarified.

New Plans

Apparently, Honda has reversed course in two areas: the automaker won’t support diesel technology in North America and Honda now believes that hybrid technology can and should be expanded to larger vehicles. And, I’m not saying anything about the Honda’s hydrogen plans which I believe will start coming to fruition around 2015. I test drove the Honda FCX Clarity in November 2008 at the Los Angeles Auto Show.

I won’t rehash what Autoblog shared, limited information that it is, but I can tell you that Honda desperately needs to prove itself in two areas when it comes to vehicle hybridization: the looks of their vehicles and the effectiveness of their hybrid systems. Motor Trend, by the way, thinks the Toyota Prius and Chevy Volt are ugly too.

Ugly Designs

As it stands right now, the Honda Insight is just plain ugly while the hybrid Civic is acceptable. Efficiency wise, the Insight is on par with the larger Ford Fusion but trails the Toyota Prius badly. This after Honda beat Toyota to the North American market with its own hybrid more than a decade ago.

What Honda is looking to do is to improve its current hybrid system and expand it to larger applications. Right now, only partial hybrids are used for big vehicles–namely the Cadillac Escalade and Chevrolet Tahoe–but full hybrids haven’t been developed for the largest models.

Larger Hybrids

In Honda’s case, the Odyssey minivan and its Pilot crossover seem to be good models to target, possibly giving Honda a huge edge in segment fuel economy if they can develop the technology accordingly. Full hybrids run on electric only power for speeds up to 25 or 30 miles per hour (47 mph with the Fusion), but that means vehicles weighing over two tons would need to do so.

As far a complete electrification, Honda doesn’t seem ready to embrace that concept right now, waiting to see how demand for Nissan and BMW electric cars shape up.  Still, the Japanese automaker isn’t about to be left out in the cold and has developed a strategic partnership with a Chinese company to build electric car batteries.

Honda CR-Z: Sporty Hybrid

Finally, Honda delivers to us a hybrid with nice visual appeal.

To date, we have yet to see an attractive Honda hybrid with generations one and two of the Insight failing to inspire. The Honda Civic Hybrid has decent looks, but as far as dedicated hybrid models go, Honda has yet to deliver.

Honda Hybrid

Come August 2010 all that will begin to change. That’s when Honda will introduce the Honda CR-Z, a two-seat hybrid underpinned by the same platform powering the homely Insight. This time, Honda allowed its design team to influence its sport model and in judging its good looks has succeeded.

The CR-Z will be sold in Europe as a 2+2 model, but for the United States its two seats and nothing more. The European consumer is much more likely to put up with a second row while the American driver is not, especially with a car of this size.

As you can see by the supplied photos, the absence of a second row gives the CR-Z lots of storage room. That characteristic should appeal to people who want to combine good fuel economy with carrying capacity.

Priced Right

With a base sticker price of $19,950, the CR-Z is competitive. But this Honda won’t deliver something found in the five-passenger Prius: class leading fuel economy. Indeed, even the thriftiest model achieves just 39 mpg on the highway (35 locally), far behind the Prius’s 51 mpg city and 48 mpg highway.

Moreover, even gas models such as the Ford Fiesta and Chevrolet Cruze will offer equivalent fuel economy which means that buyers should explore what this Honda offers to make it worth their while.

Well Equipped

Fortunately, you won’t have to look too far as the CR-Z will include a number of sought after amenities as standard equipment. That equipment includes an AM/FM/CD/USB audio system with six speakers, automatic climate control, power windows and door locks, remote entry and cruise control.

Choose the CR-Z EX model and you will get a 360-watt AM/FM/CD high-power audio system with seven speakers – including a subwoofer – Bluetooth HandsFreeLink and a leather-wrapped steering wheel.

Honda Power

Honda says that the CR-Z will be powered by a 1.5-liter i‑VTEC 4-cylinder engine mated with its compact and lightweight Integrated Motor Assist (IMA) system to supply both power and efficiency to the CR-Z. A sport-focused, six-speed manual transmission is standard and an automatic Continuously Variable Transmission (CVT) is available and includes steering wheel-mounted paddle shifters for manual-like gear-ratio control.

Will the CR-Z sell? It probably will despite not having quite the advantages you would expect in a hybrid. Still, compare what the Ford Fiesta has to offer because other than emitting fewer emissions, this hybrid comes up short in the fuel economy battle.

Source: American Honda Motor Company, Inc.