For the first time during May 2008, the Honda Civic sold more than 50,000 units as consumers responded to record gasoline prices, making it the best selling car in America. The rapidity of the growth in demand has left Civic inventories at a mere 16 days.[1]
Success with the Civic is evocative of Honda's wider growth despite a downturn in US auto sales. For the first six months of 2008, Honda's US sales increased 3%, while the market decreased 11%. At the same time, Honda's major competitors all saw a considerable sales decline, with GM's sales falling 18%, Ford's down 14%, and even Toyota's dropping 7%.[2]
Honda is known for its innovation, which is the cornerstone of Honda's corporate strategy. More importantly, Honda is the U.S. leader in fuel efficiency, and is working toward becoming the global market share leader of hybrid vehicles sold. The recent increased emissions regulations and rising fuel costs have allowed Honda to reap in the profits from placing green technology as its core strategy.
Honda is the U.S. leader in fuel efficiency, which is becoming ever popular as oil prices rise. They claim to have come up with the first hydrogen powered car. The Honda FCX Clarity is a hydrogen powered car that claims to have twice the efficiency of traditional gas and electric hybrid vehicles. And it doesn't emit greenhouse gases. Ever. No matter what mode it's in. (Although one could argue that the greenhouse gases involved in creating the electricity portion are an issue.)
Honda (HMC) is looking for a way to compete in an auto market that is increasingly focusing on green technology and decreasing dependence on rising gas prices. And with the Clarity, Honda may find itself back in the game (its own gas and electric hybrid attempts were creamed by the Toyota (TM) Prius).
Right now, though, only a few people can test-lease the Clarity. This is because there aren't many hydrogen fueling stations around. Honda wants to make sure the Clarity's drivers have access to fuel, so the initial offering, here in the United States, is pretty much based in certain parts of California. But if investment in this grows, and if the Clarity finds success, it may be that Honda finds its green motor stock rising.
Toyota has traditionally taken first-mover's-advantage by introducing the Prius to the Japanese market back in 1997, but Toyota's recent recall woes, Honda has decided to step up and introduce the new 2010 CR-Z, which will return 50 miles per gallon but still create a great feel to driving. Honda hopes to take away Prius market share on two fronts: 1) that the Prius may be green but is not aesthetically pleasing and that 2) the Prius is by no means a sport vehicle.
By creating a vehicle that is fuel efficient, economic in pricing, and looks great, Honda is set to capture more of the ever burgeoning green vehicle industry.
Honda signed a joint venture with DongFeng Honda to build a second auto plant in China today, 1/22. The newly constructed 1 million square meter plant will have an annual capacity of 60,000 units, and can increase up to a maximum of 240,000 units per year. This gamble should ultimately prove profitable for Honda, as China is a rapidly developing market, and can take market share away from Toyota. Toyota, for example, in 2009 had a 64% year-to-year increase in auto sales in China.
Honda is known for its innovation, which is the cornerstone of Honda's corporate strategy. More importantly, Honda is the U.S. leader in fuel efficiency, and is working toward becoming the global market share leader of hybrid vehicles sold. The recent increased emissions regulations and rising fuel costs have allowed Honda to reap in the profits from placing green technology as its core strategy.
