Honda lifts sales target in response to revival

AUTOMOBILES

Honda Automobile Thailand, the country's second-largest passenger car manufacturer and exporter, has raised its sales target up 5% to 84,000 units in anticipation of a recovery of the struggling automotive industry.

"Based on sales of Honda cars in the first half, we see a silver lining in the Thai auto market. That is why we are revising our sales target upward this year," president Atsushi Fujimoto said yesterday.

Higher sales will be contributed by existing small models such as the Civic, City and Jazz and new models, including the Freed mini-multi purpose vehicle (MPV) later this year.

The Japanese automaker is also banking on government stimulus spending to lift public confidence, thereby increasing automobile demand.

Overall automobile sales are projected at only 480,000 units this year, including 210,000 passenger cars.

Honda does not make pickup trucks, the most popular vehicles sold in Thailand but also the worst performers this year.

Domestic sales for Honda cars are recovering but its exports remain weak as overseas markets have not yet improved.

"Honda, to date has about 16,000 back-orders, mostly smaller models that will take about two or three months for delivery," said Mr Fujimoto.

The slump in local sales and exports last year forced Honda to cut production at its two plants in Ayutthaya. They have a combined capacity of 240,000 units per year but are now running at a rate of 120,000 to 130,000 units.

Mr Fujimoto said Honda also aimed to continue improving the profile of its brand, with rising customer acceptance reflected in overall sales growth year-on-year.

Last year, Honda sold the highest number of passenger cars in the Thai market. ahead of the overall industry leader Toyota.

In April and May this year, Honda took the top spot for most cars sold. From January to June, it achieved a 17.3% share of the total automobile market and a 39.4% share in the car segment.

Though Honda continues to introduce more environmentally friendly vehicles, Mr Fujimoto said it had no plans at the moment to introduce hybrid models to match Toyota, which will introduce a hybrid Camry next month.

He said Honda was still not certain whether gasoline-electric models would do well locally as the production costs were high.

Honda sells its hybrid Insight, Civic and Accord models overseas.