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Title: Honda Gearing Up to Unseat the Mighty Prius
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Published: Dec 27, 2007
Author: http://blog.wired.com/cars/2007/12/honda
Post Date: 2007-12-27 21:02:19 by tom007
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Honda Gearing Up to Unseat the Mighty Prius By Chuck Squatriglia EmailDecember 26, 2007 | 7:05:23 PMCategories: Hybrids, Industry Gd4936672hondasnewconceptc9495_2 Honda brought the first gas-electric hybrid to America when it launched the funky Insight in 1999, but it was soon overshadowed by the Toyota Prius and Honda's been trying to catch up ever since. After eight years playing second-fiddle, Honda has decided enough is enough. Company president Takeo Fukui says Honda is investing heavily in hybrids and insists the race "has just begun." The technology's first phase was all about cultivating a green image, Fukui says, clearly taking a swipe at Toyota. The next phase will emphasize making the vehicles more affordable and fuel efficient, he says, and Honda has two cars in the pipeline that he promises will challenge Toyota's eco-supremacy. "The real full-scale hybrid competition will start from now," Fukui says. Fukui's got his work cut out for him. The Prius is synonmous with hybrid technology, and 79 percent of the gas-electric vehicles that rolled out of American showrooms last month were Toyotas. Just one in 10 were Hondas, and the company has discontinued the Insight and Accord hybrid. Yet during his year-end speech to employees, Fukui predicted hybrids will account for 10 percent of Honda's sales by 2010. To reach that goal, Honda will have to sell some 400,000 hybrids a year. It may not be enough. Toyota says it wants to sell 1 million hybrids a year within the first half of the next decade. 31prius1m_m_copy There is no question the Prius defines the hybrid niche. The Prius accounted for half of the hybrids sold in America last month. Toyota sold 167,009 of them in the first 11 months of the year, compared to 32,610 hybrid Civics, Accords and Insights. (Interestingly, although the Prius remains the most popular hybrid, Carmax.com says search activity for the Ford Escape hybrid rose 108 percent between October and November, compared to a 56 percent increase for the Prius. All searches for hybrid vehicles climbed 43 percent during the same period and 10 percent in the past year.) Fukui concedes offering hybrid versions of Honda's best-selling cars instead of designing a new car was a mistake because "until now, it has been an image-based competition, not a business-based competition." It's a valid argument. 06hondainsightf34500 While the Insight had an utterly unique look, the Civic and Accord hybrids are visually indistinguishable from their gasoline counterparts. The Prius, on the other hand, has a look all its own, which is one reason it's so popular. A survey by CNW Marketing Research found nearly half the people who bought a Prius did so because it's unique shape "makes a statement." Honda's hybrids also have been hobbled by their prices. While the Prius has a list price of $21,100, the Civic hybrid starts at $22,600 (the Toyota Camry hybrid goes for $25,200). Hybrids typically cost more than their gasoline counterparts and other vehicles in the same class. While it's tough to argue that hybrids aren't more ecologically friendly than their fossil-fuel counterparts, a study by Consumer Reports suggests they aren't any cheaper in the long run - and may even be more expensive - than conventional cars. (Note: Sentence retracted, as Consumer Reports retracted the report as incorrect. Thanks to readers for pointing that out. / cs) Fukui says this must change. "The price needs to be reasonable and fuel efficiency higher so the (premium) the consumer pays can be returned in a short period of time," he said during his year-end speech in Tokyo. Honda_crz_rear To that end, Fukui confirms Honda will offer a subcompact hybrid in 2009. It will feature a smaller, lighter engine to improve fuel economy and a lower price than the Civic hybrid. Although it's been rumored that the car will be a variation of the Fit, Honda says it will be a new model. And while automakers are increasingly turning away from "performance" hybrids, Fukio says Honda plans to launch a hybrid sports car based on the CR-Z concept unveiled earlier this year at the Tokyo Auto Show and headed to the upcoming North American International Auto Show in Detroit. Fukio also says Honda is investing $425 million in a new research center that will focus on developing the "next generation" of automobiles, including hybrid and hydrogen fuel cell vehicles like the FCX Clarity. One thing Honda doesn't plan to pursue, however, is plug-in hybrids. Fukui says the company doesn't place much stock in the technology.
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