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Money: Why Honda is hurting

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Old 08-06-11, 07:21 AM
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LexFather
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Post Money: Why Honda is hurting

http://money.cnn.com/2011/08/02/auto...m?iid=HP_River

What to me is disappointing is we are reading these articles for years now and they don't seem to have any clue on how to be "Honda" again. In comparison other companies that got whipped in the press got it together, GM, Ford, Hyundai, Toyota etc.....

The new Civic really let me know they are lost. They purposely pushed the new release back to make it better and it is average at best while losing the Si traits in that model. This turmoil is killing Acura who's problems have been well documented for years.

The article suggests they need a "Jolt" and new blood but their CEO is only a couple of years new. He's the same guy that said "the LFA is the old way of doing things" but has nothing remotely interesting to sell and Honda hybrids are far beyond the curve.

When will they if ever, finally wake up?




Why Honda is hurting
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By Alex Taylor III, senior-editor-at-large @FortuneMagazine August 3, 2011: 10:42 AM ET

Like all his predecessors, Honda's latest CEO, Takanobu Ito, worked his way up through Honda's famed R&D unit.

FORTUNE -- For years, Honda has been considered the ultimate playground of engineers. They rode to work on their Honda motorcycles and got to explore speculative projects like jet airplanes and humanoid robots. With a long list of technical achievements dating back to the CVCC engine of the 1970s (it produced a clean exhaust without a catalytic converter), they were rightly proud of their heritage and enjoyed an elite status within the company.

The result has been a hothouse culture where creativity is king, attention focuses inward, and marketability falls low down the list of corporate priorities. It was Honda that developed the first hybrid -- not Toyota -- but by stubbornly sticking to a bare-bones system, it long ago lost its leadership to its number one Japanese rival. A revolutionary pickup truck with a unibody construction, the Ridgeline, remains a market outlier. Meanwhile, recent product innovations, like the Honda Crosstour and Acura ZDX hatchbacks, were widely panned upon introduction and failed to gain traction in the marketplace.

The most recent evidence of Honda's insensitivity to customer needs is the 2012 Civic. Rather than taking note of growing buyer preferences for more comfortable small cars, it produced a simpler vehicle that failed to win a recommendation from Consumer Reports, a bible for many Honda customers. The Civic's success is critical to Honda because, along with Accord, it accounted for a hefty 83% of Honda's passenger car sales in the first half of 2011.

It didn't help when Honda's operations were severely disrupted by the earthquake and tsunami in March. The automaker has struggled to right itself, and its financial results have taken a severe hit. Revenues fell 27% in the first quarter, and its operating profit nearly disappeared.
10 most disappointing cars of 2011

Honda is suffering at the very moment when its two main Japanese rivals are thriving. Toyota is getting a jolt of energy from Akio Toyoda, scion of the founding family, while the ever-energetic Carlos Ghosn has made Nissan the leader in electric cars.

Which perhaps illustrates another part of Honda's problem: Ask 100 people in the auto industry who is the president and CEO of Honda, and the response from 99 of them will be a blank stare.

Since the retirement of the charismatic Nobuhiko Kawamoto in 1998, Honda has been led by a succession of relatively faceless engineers. The latest is Takanobu Ito, who, like all his predecessors, worked his way up through Honda's famed R&D unit. Ito, who turns 58 later this month, is best known as a chassis engineer on cars like the Acura NSX. He recently caused a stir by hopping on his Honda motorcycle and visiting Honda's heavily damaged Tochigi operation two days after the earthquake. Later, he posed for photographers atop his bike, improbably clad in a suit and tie.

Ito turns up in the automotive press from time to time, where he is quoted on such topics as the future of electric cars (Honda will have one in 2012) or the revival of the NSX (he's considering it). Rarely though is he heard musing about Honda's failures in product development, or its inability to cash in on the growing allure of small cars, or the continued failure of its Acura brand to gain traction.

What Honda needs, in part, is what every company needs from time to time: a jolt of new energy and a rededication to core values -- in Honda's case, "man maximum, machine minimum." A spinoff of the Hondajet operation, which won't deliver its first plane into a now-depressed market until a year from now, would eliminate executive distraction.

More than that, Honda needs to take a hard look at itself and, like a baseball team at free agent time, fill in the parts of its lineup where it is weak. That may include doing the unthinkable for Honda: recruiting some talented outsiders to take a fresh look at the market and its customers. With competitive new offerings from General Motors (GM, Fortune 500) and Ford (F, Fortune 500), Hyundai now in the mix, and Toyota about to unleash a product onslaught, Honda needs to stop playing with robots and refocus on the car business.

Last edited by LexFather; 08-06-11 at 07:29 AM.
 
Old 08-06-11, 08:35 AM
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rdgdawg
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A 4-year scientific analysis provided from a consortium from CR, Intellichoice, NADA, and JD based on style, road tests, driver feedback, daily living, etc. produced the following results after crunching over 4 terabytes of data:

Honda cars SUCK

Last edited by rdgdawg; 08-06-11 at 08:59 AM.
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Old 08-06-11, 09:00 AM
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I agree that Honda/Acura styling has gone way down in recent years, and they have come up with some goofy-looking designs like the ZDX and TL. But I would still pick them as equal to or better than any other automaker in the U.S. market when it comes to how well the car is built/assembled at the factory and the potential for long-term reliability.

Consumer Reports seems to pretty-much agree. Based on everything combined (performance, reliability, safety, road-test scores, etc...) they rank Honda, Subaru, and Toyota first, second, and third now in their brand-assessment of who makes the best overall vehicles. (Volvo, Ford, and Hyundai follow, in that order). Individual models, of course, can vary widely within a brand's line-up, but this is for overall brand-assessment. According to CR, Hondas do NOT suck.

http://news.consumerreports.org/cars...best-cars.html

However, that's not to say that things couldn't be better. I myself, for instance, noticed the cost-cutting on the new Honda Civic's materials, just as on the latest VW Jetta. The interiors. especially, on both cars, went significantly downhill, though the new Civic, just like all Civics before it, still retains the superb assembly-quality it's known for....though there have been some Honda recalls lately.

Rather than taking note of growing buyer preferences for more comfortable small cars, it produced a simpler vehicle that failed to win a recommendation from Consumer Reports, a bible for many Honda customers.
This is misleading. Honda usually does not recommend any all-new or extensively-redesigned models anymore until they have enough reliability-data for an average or better reliability-rating. No matter how well a new car performs in CR's tests, or how reliabile previous models have been, new models must now earn their ratings just like previous ones did.

And there's a reason for that. CR got burned recommending the all-new 2006 Camry solely from past experience. It didn't work.....some of the new redesigned Camrys had significant reliability issues.

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Old 08-06-11, 10:09 AM
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It was Honda that developed the first hybrid -- not Toyota -- but by stubbornly sticking to a bare-bones system, it long ago lost its leadership to its number one Japanese rival.
The author of this article needs to qualify his arguments, otherwise he could be accused of playing fast and loose with the truth.

Honda was the first to introduce a hybrid car to the United States (the original 2-door Insight) in 1999. Toyota did not introduce the Prius to the United States until 2000. But, the Prius had already been mass-produced and on the market in Japan since 1997. The Prius is now recognized as the world's first mass-produced hybrid car.

I really do not have an opinion on whether Honda will return to its past glory. My opinion is this: let the market speak. If the buyers (and I take it we are talking largely about American buyers) do not vote with their wallets and instead vote with their feet by walking away from Honda and Acura, then Honda deserves to fold up its American tent and leave.

One problem that I have with Honda is that for the past 10+ years, they have been trying too hard to be different, which resulted in some features being gimmicky, in my opinion, because they were not well designed. Some of the features that come to my mind:

1. The location of the spare tire in the Gen2 Odyssey (Honda's first large, truly North American-style minivan) was in the centre of the vehicle, only accessible from the footwell area of the 2nd-row seats. If you had a flat, you would have to unload the kids and all their stuff and leave it all on the side of the road to get to the spare.

2. The spare was moved in the Gen3 Odyssey, but the well remained, so Honda made it into a “lazy Susan” storage area that was not that easily accessible.

3. I remember climbing into the MDX when it was first introduced. There had been so much hype about it. I sat in the driver's seat and starting looking at all the controls. To my dismay, I could not find the climate controls. After much searching, I finally found a tiny pad between the two centre vents at the top of the centre stack; the climate control buttons were there, in tiny buttons. It seemed to me that in all the excitement of adding a large entertainment system monitor to the centre stack, that they had forgotten about the climate controls and finally had to squeeze it in somewhere.

4. The more expensive Hondas (Accord, Odyssey and Acura models being the most obvious) had their ergonomic climate control and entertainment/audio system dials replaced with a sea of same-size buttons. It did not help that Hondas split their entertainment system above AND below the climate controls – above for the large monitor and below for CD/DVD access and controls. Then they jumbled all climate control and entertainment buttons together in one big lump...

5. The most recent is the 2-tier instrument cluster on the Civic. After trying out digital displays in the late-1980s and early-1990s, most automakers have gone back to analog dials, leaving digital displays to motorcycles and a number of niche vehicles (including the Prius). I personally do not like digital displays; I find analog displays much more easily readable, in all lighting conditions, with or without polarized sunglasses on. Apparently, though, the mass-market buyers do not really mind because the Civic remained as one of the top 3-selling compact cars.
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Old 08-06-11, 10:12 AM
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Originally Posted by mmarshall
I agree that Honda/Acura styling has gone way down in recent years, and they have come up with some goofy-looking designs like the ZDX and TL. But I would still pick them as equal to or better than any other automaker in the U.S. market when it comes to how well the car is built/assembled at the factory and the potential for long-term reliability.
I agree with this. Design has lost its way, but build quality/reliability has continued to be one of the few +'s for Honda.

CR got burned recommending the all-new 2006 Camry solely from past experience. It didn't work.....some of the new redesigned Camrys had significant reliability issues.
2007 Redesign??



As for my reaction to this article, subjectively speaking I just can't stand Honda. Their mentality when it comes to design and engineering is so delusional and dated. Quite frankly I'm glad their sales goals aren't being met, because they need to do a better job of offering products that consumers want to buy rather than feel they need to buy just because society deems "reliability and fuel economy" important. I should add, I'm all for the aforementioned, but things like design and engineering and safety and fun factor should also be counted as well.

I've said it time and again. Honda is stuck in the past. With their super conservative views in regards to design and engineering built on "if it ain't broke don't fix it", I just don't see how they can evolve. With companies such as Hyundai adding a "fluidic" design language, Ford with it's "kinetic", and Lexus with it's "L-Finesse" as just a few examples. Both the exterior and interior of their products have become more modern and streamlined. Honda on the other hand is a mystery box of shapes and bulkiness and a dash of awkward.

Another thing that bothers me about Honda, is they refuse to give in to their consumer and enthusiasts fan base that beg for Honda to offer (V8, RWD, NSX Supercar, Sport coupes, mid engine, RSX, Prelude, Integra, S2000 etc..). Instead offering dull packages with aging tech and questionable design language. Aging engines and transmissions can only go so far. Makes me wonder what happened to Honda's R&D department??? Why not a true hybrid. Why this IMA BS. What about a Hybrid Accord? They can't rely on Accord, Civic, CRV and Odyessy forever. Honda to me is like a child star actor who never grew up.

It's not just Honda (a lot of automakers are going through this design identity crisis ie Mazda, BMW etc..) but Honda in particular needs to "find themselves" before they lose themselves.
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Old 08-06-11, 10:21 AM
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Originally Posted by Sulu
Honda was the first to introduce a hybrid car to the United States (the original 2-door Insight) in 1999. Toyota did not introduce the Prius to the United States until 2000. But, the Prius had already been mass-produced and on the market in Japan since 1997. The Prius is now recognized as the world's first mass-produced hybrid car.
The original Insight was released in the U.S. in January of 2000. I got to review and test-drive one of the first ones into the D.C. area. The Prius, which, as the author notes, had been sold previously in Japan, was not introduced here until August or September of 2000.....about eight months later. The Insight, being much smaller and lighter than the Prius, got substantially better mileage, but, in many ways, it was more of a toy than a real car. The Prius, for most people, was far more useful as an all-around daily-driver.

The most recent is the 2-tier instrument cluster on the Civic. After trying out digital displays in the late-1980s and early-1990s, most automakers have gone back to analog dials, leaving digital displays to motorcycles and a number of niche vehicles (including the Prius). I personally do not like digital displays; I find analog displays much more easily readable, in all lighting conditions, with or without polarized sunglasses on. Apparently, though, the mass-market buyers do not really mind because the Civic remained as one of the top 3-selling compact cars.
I agree that the Civic's dash-design is a joke, and its engines have traditionally been torque-deficient at lower RPMs. People buy it, though, because of the Civic's well-earned reputation for reliability, gas-mileage, slick-as-butter manual transmission, and quality-of-assembly.
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Old 08-06-11, 10:53 AM
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This seems to be one of the great stories of the car industry today, yet why does it seem Honda doesn't know it yet? I would say the only great thing to come out of Honda in the last decade is the FCX Clarity, the world's first hydrogen powered car. Other than that they seem so isolated from the rest of the industry.
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Old 08-06-11, 01:12 PM
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When Acura/Honda killed cars like: Legend, CRX, Prelude, Integra/RSX, i've never looked back. My first car was a 80' Honda civic 2 dr Hatchback, 2nd car 82' Honda Accord Hatchback, 3rd my favorite 86' CRX si, and 92' Honda Prelude.
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Old 08-06-11, 01:27 PM
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I think they'll redeem themselves in the near future.
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Old 08-06-11, 06:38 PM
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This is why I will not buy a new Honda anytime soon. I'm looking to buy another Honda, but it's going to be an S2000, not a CRZ.
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Old 08-06-11, 06:50 PM
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s2k is about the only Honda in the past 10 years that stirs any type of soul. can't wait for them to make something interesting again.. sad they discontinued the s2k. maybe Honda is too busy focusing on making jets?
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Old 08-06-11, 08:10 PM
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Originally Posted by mmarshall
People buy it, though, because of the Civic's well-earned reputation for reliability, gas-mileage, slick-as-butter manual transmission, and quality-of-assembly.
The perception of the good reputation is still intact, so Hondas (and to a certain extent Acuras as well) will continue to sell. (The new, beaked Acuras seem to sell quite well up here in Central Ontario, Canada.) We will have to see how well this new Civic sells, in comparison with the current model and in comparison with the new competition (Ford Focus and Chevy Cruze). We will also have to see how well the Accord does, especially the new generation that is due in about a year or so (assuming their usual 5-year cycle).

Perception lags behind reality (Hyundai and Kia are still perceived as cheap, lower-quality cars, despite what the quality studies may say) so Honda still has time to turn itself around if they want to and that is really what is needed.
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Old 08-06-11, 09:55 PM
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I'll just say, while I don't care for any Honda vehicles(styling), they make damn fine generators and atv's.
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Old 08-06-11, 10:04 PM
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Originally Posted by mmarshall
This is misleading. Honda usually does not recommend any all-new or extensively-redesigned models anymore until they have enough reliability-data for an average or better reliability-rating. No matter how well a new car performs in CR's tests, or how reliabile previous models have been, new models must now earn their ratings just like previous ones did.
Wait, so Honda doesn't even recommend Hondas anymore? That's good news for those of us who wouldn't drive one anyway! (I'm pretty sure you meant to say CR doesn't recommend them...)

I have to agree that their cars are pretty boring in the features, but some of their designs have done okay, IMO. I'm not going to be buying one anytime soon, as I have no need for another vehicle, but I usually don't consider Hondas mostly because I don't find them to have an offering where I want it to be - and I wouldn't touch a fugly Acura with a 10 foot pole.

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Old 08-06-11, 10:28 PM
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when it was time for me to toss my 2nd gen TL, i looked at the acura line up...and saw nothing that i wanted to buy. goodbye acura, hello lexus! end of story!


and mike, why no goat option for the poll? you know no poll is complete without a goat option!
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