Honda Civic to be Sold Only as a Hybrid
Well, in Japan anyway. That's the growing buzz coming out of Honda's home country, where reports indicate the automaker will only offer its hugely popular compact with a hybrid powertrain through the rest of its current life cycle, then continue with that strategy for the next-generation model. There's no comment'”yet'”about what this means for U.S. buyers, but putting more resources behind the Honda Civic hybrid could be a big boost for the company, especially as it's about to face significantly higher levels of competition in the compact segment.
The current Civic has been lurking around for about five years now, but it remains a strong player in the marketplace. The car's streamlined exterior still stands out from that of its blander rivals, it still offers a very competitive EPA line of 25 mpg city/36 mpg highway/29 mpg combined, a relatively dynamic driving experience, and both coupe and sedan models offer MSRPs of under $16,000 for their base models.
That combination of features has helped the Civic maintain its place among the best-selling cars in the U.S., moving the metal to the tune of 133,601 sales in the first half of 2010. Yet that represents only a 13.5 percent increase compared to the first six months of 2009; in May, the Civic's monthly selling rate was down 4.6 percent on a year-over-year basis.
Part of the problem here is that the Civic just doesn't offer a clear benefit over its current rivals. The combined EPA mileage of all the key Civic competitors'”Ford Focus, Kia Forte, Toyota Corolla, Nissan Sentra, Chevrolet Cobalt and Hyundai Elantra'”are within 1 mpg of each other.
There's a wider range of MSRPs here, but it's not necessarily to Honda's advantage. If we compare air-conditioned models, it takes $16,405 to get into a Civic sedan, while being able to stay cool in a Sentra or Corolla can be done for about $1,000 less. And with up to $4,000 in "down payment assistance" now available on the Cobalt, I'm thinking it's going to undercut the Civic as well.
The compact segment is going to change considerably in coming months, too. Both the new Chevrolet Cruze (replacing the Cobalt) and next-generation Focus are expected to ratchet up ye olde bar significantly, with all-new designs and the ability to reach 40 mpg on the highway. The highly anticipated new Elantra is also on its way, and that looks like it's going to be the Hyundai Sonata all over again.
We also have to throw Volkswagen into the mix. The VW Jetta already outsells the Forte and the Sentra by a comfortable margin, leveraging a distinctly European take on the compact driving experience. With an all-new, completely redesigned Jetta launching in October, supported by a strong push from VW to increase U.S. volumes, the Civic is going to face yet another difficult test.
At the same time, Honda has indefinitely delayed the introduction of its own next-generation Civic, so that these four brand-new, top-notch compacts will be facing a Honda entry that's yet another year behind the times. Now, if only there were still something the current Civic could offer that even these upstarts couldn't ... some feature or benefit that truly differentiates the Honda from the competition ... something like, oh, how about a hybrid powertrain?
See, it's sort of gotten lost amid the hype surrounding the Honda Insight and Honda CR-Z hybrids, but Honda also still sells a hybrid version of the Civic. In fact, the Civic hybrid gets better mileage than either of those other two hybrid-only products, coming in at a stellar 40/45/42.
Which brings us back to our starting point: As other automakers have caught up to Honda as regards efficiency, reliability and the fun-to-drive factor, it's been struggling to find a new brand promise on which to hang its corporate hat. The Insight and CR-Z have been efforts to show Honda can be a player in the hybrid game, but they haven't exactly set the sales charts afire. So perhaps the company is about to go "all in" by switching one of the best-selling U.S. car lines of all time to a dedicated hybrid role, first in Japan, and then here?
I wouldn't bet against it.