Bucking the tide, Honda announced an eight percent increase in profits for the April-May-June 2008 quarter. Profits would have been higher still were it not for the incredible shrinking US greenback. The Financial Times tells us that "the yen's sharp rise compared with early 2007 – it hit a 12-year high against the dollar in March – reduced the value of its overseas sales and turned what would have been a 7.1 percent first-quarter revenue increase into a 2.2 percent fall." With over 50 percent of its business in the stricken US market, higher raw materials costs and a mix-shift away from higher-priced large vehicles to low-cost cars Honda still pulled a profit increase out of the hat. Then, there is what being able to nix the cash-on-the-hood for your best sellers does for a business. Sure the Pilot, Ridgeline, Odyssey and MDX need incentives to move; but the Fit, Civic, Accord and CR-V are all selling with no rebates and no dealer "marketing support". Meanwhile, over at your friendly Saturn dealer there is cash on the hood of ANY 2008. Even with today's good news, financial analysts are spooked by Honda's warnings that the second half of the year is likely to be more difficult than the first half was and that total fiscal year profits are likely to be down by 18 percent. Honda stock swooned two percent today, but GM dropped eight percent.
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Yeah, I’m not so sure about converting dollars to a changing yen. What were Honda of America’s numbers compared to last year? Apples-to-apples, please.
But congrats to Honda. Great job. Now get Acura in order!
“What were Honda of America’s numbers compared to last year? Apples-to-apples, please.”
Honda’s US sales revenue (including Motorcyles, Automotive and Power Equipment) was down 5.7% and US profits were down 2.5% when translated into Yen (which is what Honda reports it’s financials in). On 6/30/07 One US dollar converted to 123 Yen. A year later, the same US dollar converted to only 106 Yen, a devaluation of the dollar of about 14%. Thus in dollar terms, Honda’s US business was actually up about 8% in revenue terms and 11.5% in profit terms.
You can read the 28 page detailed report at:
http://world.honda.com/investors/financialresult/2009/2008_1st/2008_1st-e.pdf
That said, I agree that Honda needs to get it’s Acura house in order. It is by far the weakest corner of Honda’s US automotive efforts. It’s hard to believe Honda launched the Acura brand in 1986, fully three years before Lexus.
I remember when the Legend was viewed as superior to the various Germans on the basis of cost, features, and reliability. It was, for a brief time, the luxury car for smarter people. And nothing else on the road looked like the Integra.
Infiniti has gotten their shit together. Why can’t Acura?
The future looks bright for Honda. Soon they’ll have another new plant producing Civics in Indiana, and they’ll finally have a Prius fighter. Go Honda!
One of the things thats saved honda is they’ve never really built a truck-only line.
Yeah, the ridgeline sells like crap (it is crap, the most imagy of the image-trucks, without the stones to back it up), but heck, just produce more civics on the same line.
Agreed, the Ridgleline is a tough sell considering the competition will gladly sell you a REAL truck for considerably less.
But flexible manufacturing is allowing Honda to exploit the changing market conditions to their advantage. Smart.
“I remember when the Legend was viewed as superior to the various Germans on the basis of cost, features, and reliability. It was, for a brief time, the luxury car for smarter people. And nothing else on the road looked like the Integra.
Infiniti has gotten their shit together. Why can’t Acura?”
The Legend certainly was a wake-up call(That Mercedes-Benz ignored), but I don’t know about the “more reliable” part. The first gen(1986-1990) definately was not as reliable as a W124 or W123(or and E28). The Integra looked handsome, I still have no idea why they killed it off, it has a huge follwing. Honda needs to bring Acura to where it once was. They were king for a time in the early-to-mid ninties, and had a string of hits.Such as;
-1991-1995 Legend. Lives up to it’s name.
-1990-1993 and 1994-2001 Integra. Best front-driver ever.
-1992-1994 Vigor- Extremely underated and overlooked, which is a shame.
It pains me to see how they have fallen.
Acura even got it back in the early 2000’s. The first-gen TL was a force to be reckoned with, and a sensational value at the time. Then the 2nd-gen CL was a very nice coupe version. The TSX and RSX were also really great entry-level models. The MDX was the best large SUV out there. Plus, the NSX never showed its age. Then the 2nd-gen TL was good, but not phenomenal, and it was all downhill from there. Fattened MDX, useless RDX, underpowered RL… All disappointing, but the current design language is rock-bottom.
Honda profits rise, while ford announces biggest quarterly losses in its history. So Ford how much have you saved on rebadge , imported platforms, subpar materials and lousy fit and finish, postponed overhauls andshrinking diversity and demise of domestic engineering? looks like mister Ford, you have been saving on your own heart pacer, beep, beep….
it is crap, the most imagy of the image-trucks, without the stones to back it up
Agreed, the Ridgleline is a tough sell considering the competition will gladly sell you a REAL truck for considerably less.
I like pick ups. I live near a Home Depot and a Lowes and on my walks around the neighborhood I find all kinds of tools and hardware items that have fallen out of pick ups.
Seriously, what is wrong with the Honda Ridgeline? Honda certainly has a good reputation for quality vehicles so when I read quick brush offs like the above comments I wonder what is behind your comments.
When will Ford learn the lessons of the Japanese. They should have been more competive over the last decade – the writing was on the wall during the 190s. They are too far behind now make up the ground and profits will continue to fall while the Japanese go from strength to strength
…The Integra looked handsome, I still have no idea why they killed it off, it has a huge follwing…
A huge following of ricers. They’re not the typical Acura customer and they had a better shot of getting them into a Civic Si than moving them up into a TL or RL.
Speaking of Civic Si, when you have that car cannibalizing sales from the RSX, obviously one of them has to go, and dumping the RSX was the more sensible target.
The RSX-S was replaced by the current Civic Si, a superior offering, as Acura no longer wanted to associate itself with children driving recklessly… you know, “Advance”.
As a current-gen Civic Si owner, I can tell you that it was a good move on their part. More performance for less money will never go out of style.
It will be a tough year for Honda because their high margin products are not selling. Eventhough their Civic, Accord, and Fit products are selling well their profit margins are much smaller than their Pilot, Odessy, and Ridgeline.
Same situation for Acura, TSX selling well but they need the TL, RDX, MDX, and RL for higher profits.
kjc did you read the article? They wont be having a rough year compared to the rest of the auto industry, Toyota included.
The reason the others were mocking the Ridgline is that the base F-150 has considerably more torque, hp, 3500+ towing capacity, etc, at the same price point.
On the other hand it does appear to have a hell of a lot more than the base F-150. But in any case it doesn’t really scream heavy duty.
folkdancer, the Ridgeline is supposed to compete against the Chevrolet Avalanche but it falls far short in capability. The Ridgeline is a unibody construction vs body on frame of the Avalanche. The Ridgeline towing capacity is 5000# vs 7000# for the Avalanche. The Ridgeline has a V6 vs the Avalanche V8 with nearly 100hp & 100# torque more, and the EPA mileage rating on the Ridgeline is 15/20 vs 14/20 for the Avalanche.
“the Ridgeline is supposed to compete against the Chevrolet Avalanche but it falls far short in capability”
True, but the majority of Avalanche owners never use anything close to the “capability” of the vehicle.
Author: Mark45Comment:folkdancer, the Ridgeline is supposed to compete against the Chevrolet Avalanche but it falls far short in capability. The Ridgeline is a unibody construction vs body on frame of the Avalanche. The Ridgeline towing capacity is 5000# vs 7000# for the Avalanche. The Ridgeline has a V6 vs the Avalanche V8 with nearly 100hp & 100# torque more, and the EPA mileage rating on the Ridgeline is 15/20 vs 14/20 for the Avalanche.
Thank you for the comparison. Much of the comparison would interest me in the Honda but the terribly poor mileage is a turn off. I like the idea of unibody construction, simpler engine, and 5000 pound towing capacity is far more than anything I need but how or why did Honda screw up on the mileage so bad?
True, but the majority of Avalanche owners never use anything close to the “capability” of the vehicle.
This is so true. Since a friend of mine was foolish enough to buy one I have been on the lookout for an Avalanche doing ‘a bit of work’. In 3 years, living near Canada’s GM town (Oshawa ON), I have never seen one yet hauling anything except once when I passed an Avalanche with Maryland plates pulling an Airstream. My friend’s truck never does anything but get him back and forth to work except when it’s in the shop with it’s chronic brake problems. “Let me know if you need to haul anything” my friend says! When the time came and I needed to bring a trailer load of junk to the landfill it was in the shop having it’s rear brakes fixed for the umpteenth time. I was in a bit of a bind when someone else stepped up to the plate with a… you guessed it, a Ridgeline! Oh the irony of it all! Mission accomplished, Ridgeline 1, Avalanche 0.
In 3 years, living near Canada’s GM town (Oshawa ON), I have never seen one yet hauling anything except once when I passed an Avalanche with Maryland plates pulling an Airstream.
A lot of these vehicles are sold for their potential, not for their actual usage. These features have been important for generating sales, even though most people don’t use them.
Many SUV and truck buyers wish to feel like urban warriors and rugged individualists, even if they only use the vehicle to haul groceries. Ford ended up adding 4WD to a lot of Explorers that they knew that buyers would never take off-road because their market studies showed that customers wanted it.
This probably helps to explain why the sales are falling through the floor — despite their protests, deep down, these buyers know that they don’t really need these vehicles. They aren’t willing to pay the freight when the price of admission at the gas station is as high as it is today.
While GM fights off rumors of bankrupcy, Honda enjoys its best quarter in history. And all we can talk about is how the Avalance kicks butt over the Ridgeline?
OK, I like this game. So now let’s compare the Aveo to the Fit, the Cobalt to the Civic, the G6 to the Accord and any GM minivan to the Odyssey. Or the Equinox to the CR-V, the Trailblazer to the Pilot, the SRX to the MDX and the LaCrosse to the TSX.
Having fun yet?