Honda Moves Forward
Some Honda models may look unchanged for even longer than usual over the next few years. But a bunch of new Honda vehicles are already on the way.
As a result of spending money (lots of money) on developing electric vehicles, many of which Honda has wisely cancelled, the company has posted a net loss for the first time in almost 70 years. This is a testament to just how well-run Honda has been for decades. While Honda is a smaller company than many of its competitors, like Ford, GM, and Toyota, they make very competitive, very engaging, and reliable cars. Something other, bigger manufacturers still have yet to master.
All of this is the real-world impact of misplaced, big-investment, electric car plans, something the market conditions simply do not support. Many electric vehicles were built to comply with unreasonable pending legislation, primarily driven by California. Anytime you're building a car (or any consumer product) for compliance, it's going to hurt both the maker and the consumer of that product. In this case, it’s Honda that suffers.
A quick example of how consumers suffer is the dizzying EV depreciation rates. Many people want electric cars when they’re hugely discounted; only a few people want them at the normal, good business case, retail price. Total Honda losses from now-discontinued EV plans and related restructuring are around $15.6 billion.
Honda’s Path Forward
Honda is predicting a profit rebound, according to the Financial Post.
To help negate these losses, Honda has a plan to extend current models in their current form. In other words, certain models won't get updated or be all new for a little bit longer than usual. For example, the Honda Accord, Honda HRV, Honda Odyssey, as well as the Acura Integra and MDX, are all going to be unchanged a little longer than they normally would. New versions of these models are expected by the year 2030.
If it were a company other than Honda, this strategy could be harmful, but because Honda has such good vehicles to begin with and such a name and brand equity with North American consumers, this probably won't hurt them much in the end. It’s a smart plan to make up for lost dollars that they probably shouldn't have spent in the first place. If I were guessing, based on what I’ve known of Honda in the past, the company ignored its gut and overinvested in EVs against some strong internal opposition.
Electric vehicles can be very good, but for many, owning an EV is an additional burden they don't want to add to their already complex lives. Honda’s notable electric vehicle, the Prologue, is quite good. But we wouldn't expect anything less from Honda.
The Cars are Already Good
Of the vehicles with an extended lifecycle, the Odyssey may be the one that's going to feel old first, as it made its debut in January of 2017. Therefore, it's already a nine-year-old vehicle- so that is something that the consumer could criticize Honda for; however, when you drive the current Odyssey, it still feels modern and well screwed together. In 2017, Honda gave the Odyssey tons of modern tech, most of which is still useful today. At the time, Honda invited families to try the Odyssey on a road trip. Nothing highlights pluses and minuses quicker than loading up a bunch of kids and parents.
Surely Honda will add new colors, new interior materials, new wheels, and maybe a few other things to keep it feeling fresh within the next few years. Add the typical Honda reliability and excellent resale value, and the Odyssey will continue to serve many families well.
The current Honda Odyssey's resale value shows just how in-demand it remains. Check these Capital One Auto Navigator prices. Just one example - a 100,000-mile 2021 Odyssey is still worth about $25,000 well into 2026.
Honda Civic Sport Hybrid is an excellent vehicle and a decent bargain, too. Most consumers have said hybrids meet them where they are, and it's the kind of car they can make fit into their lifestyle today.
The Accord was just reworked for 2023 and is already an excellent car. 2030 is only four years away. Given how well Honda hybrids work, an “all-hybrid” Accord lineup by 2031 is likely.
.jpg)
In the end, Honda has come up with a reasonable plan on the road back to profitability. Here’s hoping their longstanding passion for creating cool, efficient, innovative, and interesting cars results in more S2000, Civic del Sol, and Element-like vehicles. Imagine a hybrid, 40 mpg Element-like SUV…
To show that they're on the right path, Honda recently showed an all-new hybrid sedan prototype. Honda says it will have 15 new hybrid models globally by 2030.
-Brian Moody
Here's more on the Honda Civic Hybrid Hatchback via TikTok
Comments
Post a Comment