From concept to production reality
20 March 2018
Author: Guy Bird
In 2007, Honda's UK sales hit a heady 106,018. A decade later, its sales tally was almost halved at 53,901. Despite the global recession and market reboot, Honda UK managing director Dave Hodgetts has already stated that the first, bigger figure was less real-world. "Those figures were not sustainable, on the back of a weak Japanese yen and a very high level of corporate sales," he said. "We cannot afford to be in that volume game."
It's a sentiment backed up by the head of Honda UK's car division, Phil Webb, who spoke to BusinessCar at the Geneva Motor Show. "We're not talking about that sort of number at all anymore," he said. "We have no aspiration to be at that point. Globally, we're one of the most successful companies and the biggest engine manufacturer, and we've only got a certain number of factories. If those factories are producing for all around the world, there are only so many that can come to Europe, so we will grow our business gradually."
As part of that 'softly, softly' approach, fleet sales operations manager Marc Samuel does want to grow fleet sales; corporate sales make up 35% of total registrations of new Hondas. But he is wary. "I'd love to say we could grow the fleet share, but we need to be honest about what we do," he concedes. "I don't need to go out to those high-cost, tactical markets. The way we've structured our team, with a proper major accounts focus, is to ensure we're actually dealing with end users. At some point, we will start to mirror the industry, but I think we've got at least 24 months before we get anywhere close to that."
Meanwhile, Webb reckons the next few years will see sales of 53,000-54,000 units every year. In 2017, the top seller in the current five-model line-up, including the ultra-niche NSX, was the Jazz supermini with 18,617 sold, followed by the Civic (five-door, Tourer and Type-R) with 16,037 and the CR-V with 13,056.
This year's numbers should be buoyed by some exciting new products covering various bases, though. For a start, there's the new 120hp 1.6 i-DTEC Civic diesel, offering 80.7mpg and 93g/km, arriving in August. "From a corporate perspective, 40% of drivers are still driving diesel cars, as they're high-mileage users," says Samuel. "Over 25,000 miles a year, the economies of scale mean you want a diesel car, but with the refinement of a petrol. You also want the taxation to be right, so that's why we're very confident of the new Civic diesel we're bringing to market."
The new fifth-generation CR-V will also bring new opportunities with a new petrol engine in September and a hybrid version three to four months later. Details are to be confirmed at launch.
That's the bread-and-butter side of things improved for the important core market. In a more niche area, but arguably more exciting, was the announcement that Honda UK will start taking orders for the production version of the critically acclaimed Urban EV concept. These will be taken in early 2019 for delivery later in the year. "We have a very loyal customer base," explains Webb. "But when that concept car becomes production reality, it will give us a great opportunity to bring new people to our brand."
Finally, might the uncertainty of a looming Brexit mess with steady sales plans and UK operation? Webb thinks not. "Honda's in a really strong position, due to buoyant US sales of the Swindon-made Civic. We're a global company and will source our parts from the right places at the right time too," he said. "Honda UK will be taking cars out of Swindon and three other models out of Japan, so the arrangements we have with Japan are paramount and we've been very vocal on that to the UK government.
"We won't use the corporate market as a reaction, either. If retail's down, we'll go to market in a proper way, with things like the Platinum Programme. When a corporate customer walks into a dealership, the Platinum Programme is about them getting spoken to in the right way about CO2, BIK and the various different finance options. It was launched in September 2016 and we've grown it to 104 dealers out of a network of 154, now. Even more dealerships are coming on board, because they recognise that fleet and business is the biggest-selling part of the industry."