Tsunami possibly weakened Honda’s April sales
by Patrick McCreless
Star Staff Writer
May 05, 2011 | 2721 views |  0 comments | 5 5 recommendations | email to a friend | print
While up over last year, April sales for Honda’s U.S. subsidiary showed fewer gains than those of its foreign competitors, something some automotive experts suspect is the fault of a Japanese tsunami in March.

American Honda’s latest sales figures, released Tuesday, show the company sold 5.7 percent more vehicles this April than April 2010. The company’s 2011 year-to-date sales increased by 14.6 percent compared to the sales made during the same timeframe last year.

The Odyssey minivan and Pilot sports utility vehicle, produced exclusively in North America by Honda Manufacturing of Alabama in Lincoln, were among the models that had improved sales. Honda sold 36,306 Odysseys in the first four months of 2011, compared to 33,613 sold between January and April last year. Over the same period this year, the automaker sold 34,023 Pilots, compared to the 31,291 sold during the same timeframe last year.

“The Odyssey is performing extremely well, and the Pilot is strong, too,” said Chris Martin, spokesman for American Honda’s sales division. “Honda, up through April sales, we’re very satisfied with those numbers.”

However, Honda’s April gains pale compared to some of its competitors.

According to the automotive analyst website Edmonds.com, General Motors’ sales in April increased by 26.4 percent compared to April 2010, while Ford’s increased by 14.3 percent and Chrysler’s by 22.5 percent.

Honda’s fellow Japanese automaker, Toyota, posted a 1.3 percent gain in sales.

Bill Visnic, auto analyst and senior editor for Edmonds.com, said the lag in sales gains for Honda and other Japanese automakers can likely be attributed to the March tsunami.

“Sure, it’s always good to outperform from where you were last year … but Honda and Toyota trailed everybody else,” Visnic said. “That seems to be an indicator that already they are having some difficulties in getting enough supplies.”

The tsunami has caused significant production delays for certain parts for Japanese automakers.

In a press release issued Monday, Honda said overall automobile production in North America would remain at significantly reduced levels through the summer months. The company’s goal is to normalize production near the end of the year. The recovery will occur step-by-step and will vary based on plant and model.

Honda Manufacturing spokesmen have said the company is doing its best to avoid layoffs during the downtime, instead allowing employees to take training courses or vacation time when there is no work. The company employs 4,000 people.

Visnic said the inability to produce enough vehicles would likely mean further dips in sales for Honda in the coming months.

“We’re not issuing any kind of hard numbers, but definitely the feeling is we’ll see their sales dip because of low inventories,” he said.

Martin said Honda’s current sales picture is not due to the tsunami.

“That hasn’t really hit us yet,” he said. “The cars in Alabama, anything they needed was already on the boat when the tsunami hit.”

Martin said it’s hard to compare sales growth between different automotive companies because each company is different and has different goals.

“We really had our own internal sales goals,” he said.

Dennis Virag, president of the Automotive Consulting Group, agreed with Visnic, however, that Honda’s slower gains were likely due to the tsunami.

“They are still being hampered by production delays in Japan,” he said.

However, Virag disagreed with Visnic that Honda’s sales would continue to decrease in the months to come.

“I don’t think they’ll decrease, but they’ll increase less than domestic and European manufacturers,” Virag said.

Martin did say that the effect from the tsunami would probably hurt Honda sales in the near future.

“Moving forward, it will definitely have a larger effect on us,” he said. “But if we have fewer gains, it’s not going to be because of lack of demand. We’re doing well on that front.”

Virag agreed that Honda was competing well and would not suffer too much from the tsunami’s impact.

“The tsunami is just a short-term setback,” he said. “Honda is going to do OK — they are a very resilient company.”

Star staff writer Patrick McCreless at 256-235-3561.
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