Honda Sets Ambitious Sales Goal; Will Launch More Compacts

John_Mendel

John Mendel

In a keynote address at last month’s J.D. Power 2013 International Automotive Roundtable in Orlando, FL, that was co-sponsored with NADA, John Mendel, executive vice president, automotive sales at American Honda Motor Co., said he is proud of the larger role that Honda’s North American R&D group will play in global product development—including development of the all-new generation Acura NSX halo sports car and in taking a lead in Honda’s new global compact car initiative. Growth plans from his talk are excerpted:

“We set a goal to achieve an all-time sales record this year in 2013, which would mean meeting or exceeding our previous best of more than 1.55 million units that we sold in 2007. Last fall, our CEO announced very aggressive growth plans for global Honda. By the fiscal year ending March 2017, we’re challenging ourselves to achieve global automotive sales of 6.0 million units. In perspective, that’s up from 4.0 million last year. Almost one-third of that volume will come from the U.S., meaning annual sales of somewhere between 1.8 and 2.0 million units here in North America. Continue reading ›

J.D. Power International Roundtable Provides Future Industry Outlook

HumphreyJ

John Humphrey

After a successful 2012, the outlook in 2013 for the automotive markets in the United States and China remains optimistic, according to John Humphrey, senior vice president of global automotive at J.D. Power and Associates. He gave projections for the global auto industry during a presentation at the recent J.D. Power 2013 International Automotive Roundtable in Orlando, FL. Some 500 auto industry members—including dealers, marketers and executives from automakers—attended the one-day conference that was co-sponsored with the NADA. Some highlights from the presentation:

Auto Sales Shift to Emerging Markets

In 2013, the global automotive industry faces a somewhat mixed economic bag; the average GDP of mature markets will grow at about 1.4%, while the world’s largest emerging markets will grow by 5.5%, on average.*

Clearly, the United States and China are the bright spots to watch in 2013 and thereafter, in terms of sales and production potential. That said, there are pockets of overcapacity in the global industry that need to be addressed. In 2012, total global capacity for light vehicles reached 116 million units, against total global sales of 81 million units. This roughly translates to a utilization rate of 70%—well below the 80% threshold that most automakers need to reach to achieve financial breakeven. While utilization rates can vary widely by market—and impact the health of individual industries—the overall rate for the global industry can positively or negatively affect automakers with global operations.

Looking toward the end of the decade, the global automotive industry is plainly being driven by the largest emerging markets. In 2012, Asian markets accounted for 41% of the 81 million light vehicles sold globally—primarily China and India. By 2019, Asian markets will account for 49% of the 115 million vehicles forecast to be sold globally.

Continue reading ›

China’s Automakers Eye India for Future Growth

Ammar Master

Ammar Master

The rapid emergence of India as a major automotive powerhouse coupled with the ambitions of China’s automakers to go global are the principal drivers behind the planned entry of China’s big automakers Beiqi Foton and Great Wall Motor.

Foton aims to become a key global player over the next decade, according to its 2020 Strategy statement. Under the truck maker’s “5+3+1” strategy, India is a key region in its growth plan along with Brazil, Mexico, Russia and Indonesia.

This is why Foton signed a Memorandum of Understanding (MoU) with the Maharashtra government in India last April to establish a manufacturing unit at an investment cost of $307 million over 5 years. It is currently in the process of setting up its plant in Chakan (near Pune) to build light-, medium- and heavy-duty commercial vehicles. Continue reading ›

Automakers Ready to Turn Attention to the Future after Strong Finish in 2012

 

Tim Dunne

Tim Dunne

J.D. Power Asia expert Tim Dunne provides a perspective for members of the auto industry, especially automakers in Japan, on the U.S. market and offers a glimpse at issues and concerns and changes that are likely to impact the world’s manufacturers in the future. Excerpts from an article published recently in Japan’s Automotive Daily Nikkan Jidosha Shimbun are featured in this post.

As 2012 draws to a close, light-vehicle sales in the United States are expected to finish the year strongly. Vehicle manufacturers estimate total sales will top 14.4 million units for the year, which translates to a healthy 14% increase vs. 2011’s total of 12.7 million units. The 14.4 million-unit total would be the highest annual sales in the United States since the industry reached 16.1 million units in 2007, and represents nearly a 40% increase over 2008, when industry sales tumbled to an anemic 10.4 million units at the lowest point of the recent “Great Recession” (December 2007–June 2009, according to the National Bureau of Economic Research).

For many Japanese brands operating in the United States, 2012’s final results will be even better than the industry average. Sales of Toyota Group vehicles (Toyota, Lexus and Scion brands) are currently up a combined 29%, and are on track to reach 2.05 million vehicles for the year; Honda Group sales (Honda and Acura brands) are currently up 24%, and are expected to top 1.4 million units for the year; Subaru sales are up 29%, and are expected to top 330,000 units for the year. Continue reading ›

J.D. Power’s Humphrey Offers Brighter Outlook for Global Auto Market

 

Leslie Cocco

The global automotive industry, including North America, is better able to keep production in line with demand than in the past, according to John Humphrey, senior vice president and general manager of J.D. Power’s global auto operations. John told participants at our 2012 International Automotive Roundtable today that J.D. Power is largely bullish about the auto market in the near future, projecting global sales of 79.2 million light vehicles in 2012, and rising to 99 million unit sales in 2015.

Humphrey stated that more than half (55%) of global auto sales in 2015 are projected to be in emerging markets, and he pointed out that drivers of this growth include the return of sub-prime-credit customers to the market, decreasing credit restrictions, and increasing demand.

John Humphrey

Humphrey also said there are risks to this growth: geopolitical tensions in the Mideast Gulf region; the negative impact of the Euro debt crisis; unemployment; the economic slowdown in China; and the lack of infrastructure in emerging markets.

Humphrey also discussed the inevitable change in the market in relation to Gen Y consumers. Changes that he mentioned are technology-driven, and relate to the way that young shoppers expect to do their shopping—online, via mobile, and Apps—and the expectations they have for technology in vehicles. A majority, or 79%, of shoppers are going to third-party sites, rather than OEM or dealer sites, which makes brand management and messaging a challenge, he said. Continue reading ›

What Lies Ahead for Automotive Marketers in the Age of Digital Marketing

The world of marketing is rapidly growing with a new age of marketers who will need to keep up with the changing environment. This new age of digital marketers will have a different mindset, tool set, and approach to digital marketing as exhibited in an interesting scenario.

There are seven new-age marketers ready to compete with their ideas for what is called the “Ultimate Marketing Championship” or UMC13, suggests Jason Deal, executive vice president and digital group account director at Initiative USA. He presented a fantasy portrait of these new-age marketers at this year’s 2011 Automotive Internet Roundtable. Continue reading ›

How is Digitization Changing Marketing and Connecting in the Car?

Digitization is changing the way vehicles are driven, the way vehicles are marketed, and it is changing the very experience of life. During the recent J.D. Power and Associates 2011 Automotive Internet Roundtable in Las Vegas, NV, a panel of OEM, third-party website and digital technologies company experts discussed opportunities and challenges for the auto industry in taking advantage of these new and future digital technologies, including GPS predictive technologies, telematics, gesture recognition, and inter-communication of vehicles and signals.

Some of the key topics and trends from the panel discussion are summarized:

• The sky is the limit. Computing power is increasing and consumers are adopting technology much faster.

• Specifically, the technology for cars to drive themselves is already available. Re-engineering will be needed to make it affordable. The real issues are government- and society- related. Safety and liability issues need to be considered as well. Panelists estimated that self-driving cars may be available in 5+ years. Continue reading ›