Accord Sales Decline Below 300,000 Not Gut Punch; Next Civic a Challenge

Special Coverage

North American Int’l Auto Show

DETROIT – American Honda Motor Co. Inc.’s Accord sales dropped below the 300,000-unit mark in 2009 for the first time in 24 years.

But a top company official says he is unmoved by the event, blaming the falling U.S. light-vehicle industry, rather than the competitiveness of the Accord, for the poor showing. The Accord lineup includes the sedan and coupe, as well as the new Crosstour cross/utility vehicle.

“I don’t think psychologically it’s a blow,” John Mendel, executive vice president-American Honda, says in a small roundtable interview during the North American International Auto Show here.

“When you see an industry go from 16.5 million (units) to 10 (million) and your Accord sales are down 18% or something, it’s hard to say (the Accord’s) going to buck the trend of everything out there.”

The Accord lineup registered 290,056 sales in 2009, Ward’s data shows. The last time Accord deliveries fell below the 300,000 mark was 1985, when Honda sold 268,420 units.

From 1986, Accord sales continued to climb, hitting a benchmark 417,179 in 1990, tumbling to the 300,000-unit range in ensuing years. But Accord sales hit their second-best 414,718 units in 2001, beating out the Toyota Camry as the best-selling midsize car in the U.S.

Accord sales declined steadily for the decade but closed in on 400,000 units again in 2007 with the launch of the current generation model.

Auto analysts and enthusiasts have decried the Accord’s large size as detrimental to Honda and the car’s legacy.

Civic sedan appeals to diverse group of buyers.

Mendel disagrees, noting the still-healthy annual volume. But he questions whether the “next-generation has to be that big. “How do you still keep the next-generation with all the Accord-ness people have come to expect and not lose the essence of what the vehicle is about?”

The Accord and Civic compact are Honda’s most iconic and best-selling model lines.

But Mendel says with the looming 2015 corporate average fuel economy regulations, Honda is evaluating its entire portfolio to figure out if it can achieve government mandates for fuel economy or whether its models need to become “lighter, faster, nimble more efficient.”

As “linchpins” of the brand, Honda also is perplexed about how to keep such high-volume models appealing to the young but also inoffensive to older buyers.

“The problem when you have vehicles that sell 300,000, 400,000 units is you can’t afford to alienate,” Mendel says.

The Civic is due for a full revision soon, and Mendel says keeping the momentum of the current model going, which launched in 2005 as an ’06 and is well-regarded for its styling, is a challenge.

“We’ve kept it fresh, and Civic has continued to do well,” he says. “I think we’ve got to keep efficiency. We’ve got to keep fun. We’ve got to keep safety – they are Honda attributes.”

In order to make the next generation model more appealing to a diverse group of buyers, Honda might use more trim levels, although Mendel is pleased with the variation of the Civic lineup now. This includes a coupe, sedan, hybrid and a multitude of trims, including the Si performance model.

However, a return of a Civic hatchback likely is not on tap.

“I think we’re probably going to stick to the existing concept of what (the Civic) is,” Mendel says. “I don’t know if we’ll go (after) the hatchback market at this point.”

Honda offered a Civic hatchback for most of the 1980s and part of the 1990s.

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