Mendel Sees Need for Honda Sports Car; Defends CR-Z, Civic

A top American Honda Motor Co. Inc. official says it is a question of “when” not “if” the auto maker will again retail a sports car, a segment it abandoned two years ago when parent Honda Motor Co. Ltd. nixed the S2000.

While saying Honda has made no announcements about an S2000 replacement, American Honda Executive Vice President John Mendel believes the brand’s U.S. lineup “absolutely” needs such a model.

“The question is never if, but when,” he tells select media in a recent roundtable interview. “(But) I think it certainly doesn’t make any sense to look at a vehicle like that unless you can bring it out (and) it’s consistent with where you’re going overall.”

Since nixing the rear-wheel-drive S2000, one of the sportier models in Honda’s current U.S. lineup is the front-wheel-drive CR-Z 2-seat sport hybrid-electric coupe.

Mendel defends the CR-Z, which went on sale last August, from negative headlines. He says it is “not a flop,” as sales are pacing 15,000 units per year, the level Honda targeted.

Ward’s data shows CR-Z sales tallied 5,249 units in 2010.

“If you do the math on that as I do with the dealers, that’s 15,000 divided by 1,000 Honda dealers,” Mendel says. “That’s 1 3/8 (sales) a month.

“Dealers are selling them just fine,” he adds. “They thought they would do 20 (CR-Zs per month) when we told them they would do 1.5.”

Honda S2000 discontinued in ’09.

Honda hinted last year a non-hybrid version of the CR-Z, which has three driver selectable modes including “Econ” and “Sport,” may be in the offing.

While the auto maker is getting “a lot of requests” from dealers and customers for such a model, it has nothing to announce at this point, Mendel says.

He also coy is about a 200-hp, high-performance version of the CR-Z similar to two concepts shown at last year’s Specialty Equipment Manufacturers Assn. show in Las Vegas: the CR-Z Hybrid R Concept and CR-Z Racer.

“If you think about it, CR-Z two years ago was a flight of fancy,” Mendel says. “(A) nice design exercise but too cool to build. And here it is today. So who knows?”

One car that isn’t a flight of fancy is the Civic Concept displayed earlier this month at the Detroit auto show. It foreshadows the exterior design of the upcoming ninth-generation production ’12 Civic, on sale in the U.S. this spring.

If the Civic Concept looks familiar, that was no accident, Mendel says, noting Honda didn’t want to mess too much with the eighth-generation Civic’s winning formula.

“The current design as voted by the customer wasn’t too broken,” he says, referencing the Civic’s status as the No.1 retail compact of 2010, despite 5½ years on the market in its current form.

“So I think losing the form of the car and going to something completely different – I don’t think we had to do that,” he says. “It was not a bad shape. The kind of mono form, one-flow design still stays there. But I think what you see are crisper, more accentuated lines in the car, which gives it a little more edge.”

He calls the front- and back-end of the Civic Concept coupe and sedan “clearly different” from the same body styles of the current Civic, but with “more detail on the sides.”

Honda is keeping most information about the new Civic under wraps, other than the ’12 Civic Hybrid gets a Honda-first lithium-ion battery. The natural-gas Civic GX will retail nationwide rather than in just four states previously, and at least a 40-mpg (5.9 L/100 km) fuel-economy rating can be expected for a “gas-engine” Civic.

A 40-mpg highway rating has become a marketing point for auto makers selling new compacts, notably Ford Motor Co. with its next-generation Focus compact, General Motors Co. with the Cruze Eco and Hyundai Motor America Inc. with the Elantra.

Mendel bristles at the notion the new Elantra’s arrival in the U.S. has anything to do with the ’12 Civic’s infamous delay.

The Civic’s 4-month delay was decided on in 2008, he notes, to make the car smaller and lighter to meet forthcoming, more stringent U.S. corporate average fuel economy regulations.

“(The Civic’s delay had) nothing to do with Hyundai. The new Sonata wasn’t out two years ago. The rest of the industry was going bankrupt.”

The Honda brand lost 0.5 percentage points of market share in the U.S. in 2010, the same amount the Hyundai brand gained.

But Mendel says Honda “didn’t give back any retail share” last year, noting the auto maker’s long-standing policy of not participating in rental-car fleets or “doing inordinate things to accomplish a market-share objective.”

He downplays Honda’s increase in incentives in 2010, which have been reported to be up to $1,563 per car from $1,276 in 2009.

Honda normally boosts incentives to offset falling sales of its older models, Mendel says, noting the auto maker still spends less on incentives on average than its competitors.

Edmunds.com’s True Cost of Incentives shows in 2010 the industry’s average incentive was $2,608 per vehicle.

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