Honda sees U.S. sales comeback after dismal 2011

DETROIT Mon Jan 9, 2012 5:32pm EST

Members of the media look at the Acura NSX hybrid concept car during the first press preview day for the North American International Auto Show in Detroit, Michigan, January 9, 2012. REUTERS/Mike Cassese

Members of the media look at the Acura NSX hybrid concept car during the first press preview day for the North American International Auto Show in Detroit, Michigan, January 9, 2012.

Credit: Reuters/Mike Cassese

DETROIT (Reuters) - Honda Motor Co (7267.T) is looking to put a year of unprecedented difficulties behind it and boost sales in the United States, its biggest market, by a quarter in 2012, executives said on Monday.

Japan's No. 3 automaker suffered big disruptions to its supply chain both from the March 11 earthquake and tsunami at home and the historic floods in Thailand, leading to a plunge in production, sales and inventory in many markets.

In the United States, its sales fell 6.8 percent in a market that grew by 10 percent, as its North American production returned to normal only last month.

"We had a major handicap last year, but this year we're hoping to build up inventory to healthy levels in the first quarter and run full-speed at the latest from April," Honda North America President Tetsuo Iwamura told a small group of reporters at the Detroit auto show.

Honda is targeting a 25 percent jump to 1.43 million vehicles in U.S. sales this year, including a 46 percent rise for the struggling Acura brand to 180,000 vehicles.

Honda was also battered by poor reviews for the new Civic rolled out last year, with the influential Consumer Reports magazine ranking it second from the bottom among the small sedans that it rated.

Still, as production slowly returned in the final months of last year, Civic sales recovered in tandem, placing it back at the top of the compact sedan segment in the last quarter, Chief Executive Takanobu Ito said.

"A lot has been said about the Civic, but (the final quarter's performance) demonstrated to us the strength of our relationship with customers and the brand that we've built over the years," Ito told reporters in Detroit. "Of course, we need to polish our cars more, whether it's the Accord or the Civic."

Honda, along with all other established mass-market brands, has come under intense competitive pressure from Hyundai Motor Co (005380.KS), whose Civic-fighter, the Elantra, was crowned North American Car of the Year on Monday.

An aggressive comeback strategy from U.S. auto giants General Motors Co (GM.N) and Ford Motor Co (F.N) will also add to the pressure, with Ford on Monday unveiling a revamped Fusion aimed at ending the dominance of Toyota Motor Corp's (7203.T) Camry and Honda's Accord in that segment.

Honda's Accord will be fully remodelled with the automaker's new generation of fuel-efficient powertrains later this year.

(Reporting by Chang-Ran Kim, editing by Matthew Lewis)

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