Honda hits headwinds

Honda Executive VP Tetsuo Iwamura

Honda Executive VP Tetsuo Iwamura

Every three months, Honda is first among Japan’s major automakers to report the numbers for the quarter. It sets the tone for the presentations of its peers. Today was the day to go to Aoyama-Itchome in Tokyo, and to hear that business isn’t bad, but not rosy either. Honda is still making plenty of money, but less than expected.

Why? [Continue Reading]

Japanese automakers: The currency party is over

Honda - Picture courtesy Bertel Schmitt

A year ago, Ford execs all the way to Mulally riled against a weaker yen, saying it gives Japanese automakers an unfair advantage. Indeed, when the abnormally strong yen came back to acceptable levels later in the year, profits of Japanese automakers surged. That party appears to be over. Yesterday, Nissan reported no appreciable currency effects on its earnings. Today, Honda reported same. [Continue Reading]

Japan’s automakers join ranks to ease grid anxiety

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Dares to question the viability of the battery-powered vehicular motion,  and makers of electric vehicles will raise their hands and point fingers at the haphazard charging infrastructure. A last year’s Tokyo Motor Show, Nissan’s Carlos Ghosn said that there is no range anxiety. There is an anxiety that there is no place to charge when the range is exhausted, he said. Instead of waiting for the chicken to come out of the egg, Japanese automakers are getting together to do something about it. [Continue Reading]

Japan’s January car sales best since 1997 – will deflate when new taxes kick in

Honda HQ in Tokyo

Honda HQ in Tokyo

Auto sales in Japan surged 29.4 percent year-on-year as consumers race to lock-in lower taxes. In April, the country’s sales tax rate will go to 8 percent from 5 percent, causing a boomlet as purchases of high ticket items such as cars, houses, and jewelry are pulled forward. [Continue Reading]

US Car Sales On Fire… But Who Is Doing The Buying?

Bought... but not paid-for.

Bought… but not paid-for.

With America’s Seasonally Adjusted Annual Selling Rate (SAAR) creeping  above 16 million units in November, driving the market to new post-bailout highs, the usual cheerleaders are out in force to celebrate the strength of the US auto sales. But in the rush to spread the good news, few are looking at the troubling data underlying these frothy sales numbers. In the US, automakers count sales upon delivery to dealers rather than consumers. When times get tough and demand shrinks, OEMs often force dealers to take on more inventory in order to temporarily improve sales numbers. We saw both GM and Chrysler dump huge amounts of inventory on dealers in the leadup to their 2008 collapses, and we’ve reported on a similar dynamic at play in the current European downturn.

We won’t know the extent to which dealers are stacking up inventory until we see a full December 1 report from Automotive News, but initial signs are not promising. Already in October, Wards Auto saw an uncomfortable build-up in inventories across the industry that has apparently only grown among the worst offenders. At the time Wards predicted that “the excess will be alleviated in November, when most of the lost sales are recouped,” but although pricing discipline has remained high the inventories are continuing to build as we head into December.

[Continue Reading]

Abe beats Obama in game of chicken – Japan’s METI behind driverless car development

Look, Abe-san, no hands!

Look, Abe-san, no hands!

Remember when President Obama was sitting in a Chevy Volt, and the Secret Service would not allow him to drive? Even after he pointed out that as the President of the United States of America, he owned the damn company? No dice. Obama’s Japanese colleague, Prime Minister Shinzo Abe, showed much more confidence into the products of the Nipponese industry. Abe today drove around in an autonomous car today. One? What am I saying, three!
[Continue Reading]

J.D.Power: “Chinese domestic brands achieve tremendous improvement.” Beat Buick, Chevrolet, Ford, Nissan, Honda in IQS

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Chinese cars have long been derided as dangerous contraptions that would not stand a chance on the world markets. Graybeard industry insiders warned that that’s what they said about Japanese cars back in the Sixties, and that’s what they said again about Korean cars a few decades later, and look where they are now. Erudite graybeards sometimes predict that when the Chinese finally turn the quality corner, that process will be much faster than in Japan and Korea.

These warnings are commonly ignored, and – hubris comes before the fall – they will continue to be ignored until it will be too late, yet again. Chinese cars are quickly getting better, they receive stars at NCAP, and today, a usually ignored Chinese carmaker, and a brand with a droll name, did beat reputable global brands in the closely watched J.D.Power 2013 IQS.    [Continue Reading]

Honda cars to come with built-in valet parking

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At the 20th World Congress On Intelligent Transportation Systems, to be held next week in Tokyo,  carmakers will show self-driving cars, or cars on their way towards self-driving cardom, or not-quite-ready for self-drive technology, packaged  as driver-assist. Honda will show something we love a lot at the Daily Kanban: Valet parking. Automated valet parking. [Continue Reading]