Five New Cars Released in Total for First and Second Half
Fixed Pricing System Implemented Through Online Platform
"Electric Vehicle Launch Expected to Take at Least 3 Years"
[Asia Economy Reporter Oh Gyumin] Japanese automaker Honda held its first public media event since the No Japan (boycott of Japanese products) movement and revealed its blueprint for this year. The company plans to recover from sluggish performance through the launch of completely redesigned Accord and CR-V models and enabling online purchases for all vehicles.
Lee Ji-hong, CEO of Honda Korea, is discussing this year's business plans at the New Year's Media Day on the 11th. [Photo by Honda Korea]
Lee Ji-hong, CEO of Honda Korea, stated at the New Year Media Day on the 10th and 11th, “Starting with the full-change CR-V model in the warm spring, we plan to launch two new cars in the first half and three in the second half of the year.” Both the existing CR-V gasoline and hybrid models will be completely revamped. The CR-V recorded sales of 1,274 units last year, making it the best-selling Honda vehicle (total sales of 3,140 units). Honda also plans to introduce new gasoline and hybrid Accord models by the second half of this year.
Honda aims to boost sales through these new model launches. The four models currently sold domestically (Accord, CR-V, Pilot, Odyssey), released around 2021, failed to attract consumer attention. The overlapping impacts of the COVID-19 pandemic and the No Japan movement resulted in poor performance. The Korea Imported Automobile Association reported that Honda’s sales last year were similar to 3,056 units in 2020 when the No Japan movement began, falling far short of the 8,760 units sold in 2019.
Honda will implement a fixed pricing system by moving all vehicle purchases online. The company has invested 5.5 billion KRW to develop an online platform. After two years of consultations with dealers, vehicle prices, which previously varied depending on discount rates, have been unified online. The platform allows test drive reservations and vehicle purchase contracts. Customers can view the inventory and delivery dates of the desired model at a glance and choose their preferred delivery location. During the purchase process, ‘Honda Curators’?professionally trained staff?provide real-time guidance services such as monitoring vehicle delivery dates. Offline stores will be transformed into spaces where customers can experience Honda vehicles.
The Korea Imported Automobile Association stated that last year's Honda sales were at a level similar to 3,056 units in 2020, when the No Japan movement began. This is less than half of the 8,760 units sold in 2019.
A committee will also be formed to prevent excessive competition among dealers. According to CEO Lee, both dealers and headquarters agree that price wars ultimately amount to “cutting their own throats.” The committee, composed of four Honda Korea headquarters members and eight dealers, will conduct self-regulation activities to eliminate the harms of excessive competition.
At CES 2023, the world’s largest electronics and IT exhibition, Honda Korea stated that launching a subscription service by the Sony-Honda joint venture in Korea is difficult. Due to current regulations, subscription services are only possible through rental car or lease companies, so legal revisions are necessary.
Honda also expects it will take at least three years to launch electric vehicles. CEO Lee said, “Honda plans for 40% of vehicles sold in advanced countries by 2030 to be electric vehicles, and we will follow that schedule. We plan to launch electric vehicles in 2026, but even if it is later, we will not rush.”
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