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Honda to stay with slow-selling Insight, says no hybrid SUV

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Honda to stay with slow-selling Insight, says hybrid SUV not in 3-year plan

YUZO YAMAGUCHI | Automotive News
Posted Date: 1/4/05

TOKYO -- Honda Motor Co. has no plans to remodel the poor-selling Insight hybrid.

But it has no plans to kill the two-seater, either, says President Takeo Fukui, because it is the most fuel-efficient car sold in the United States.

"That's an image car with the top fuel economy," he says.

The Insight's U.S. November sales numbered only 5, down from 39 a year earlier. For the 11 months of last year, Honda sold only 575 Insights, a plunge from 1,124 in the year-ago period.

The car was launched in 1999 to demonstrate Honda's fuel-saving technology. It is powered by an electric motor and a three-cylinder gasoline-powered engine.

With a five-speed manual transmission, the Insight achieves 61 mpg in the city and 66 mpg on the highway. That tops the Toyota Prius' 60 mpg in the city and 51 on the highway.

The Prius, which was launched in 2000, has been embraced by environmentally conscious Americans. In the first 11 months of this year, Toyota sold 47,704 Prius units in the United States, more than double the number sold in the same period of the previous year.

Hybrid SUV not in 3-year plan

Unlike Toyota Motor Corp., Honda Motor Co. has no plans to build hybrid SUVs in the next three years.

"For now, we are not thinking about it" for the three-year plan starting in April, says Honda President Takeo Fukui.

SUV owners care little about fuel economy, Fukui says. "If they look for fuel efficiency," he says, "they could shift to a car."

Fuel-efficient hybrids use gasoline- or diesel-powered engines teamed with an electric motor.

Honda sells the Insight, the company's first hybrid, and hybrid versions of the Accord and Civic.

Fukui added that a hybrid powertrain is "an extremely expensive system," and that Honda can devise cheaper alternatives to save fuel in vehicles. For example, the Odyssey and the hybrid Accord use cylinder deactivation. The 3.5-liter V-6 engine runs on all six cylinders when accelerating and three when cruising.

Honda's reluctance to offer hybrid SUVs contrasts with Toyota's plans. The Lexus RX 400h hybrid is scheduled to go on sale April 15, and the Toyota Highlander hybrid is scheduled to go on sale in June.
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What kinda business is Honda running?

According to the article (
, thanks Rai Ka), Insight's sales are pretty crappy.

There has GOT to be something going on. Honda is NOT going just let their sales flounder. My guess is they are doing 1 of 3 things:

1) Smoke and mirrors (thanks, Citrus Smoothie). They're intentionally deceiving us as to their plans for the Insight, because they don't want us to know too much too soon. If this is the case, then they're probably not discontinuing it.

2) They are putting their eggs in the Accord/Civic basket. If this is the case, then they are very much planning to discontinue the Insight, but they don't want to start the ball rolling until someone tops their "my car has the best fuel efficiency in the world" bragging rights.

3) They just don't know what to do with it. Fuel efficiency is all the talk right now (just look at Ford's Escape sales), so the Insight has given the market something to talk about. By the same token, when you think about it, a 2 seater isn't that practical. Practicality is still king over fuel efficiency, and most 2-seaters are turbo-charged and are meant to fit the stereo-type "fast and little" car. Insight is little, but doesn't have explosive performance. If this is the case, then Honda might be waiting to see what happens in the market.

In general, it is expensive to keep a low-selling oddball product on the shelf, even if you do have bragging rights, but if the fuel prices climb too much higher, a redesigned Insight might be a goldmine. The REAL question is: How long can Honda afford to wait?
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