Honda 2007 Annual Report Download - page 21

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19
Automobile Business
6,000
4,000
2,000
001 02 03 04 05 06
Registered vehicles
Mini-cars
Honda’s share
Source: Registered vehicles: Japan Automobile
Dealers Association
Mini-cars: Japan Mini Vehicles Association
15
10
5
0
(Thousands
of units) (%)
Total Japanese Market Demand
by Category (Year)
1,000
800
600
400
200
0
02 03 04 05 06 07
Years ended March 31
Registered vehicles
Mini-cars
Honda’s Unit Sales
(Thousands
of units)
Models Introduced in
Fiscal 2007
Stream
CR-V
Elysion Prestige
Crossroad
7.0
6.5
6.0
5.5
5.0
96 97 98 99 00 01 02 03 04 05 06
5.0 5.1
5.3
5.6
5.8
6.0
6.2
6.4
6.6
6.8 6.9
* Average vehicle age: Number of years between initial new vehicle registration and
March 31 of each year for cars currently in use
Average Vehicle Age* (growing longer annually)
Source: Automobile Inspection & Registration
Information Association
(Years)
1. Japanese Market Affected by Declining Birthrate,
Aging Population and Shifting Consumer Preferences
Total automobile demand in Japan in calendar 2006 declined roughly 2%,
to approximately 5,740,000 units. Various manufacturers launched new
mini-car models, which pushed demand in this segment up 5.2%, to
approximately 2,020,000 units. Demand for registered vehicles, however,
decreased 5.4%, to approximately 3,720,000 units.
Bolstered by the introduction of the Zest at the end of the preceding fiscal
year, Honda’s sales of mini-cars grew 16.8% in fiscal 2007, to 283,000
units. Conversely, registered vehicle sales dropped 12.6%, to 408,000 units,
impacted negatively by a harsh market environment despite favorable sales
of the Stream and CR-V following full model changes.
Given such ongoing issues as an aging population, a declining birthrate
and increasingly diverse consumer preferences, as well as the trend toward
a longer average period of car ownership, market conditions are expected
to remain severe. Against this backdrop, the Fit—Honda’s highest-selling
mass production model—will undergo a full model change in fall 2007,
in the effort to ensure that the vehicle retains its appeal. At the same time,
Honda will endeavor to provide services to its 9 million existing customers
to ensure that they enjoy the full automobile ownership experience.