Honda 2007 Annual Report Download - page 24

22
1,000
800
600
400
200
003 04 05 06
Source: The Association of European
Businesses (AEB)
Foreign brands
Purely domestic brands
(Thousands
of units)
Rising Sales of Foreign Brands
in the Russian Market (Year)
20,000
15,000
10,000
5,000
001 02 03 04 05 06
3
2
1
0
*
1
Eastern Europe: Poland, the Czech Republic,
Slovakia, Hungary, Bulgaria,
Romania, Croatia, Slovenia,
Estonia, Latvia, Lithuaania,
Belorussia, Russia
Source: Eastern Europe: Global Insight
Western Europe: Association Auxiliare de
l’Automobile (AAA)
Eastern Europe*
1
(gasoline vehicles and diesel-powered cars)
Western Europe (gasoline vehicles)
Western Europe (diesel-powered cars)
Honda’s share
(Thousands
of units) (%)
Total Passenger Car Demand
and Perecentage of
Diesel-Powered Cars (Year)
4,000
3,000
2,000
1,000
001 02 03 04 0605
Number of Registered Vehicles in Major European Countries (The Growing Russian Market)
Germany
The United Kingdom
Italy
France
Russia
Spain
Central Europe*
3
*
3
Central Europe: Poland, Hungary, the Czech Republic, Slovakia
(Thousands
of units)
Source: European Automobile Manufacturers’ Association, Global
Insight (figures for Russia for 2002~2006 and Central
Europe for 2002~2003)
350
300
250
200
150
100
50
0
02 03 04 05 06 07
Honda’s Unit Sales in Europe and
Percentage of Diesel-Powered Cars
80
60
40
20
0
Years ended March 31
(Thousands
of units) (%)
Others
FR-V
Jazz
HR-V
CR-V
Accord
Civic
Diesel-Powered
Cars
Automobile Business
3. Ongoing Demand for Diesel-Powered Cars in Western
Europe and Sharp Demand Growth in Eastern Europe,
Centered on Russia
In calendar 2006, total demand for passenger cars in Western Europe*2
came to approximately 14,620,000 units, up 1.8% from the previous year.
Germany—Europe’s largest market—experienced a 4.5% year-on-year rise
in demand, to approximately 3,470,000 units, as consumers sought to make
purchases ahead of a January 2007 increase in the value-added tax (VAT).
Demand increased in Italy and Spain against a background of strong
economic performance.
Further, demand for diesel-powered cars remained strong, helped by their
impressive fuel and power efficiency. This demand, as well as a growing
awareness of their environmental benefits, pushed diesels above 50% as a
percentage of registered passenger cars in calendar 2006.
Amid the emerging countries of Eastern Europe, as a producer of abun-
dant crude oil, natural gas and other energy resources, Russia continues its
rapid economic growth. In line with its strong economic performance, in
fiscal 2006 passenger car demand in the country expanded 25.5%, to
approximately 1,870,000 units. Foreign brands increased rapidly in the
Russian passenger car market and gained a majority share of the market.
*
2
Western Europe: 15 EU countries (Ireland, United Kingdom, Italy, Austria, the Netherlands, Greece,
Sweden, Spain, Denmark, Germany, Finland, France, Belgium, Poland and Luxembourg)
and the 3 European Free Trade Association Countries (Iceland, Switzerland and Norway)
Honda’s unit sales in fiscal 2007 came to 327,000 units, up 14.8% from the
previous year. In Western Europe, the new Civic enjoyed positive sales, while
consumers also responded positively to the CR-V following its launch in
January 2007. Sales were also robust in Eastern Europe, propelled by a
doubling of sales in Russia, compared with the preceding year.
Since equipping the Accord with the first Honda-developed diesel engine
in January 2004, we have expanded our lineup and sales of diesel-powered
cars. In fiscal 2007, diesel-powered cars accounted for 27.4% of unit sales
in this market, or 89,000 units. In fiscal 2008, we are targeting diesel-
powered car sales to exceed 100,000 units.
From a production standpoint, in February 2007 we responded to brisk
sales of the locally produced Civic and CR-V by beginning full-scale opera-
tions at our second U.K. plant. In addition, we shifted some of the mechani-
cal processes for manufacturing diesel engines from Japan to the United
Kingdom as part of our ongoing shift toward local production.