Honda 2009 Annual Report Download - page 29

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In calendar 2008, total demand in the United States*1 declined 18% from the pre-
vious year, to about 13,190,000 units. As a result of the increase in gasoline prices
in the first half of the year, a shift from light trucks such as large sports utility vehi-
cles (SUVs) and pickup trucks to the fuel-efficient smaller car segment continued.
However, by the latter half of the year, sales of compact cars and light trucks had
also dropped significantly. Especially from October, the market showed major
contraction as a result of the effects of the financial crisis on the real economy, the
deterioration in employment conditions, restraint in consumer spending, the
adoption of more stringent credit criteria by financial institutions, and other factors.
Under these circumstances, Honda aggressively introduced new models. In
the Honda channel, the all-new Pilot was launched in May 2008, the all-new Fit in
August, and the new Insight hybrid car in March 2009. Similarly, through its Acura
channel, model introductions included the all-new TSX in April 2008, and the all-
new TL in September.
Amid this business operating environment, Honda’s unit sales of its competi-
tive lineup of compact cars expanded in the first half of the year as gasoline
prices rose, while other automakers reported declining sales. In May 2008, the
Honda Civic took the number one spot for new car sales among all models on
the market.
However, along with the deterioration in the real economy, sales began to fall
in all segments, and, for the fiscal year, unit sales in North America as a whole
declined 19.1%, to 1,496,000 units. Although sales of the all-new TSX held firm,
due to its attractive price, sales of higher-priced models such as light trucks, the
Odyssey, the Pilot and the Acura MDX, as well as the Acura TL dropped sub-
stantially, reflecting decline in consumer sentiment and demand.
In the area of production, manufacturing of the Civic at the new automobile
production plant in Indiana started in October 2008, but because of the sudden
decline in demand, Honda had made production cutbacks at the major plants in
North America. As a result, automobile production declined 13.2% from the pre-
vious fiscal year, to 1,251,000 units.
*1: Source: Ward’s Auto
TSX (North America)
An entry-level Acura with sportier styling and easier handling
NORTH AMERICA
New factory in Indiana
Fit (North America)
A subcompact passenger car with a sporty ride, reflecting
close attention to design
TL (North America)
A luxury sedan offering a dynamic driving experience
Insight
(North America)
Annual Report 2009 27