Thai flood cri­sis

Herald Sun - Motoring - - Front Page - CRAIG DUFF craig.duff@cars­

It took Thai­land’s mas­sive floods to make it hap­pen, but for now at least Hon­das will come from Ja­pan once more

A DES­PER­ATE need to put its cars on Aussie show­room floors is forc­ing Honda to take a hit on prof­its by im­port­ing the pop­u­lar Jazz and Civic cars from Ja­pan.

Honda’s Thai­land plant— re­spon­si­ble for about 80 per cent of Hon­das sold here— was in­un­dated in the re­cent floods and the com­pany this week gained ac­cess to the plant for the first time since Oc­to­ber 4.

It is pre­dict­ing an April startup at the site but in the in­terim, Honda Aus­tralia is sourc­ing stock from wher­ever it can and jug­gling low-stock vol­umes. Com­pany spokesman Lind­say Smal­ley ad­mits the move to im­port cars from the Suzuka plant will hit prof­its but adds it is nec­es­sary to pro­vide ve­hi­cles for its cus­tomers and deal­ers.

‘‘ The ris­ing value of the yen and the fact our Thai-built cars ben­e­fit from the free-trade agree­ment ob­vi­ously will have

Things have be­come so tough for Honda, it’s re­sorted to sourc­ing cars from its home­land

an im­pact,’’ he says. ‘‘ We are for­tu­nate that Honda New Zealand al­ready takes cars from Suzuka, so the cars are be­ing built to ADR (Aus­tralian De­sign Rule) stan­dards. We still need to have them ap­proved for lo­cal sale and that is hap­pen­ing now.’’

Honda Aus­tralia di­rec­tor Stephen Collins says that at times this year, it has only had around 200 ex­am­ples of some mod­els in the coun­try.

’’ When you spread that num­ber around our 107 deal­ers, we’ve had to be fairly care­ful in deal­ing with stock but we’ve man­aged it as best we can and there’s fi­nally an up­side,’’ he says. ‘‘ It’s been a tough year and it’s fair to say that we’re look­ing for­ward to 2012.’’

Honda sales in Aus­tralia are down more than 25 per cent on last year, at 25,882, and Collins says the fi­nal 2011 fig­ure will be around 35,000.

Collins fore­casts 40,000 sales next year and Smal­ley says it will take three years to re­turn to Honda’s 2007 hey­day when the com­pany sold more than 60,500 ve­hi­cles.

‘‘ At nat­u­ral growth it will take around three years, but some­times car com­pa­nies can do things to ac­cel­er­ate that,’’ he says, im­ply­ing Honda will ag­gres­sively cut prices and add fea­tures when pro­duc­tion re­turns to nor­mal.

‘‘ I think the speed we re­cov­ered from the earthquake and tsunami in Ja­pan shows the re­silience and ded­i­ca­tion of our work­ers and that will be the same in Thai­land,’’ he says.

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