Thai flood crisis
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.