Honda Wants Owners For Life

MAKUHARI, Japan, Oct 22, 2003; Reuters reported thhat a senior official at Honda Motor Co said on Wednesday he wanted to raise the ratio of repeat customers in Japan to 70 percent of its total buyer base from the current 60-plus percent. In stark contrast to its industry-beating performance in the U.S. market, Honda has suffered a big sales fall at home this year as rivals Toyota Motor and Nissan Motor flood the stagnant market.

Analysts have blamed a dearth of new models and a lack of new investment in its showrooms for Honda's problems.

Manabu Nishimae, a director in charge of domestic car operations, told Reuters in an interview on the sidelines of the Tokyo Motor Show that the retention rate had slipped recently along with sales and that was a cause for concern.

But, based on past performance, he was optimistic the trend could be reversed.

"The customer retention rate has clearly risen over the past five and 10 years," he said.

"At above 60 percent, we're approaching Toyota's level of over 70 percent and we aim to get there at some point."

Sales at Japan's No.2 auto maker have fallen by double-digit percentages compared with year-ago levels for most of this year and are down 21 percent in the year to date.

To remedy that, Nishimae said Honda would focus on strengthening its core minivan and minivehicle segments, while introducing new models into areas of the market it had neglected up to now.

One such model would be the "ASM" eight-seater minivan, a hybrid version of which was unveiled to the press on Wednesday at the motor show.

Honda said the model would go on sale in Japan early next year, although it has not said whether the vehicle would have a gasoline-electric hybrid or the conventional gasoline engine.

Honda launched a fully remodelled version of its Life minicar last month and the all-new Odyssey last week.

Nishimae said Honda was also hiring more sales staff and opening more dealerships to help boost domestic sales.

On Tuesday, Honda President Takeo Fukui said he expected domestic sales to rise in October for the first time in 10 months, helped by the recent launch of new models.