Car buyers looking for a Honda Fit or Honda CR-Z are going to start having a harder time finding one. Honda has revealed that it is losing money on every model that it imports in the United States, which includes the Fit, CR-Z and Insight.
Car buyers looking for a Honda Fit or Honda CR-Z are going to start having a harder time finding one. Honda has revealed that it is losing money on every model that it imports in the United States, which includes the Fit, CR-Z and Insight. The current exchange rate is making it harder for Honda to make any money on the cars that it imports into the U.S., so Honda is going to start carefully allocating inventory here. Honda CFO Fumihiko Ike told Automotive News that shipments won’t be stopped completely, but Honda needs to limit the units it allocates to the U.S. to minimize the impact of such shipments on its balance sheet.
Even though Honda continues to lose money on the imported models, the main reason that Honda hasn’t cut off shipments altogether is to keep certain segments covered and to retain customers. The long term solution to fix the problem would be to move more production to North America. Currently Honda builds 85 percent of the vehicles in the U.S. that it sells here. This compares to only 70 percent for competitors like Toyota and Nissan. Honda has already announced plans to build the Honda Fit at a new plant in Mexico in 2014.
Automotive News
