Tag Archive | "Honda Motor Co."

Honda to Recall 18,000 ’11 Civics

Honda Motor Co. said it is recalling more than 18,000 2011 models over concerns the fuel tank could leak in a rollover crash and has halted the sales of some models.

Honda said the recall of 18,056 vehicles is to inspect and replace a part that could fail to prevent fuel from leaking out of the fuel tank and into the evaporative emissions canister in a rollover, reported The Detroit News.

The fuel pump module is equipped with a rollover valve but because of improper welding of the plastic case, it may break or crack, Honda said. Honda halted the sale of some Civic vehicles on Monday because of unrepaired vehicles on dealer lots.

The company told dealers on Monday “a stop sale is in effect for a limited number of 2011 Civic 4-door and 2-door models produced at the Canada and Indiana plants.”

Honda warned dealers that if they sold a vehicle on the stop sale list and “should an unrepaired vehicle cause an injury or damage because of the recalled item, the dealership will be solely responsible to the damaged party, and will be required to defend and indemnify American Honda for any resulting claims.”

The repair will require removal and inspection of the fuel tank unit. Replacement of the fuel tank unit will be required if the rollover valve case is cracked. Honda predicts just 1 percent of the fuel tank units will need to be replaced.

Honda said it has no reports of any fuel leaks from the condition, but its Southfield-based supplier Denso International notified it of some faulty rollover valves after it replaced parts on its ultrasonic welding machine in late October.

Denso changed its welding process in early December.

Honda will notify owners in mid-April.

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Toyota, Nissan, Honda Halt Japan Output

Japan’s leading automakers are suspending production at their domestic plants on Monday as they assess the condition of their factories and parts suppliers after Friday’s devastating earthquake and tsunami.

They did not say when they would resume production, reported The Detroit News.

Toyota Motor Corp., Nissan Motor Co. and Honda Motor Co. reported damage to more than a dozen plants and facilities, mostly in and around the hardest-hit Tohoku region more than 200 miles north of Tokyo.

Japan’s industrial heartland in the central part of Honshu island wasn’t hit as hard, however, by the quake and wasn’t struck by the tsunami that caused most of the devastation in the northeastern region and in parts of Hokkaido island, farther to the north.

Toyota’s big plants southwest of Tokyo were able to resume operations Friday, but the automaker is halting its domestic output for Monday as the country grapples with what Prime Minister Naoto Kan called the biggest crisis since World War II.

“Toyota has decided to suspend production at all Toyota Motor Corp. plants, as well as all subsidiary vehicle-manufacturing plants on Monday,” the automaker said.

On Friday, it reported damage at four subsidiary, or part-owned, plants in areas hit by the quake and subsequent tidal surge. The employees had been evacuated.

“We are now conducting a detailed survey of each plant to determine the extent of any damage,” Toyota said in a statement. “We are also assessing the situation at our suppliers, dealers and the impact on North American import vehicles.”

Two of the four affected subsidiary plants produce Scion xB and xD models, as well as small Toyota Yaris cars.

Nissan, Japan’s second-largest carmaker, also suspended production as it reviewed its operations.

“Our first priority on Friday was, are our people OK?” said Nissan communications and marketing director Simon Sproule. “What’s uncertain now is the extent of the damage to suppliers, particularly small suppliers in remote areas. That’s what we’re looking at now.”

As to when production will resume, Nissan said in a statement: “No decision has been made as we are continuing to assess the damage to our facilities and equipment, as well as discussing parts delivery with our suppliers.”

At least six of its plants suffered some damage to buildings and equipment, as did some of its facilities on the Pacific coast.

Nissan said 1,300 U.S.-bound vehicles were damaged at the port of Hitachi, north of Tokyo, and another 1,000 at the Miyagi Service Center suffered damage when the tsunami swept ashore.

Honda said its two main assembly plants will be closed Monday as well as several components factories. The Sayama plant, which turns out CR-V, Accord, U.S. Fit, Acura RL and TSX models, also was closed Friday. Honda’s Suzuka plant, which produces the Civic, Civic Hybrid, Insight and hybrid CR-Z, was operating on Friday but will be closed Monday.

Honda said the disruptions in Japan would not have an immediate impact on its North American operations, which produce 90 percent of the vehicles Honda sells in the United States. The majority of Toyota’s U.S. Sales also are produced in North America.

“It is too early to fully assess the implications of this week’s very tragic events in Japan,” Itay Michaeli, auto analyst at Citi Investment Research & Analysis, wrote in a report issued Sunday.

He said that out of the total annual Japanese vehicle exports of 4.8 million, more than 1.6 million are shipped to the United States.

“Key questions now include the extent of production shutdowns and related supply chain issues — conditions at ports, available air freight for outgoing components,” he said. “For now, Japanese automakers have roughly a 60-day U.S. supply of vehicles.”

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Honda Tops Magazine’s 2011 Car Rankings

Honda Motor Co. and several other Asian auto makers scored high marks in a series of new studies and rankings of new cars by Consumer Reports magazine.

Ford Motor Co. was on the only one of the three Detroit auto makers to make it into the top 10 in the publications annual auto maker score card for 2011, which was released on Monday. General Motors Co. and Chrysler Group LLC were placed twelfth and thirteenth out of 13 auto makers ranked in the April issue of the magazine, reported The Wall Street Journal.

Among other auto makers, Toyota Motor Corp. managed to keep its scores near the top of the rankings, despite the recall and quality troubles it has suffered in the past year. European car companies including BMW AG and Daimler AG’s Mercedes-Benz performed well in comfort and overall ride but lost points due to weak ratings for reliability, Consumer Reports said.

Honda had the top overall score of 74, and was followed by Subaru, Toyota and Volvo. Ford placed fifth with an overall score of 67. Hyundai Motor Co., Mazda Motors, Nissan Motor Co., Volkswagen AG and Mercedes rounded out the top 10.

The score card takes into account a variety of factors as measured by Consumer Reports, including on-road performance, reliability and fuel-economy.

Honda got a boost in its scores from the Fit subcompact, which was named the “best value” among small cars and the “best budget car.” Ford’s Mustang and Kia Motor Co.’s Sorento were among six new models added to the magazine’s annual list of best picks.

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Honda Ramps Up U.S. Sales

TOKYO – Honda Motor Co., buoyed by higher demand for more fuel-efficient vehicles as oil prices rise, is on track to surpass its target for U.S. sales growth of 10% in the coming fiscal year, the company’s leader said Thursday.

As the political turmoil in the Middle East has put the auto industry on edge with the prospect of higher pump prices, Honda President and Chief Executive Takanobu Ito sees an opportunity to gain a competitive advantage.

“We think it’s very possible that higher gas prices won’t hurt demand for cars so much as it will drive buyers toward more affordable, fuel-efficient cars,” Mr. Ito said in an interview with The Wall Street Journal.

He predicted strong demand for Honda’s Odyssey minivan, along with new versions of the Civic compact and CR-V small sports-utility vehicle, would push up U.S. sales volume more than 10% in the full-year starting in April from a year earlier.

That level of growth would surpass the 9% increase in U.S. unit sales projected by arch rival Toyota Motor Corp., which has said it expects to rebound from weak demand stemming from massive vehicle recalls in 2009 and 2010.

For the year through March, Honda, Japan’s third biggest car maker by volume, expects to sell 1.28 million vehicles in the U.S., making up the bulk of a forecasted 6% gain in profit to 530 billion yen ($6.5 billion).

On the 10th floor of Honda’s 16-story headquarters in the tony Aoyama district of Tokyo, Mr. Ito works at a small desk in an open room shared with the company’s 37 other managing officers. He is one of five officials with his own desk, the other officers share space at one of four oval tables with laptops.

The board room, just a few feet away, is getting less crowded after Mr. Ito cut the number of Honda’s directors to 12 from 20 earlier this month. The slimmed-down executive committee, which was announced on Tuesday, is designed to allow for speedier decisions and deeper debate among the operating officers.

As real-time currency quotes flash on a nearby flat-screen panel, the blunt-spoken CEO says Honda is considering moving more of its production base to the U.S. if the dollar stabilizes at its current exchange rate of about 83 yen.

“With currency rates at these levels, we’ve switched exports of Mideast-bound Accords from Japan to the U.S., and we may do the same with other models such as the CR-V to that region and others,” Mr. Ito said.

The dollar would need to hit 100 yen before Honda would once again consider increasing Japan-based vehicle development for exports and production.

Earnings at Honda and other Japanese car makers have been hurt over the past several months by the yen’s strength against the dollar. Honda posted a 40% drop in profit for the three months ended in December.

But Mr. Ito said the damage to his company’s bottom line has been mitigated by the local production rate in North America—its biggest single market by sales—approaching 90%, the highest among any of the Big Three Japanese auto brands.

That could rise further if demand for vehicles such as the Fit subcompact or hybrids—now exported from Japan—rises above 100,000 a year. The CEO said that is the minimum level at which it begins to make sense to localize production.

Honda also is considering exporting more cars from China beyond those it already ships to Europe. Sluggish demand for the company’s Jazz subcompacts in the European market has pushed down capacity levels to 50% at its export-dedicated plant near the southern Chinese city of Guangzhou. Honda built about 25,000 Jazz models for Europe in 2010, half the Chinese plant’s maximum annual output potential of 50,000 vehicles.

Looking ahead, Mr. Ito, who became Honda’s president in 2009, said a lot is riding on the successful debut of the next-generation Accord midsize sedan, its second biggest selling model globally. The latest version of the No. 2 best-selling car in the U.S. is due in 2012, but it faces a stiff challenge from restyled versions of Toyota’s Camry and Hyundai Motor Co.’s Sonata.

Honda will seek to differentiate itself in the midsize-sedan market by delivering cars with more miles per gallon than the competition. “The clincher is fuel economy,” Mr. Ito said. “So our goal is clear: we need to be best in class.”

In addition to the new gas-fueled Accord, Mr. Ito said that Honda would re-introduce a hybrid version of its mainstay mid-size sedan shortly thereafter with a new hybrid power train. The company withdrew its previous Accord hybrid model in 2007 after weak sales blamed on an underpowered engine.

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Honda Recalling 700,000 Vehicles For Engine Problems

WASHINGTON – Honda Motor Co. is recalling nearly 700,000 Fit and other compact vehicles around the world over concerns the engine could stall.

The recall includes 97,201 2009-2010 Fit vehicles sold in the United States, the Japanese automaker told federal regulators.

The recall also covers versions of the vehicle sold as the Freed and City in markets around the world. Honda said the problem stems from a spring in the engine that can crack and cause noise – and in a worst case cause the engine to stall without the ability to restart it. That could increase the risk of a crash, reported by The Detroit News.

Honda said it got its first complaint of engine noise in July 2008 from Japan and got the first claim of an engine stall in North America in August 2008.

In January 2009, Honda said it determined the problem wasn’t serious enough to demand a recall.

“The occurrence trend of the failure was low and vehicles could be stopped safely, so (Honda) determined market action was not necessary, and implemented one year market monitoring,” the company told the National Highway Traffic Safety Administration.
In November 2009, Honda changed the specifications of the spring to prevent future problems.

But in June 2010, Honda noticed an uptick in problems of vehicles at least a year old, which prompted Honda to reopen its investigation.

Honda said recall notices to U.S. owners will be sent starting March 7.

The company will inspect and replace, if necessary, lost motion spring assemblies.

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Honda Reports 40 Percent Drop in Profit

Honda Motor Co. on Monday reported a drop in quarterly profit because of the strong Japanese yen, but it raised its full-year profit forecast in anticipation of further growth in U.S. auto sales.

Honda, Japan’s third-largest automaker, predicted net income for the fiscal year ending March 31 would nearly double to 530 billion yen, or $6.2 billion, from last year’s weak levels, reported The Detroit News.

But for the fiscal third quarter ended Dec. 31, Honda’s income slid 40 percent to 81.1 billion yen, or $995 million, despite its cost-reduction efforts.

Honda said its research and development and administrative expenses rose, but it attributed the decline in earnings mainly to a rise in the yen to near-record levels. A stronger yen increases the cost of making vehicles in Japan and reduces the value of export earnings.

Since April 1, the start of the Japanese fiscal year, the yen has appreciated to trade at 87 to the dollar, on average, from 93 yen the previous year. For the full year, Honda estimates the exchange rate will average 85 yen to the dollar.

The automaker said the yen’s rise wiped 45 billion yen, or $550 million, off of its third-quarter operating profit, which was down 29 percent at 126 billion yen, or $1.5 billion.

Noriyuki Matsushima, a Tokyo-based analyst at Citi Investment Research and Analysis, said Honda’s operating results were “a positive surprise.” Though dented by the strong Japanese currency, they were substantially ahead of his estimates.

Despite the yen’s rise against the dollar, Honda expects to benefit from a recovery in the U.S. auto market. It accounts for close to 40 percent of Honda’s auto sales.

In the year starting April 1, Honda expects U.S. vehicle sales to rise as much as 10 percent, Honda Executive Vice President Koichi Kondo told reporters in Japan.

The automaker recently launched an all-new Odyssey minivan and is rolling out more new models for the U.S. market, including a redesigned Civic compact coming out in spring.

Honda’s auto sales rose in North America during the third quarter but fell in the weak European market and in Japan, where demand dropped after the expiration of a subsidy program similar to “cash for clunkers.”

Overall, Honda’s auto sales fell 6 percent in the third quarter to 885,000 vehicles. Its motorcycle sales rose 22 percent to 2.9 million units, and power product unit sales increased 16 percent to 1.16 million.

Honda is the world’s leading motorcycle and engine manufacturer but fell behind Nissan Motor Co. in auto sales during the 2010 calendar year to become Japan’s third-largest carmaker.

Honda sold 3.6 million vehicles last year, while Nissan sold 4.1 million. Toyota is the world’s largest automaker with 8.4 million vehicles sold in 2010.

Toyota is scheduled to report its third-quarter earnings on Feb. 8, and Nissan on Feb. 9.

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