Honda drops the Hybrid Accord, Learns its Lesson

Honda politely and quietly informed the press that the Honda Accord Hybrid is being phased out.  When asked why, the CNN reporter got this paper-thin explanation (which didn’t even hold up through the interview):

“We have found that our hybrid system works better on smaller cars,” said Chris Naughton, a Honda spokesman.

Whatever, Mr. Honda Spokesman (if that is your real name).  The truth is economic, not mechanical: the HAH didn’t sell. 

Honda’s more-power-less-mileage sales formula for hybrids (“muscle hybrids”, Treehugger called it), and its failure to find customers, is a lesson that helps us see where the hybrid market is going. 

Call a flop a flop: so far this year, Toyota’s on pace to sell almost 250,000 hybrids, between Priuses (Prii?) and Camrys (Camries? Camryses?), while Honda will probably need to use incentives to move even 5,000 of the HAH.  Even Accord buyers can’t be moved over to the hybrid version, while on the other hand 1 in 6 Camry buyers choose that option.

It looked like a smart move on paper: marry hybrid tech to things general buyers usually like: a larger V6 engine, competitive horsepower, standard automatic transmission, etc.  No new jargon to learn (CVT?  anyone?), no tradeoffs to debate (except the cost differential), no subtle hurdle of “am I really a hybrid driver?” to overcome.  It might have been the Wii of hybrid cars, bringing the mainstream buyer into contact with hybrid tech and getting rid of the dork factor.  A USA Today review proves there were at least some who liked that.  This guy lurved his HAH too, for those reasons.

So why’d it flop?  Partly market characteristics: the Prius got the jump start on everyone, and it has the market under control, after all, with half the US hybrid sales and no signs of slipping (May of this year was its highest sales month yet).  Here’s some sales figures from early 2007 — get your read on.

But the real reason is the nature of hybrid demand: hybrid small-car buyers are buying with a purpose.  They really want to maximize mileage, and toe-in-the-water compromises just don’t sell.  It’s a progressive, not cautious, crowd — the more CVT the better.  They repudiate typical cars as a “part of the problem.”  They’re participating economically in a revolution, or at least a protest.  Soultek articulates that view quite well.

This sincerity might impress some people, but we think the failure of a “bridge” hybrid bodes poorly for greens.  Greens seek a general culture shift, in which the whole country adopts changes that reduce our degradation of the world on which we depend.  By contrast, this foretells a split between a small core of car-buyers who care and a majority culture of those who don’t.  Considering how self-expressive car purchases often are, and considering that a big part of the skepticism people have about the green movement is really a fear of an unpleasant culture shift, the fall of the HAH means the Average American and the Green American are on opposite sides of a chasm that will be hard to cross.

But greens can take reassurance, ironically, from SUV sales.  The approach that failed so starkly in the Honda Accord Hybrid is working like gangbusters in the SUV market — gas-electric versions of the Ford Escape, the Lexus SUV, and the Toyota Highlander all had solid sales numbers, despite wobbly mileage figures.  SUV buyers clearly bring the mindset Honda was hoping would be present in car buyers — they’re buying based on non-green motivators, and considering hybrid tech like an add-on.  While the world would be better served by these folks buying more efficient vehicles, getting mainstream acceptance of the technology is valuable in itself.

Next up: the reason why GM is still never a part of this conversation!

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