Merry Christmas!

Merry Belated Christmas!!!! For He has come and live amongst us, and parted again for us. For the celebration of Christmas may just be for a day, the joy of Christmas is anytime.

Didn’t know it’s past Christmas really… For I didn’t get any holiday, so it’s work as usual…. Cheers people, I hope the joy of Christmas be with you all the time, not just for one day okay.

Honda CEO 2008 Year End Speech… The Interesting Stuff

Okay, 2008 is closing, and even though Honda posts record breaking profit by the middle of 2008, September came and hell along with the winter autumn breeze. Why hell? Hell… Everything plummet since September, everything that went up suddenly dropping like it was, I dunno, want to crack some joke but I think it’s futile anyway. Anyway…

When somebody wrote “The situation is worsening every day in all regions.” in their publicized company report… Then, probably it is. For 2009, Honda forecasts a drop in automobile and power equipment demands, but cited an increase in motorcycle demand. Well, it is given, when you can’t afford a car, you will buy a motorcycle (if you live in SE Asia).

“Unit sales forecasts are: motorcycles; 10.3 million units (+10.5%), automobiles; 3.65 million units (-7%), power products; 5.185 million units (-14.4%).”

The forecasts seems… Rather safe and heart lightening, however, when we look at the direction Honda is taking, I’m not so sure anymore. “

“• Toward this end, Honda will closely monitor the marketplace and then carefully determine what actions need to be taken. Once decisions are made, Honda will take quick action as the company realizes the situation is very urgent and a slight delay in making management decisions could be critical.

• Based on this understanding of the situation, bonuses for directors, corporate auditors and operating officers will be reassessed based on the business results of the current fiscal year ending March 31, 2009. In addition, monthly remuneration of directors, corporate auditors and operating officers will be cut by 10% for all directors starting January 2009.” Things are tough when the higher ups bonuses are reassessed based on the business results.”

Tough, because if the situation doesn’t improve, it’s up to the higher ups effort to maintain their bonuses, and in this uncertain economy condition… Well it’s safe to assume that Honda just want to cut its spending.

Okay, so enough of the preliminary, let’s just cut into the meaty part. So…

The darker side…

  • Honda is canceling the NSX project, along with it, the V10 and V8 engine destined to go to Acura.
  • As such, Acura launch in Japan is postponed.
  • So does medium to large diesel engines.
  • Not to mention quitting F1 and AMA.

The lighter side…

  • Honda will concentrate on small sized cars as forecasted will be the top selling model of 2009. Meaning no more waiting for the Fit on the dealers!
  • Hybrids are go, CR-Z is confirmed for 2010, and Insight V2 will be available early next year.
  • Focusing on small cars, Honda will introduce small size diesels and an unnamed small car positioned below the Fit/Jazz.
  • Honda will make available full electric scooter in 2 years time.

The Acura homeward bound cancellation is quite a shocker… But considering that it will take much more effort of time and money to introduce and maintain two separate brand, Honda best bet is just to keep Acura where it already established its business. When things are better, you can be sure Honda is going to take Acura home!

The NSX cancellation means a lot for everybody, Honda own NSX that races in SuperGT needs replacement badly… It’s the only naturally aspirated small block V6 on the grid. Fighting with the likes of large bore V8s of Toyota and super turbos of Nissan makes an easy opponent of Honda… Although the NSX is giving Toyota and Nissan a run for their money. NSX might not dominates anymore, but the extra decade old NSX still slots in on the top 5 at SuperGT… And sometimes manage a podium finish, not bad at all.

The V8 that is planned to go to Acura is another question mark. I would say Honda already have a blueprint for the engine, but just doesn’t want to produce it in quantity. Remembering the fact that new technology = retooling cost, and cost is the keyword that everybody is trying to avoid next year. Oh well, in the coming tough times, it’s good enough that people still buys a car.

One of the biggest interesting aspect of the year end report speech is the introduction of an unnamed small car that will be positioned below the Fit/Jazz. Is it the Life? Or better yet, Zest Spark? If it is, why wait 3 years? 3 years is quite a long time, the global economy slowdown might as well be relieved by then… Well, or perhaps Honda is waiting for its Chinese-partnership to bear fruits? The Li-Nian concept car is mighty fine… I wouldn’t mind driving a Chinese made Honda.

The all new Honda Zest Spark… Not released yet

All in all, Honda is bracing for a tougher times ahead, and there nothing to better close this post than taking it directly from the big man himself…

“Honda is a company driven to achieve continuous growth by the dreams and passions of each Honda associate. Especially when the company faces difficult times, each associate will maintain a high level of initiative and continue challenging.”

We will always challenge the future Fukui-san, we will always.


Official Honda CEO year end speech

Honda City: The New Heights of Excellence… Err… Pricing

Money burnt City
Have money to burn? Buy a City

Okay, so the new Honda City is out in Indonesia… Err… I wanted to pun about the new City is running around in the cities, but apparently it will not be the case for the longest time. As some has noticed (and taken it badly), the new City is priced at ridiculously-catastrophically-wallet-busting-high, towering more than 20% over its competitors, namely Toyota Vios, Suzuki SX4 Sedan (lovingly named Baleno locally), Chevrolet Kalos… And well, basically every small sedan out there.

The beard on fire joke maybe is overrated, but imagine this… A lot of people already pay a down payment for something that even doesn’t have a price! Now… Let’s think about it first…. Argh, just read through my silly writings. Witty comments in 3… 2… 1!

The new Honda City is officially priced starting from Rp. 239 million for manual version and as high as Rp. 260 million. Well, for the folks living stateside, the car costs a whopping US$20000 and topping US$23000 (current exchange rate) for the loaded version. Now why is everybody running around like they caught their beard on fire? Well, as most Asians, Indonesians are suckers for everything new (a.k.a. super early adopters)… That is, there are a lot of people who already pay the down payment for the new City even when they didn’t know the price… Now if that’s not a stereotype joke, I don’t know what is… Of course, much of Honda sales guys didn’t know about the price either as they really didn’t know even what the City would look like, so the silliness ensues.

People are targeting that even with Honda premium status, a new car will not be priced outside the “10% boundary” pricing wise against its competitors, or namely, the Vios here, as the reigning champion of small sedan. So, people expect the price at logically Rp. 210-220 million, as compared to Toyota Vios’s Rp. 201 million (fully equipped)… And you know what, the City is priced starting at 230 million. Still, it’s a little bit more or less on the target, but considering that the Rp. 201 million Vios is fully equipped, it’s starting to get hot in the competition, and in the people who pay for the down payment of the new City’s wallet.

People are accusing Honda Indonesia taking advantage of their “rising premium” status and jacking the price of the new City sky high. Well, perhaps those people are the one broken hearted as they couldn’t afford the new City, or just plainly uneducated… Bar none… I myself, is totally awestruck by the exponentially increased price… How? Why? But carefully thinking about it, it’s just too clear and easy actually, even my Honda crazier little nephew knows about it.

So why? Why indeed… Like my little nephew point to me, the new City looks like a totally new car… This is coming from a kid who said the last City and Baleno (Aerio Sedan) looked like a Jazz with ass and Aerio with ass… Really! He said that! A car with ass! Making sense of it all, the last generation City looks like the last generation Jazzz, with a trunk, a hatch with trunk, complete with gaudy rear end and questionable aerodynamics. Well, folks… BECAUSE IT IS! Last generation City took everything the Jazz/Fit is good for and added a trunk. The City’s front bonnet is sloped steep like the Jazz (from here on end, I will refer the Jazz to the Fit), making it look like, well, Jazz with less curve from the side profile… And with ass… I mean trunk. More over… The interior of the City looks exactly like Jazz! Once, I borrowed a friend’s City, as my prior car was the Jazz, I felt no difference at all between driving the old City and the old Jazz, and to put some insult… I almost rear end the car when backing up, because I swear, I thought I was driving a Jazz… You know, the car I had, has no ass… I mean trunk…

The origin of Jazz with ass comment... Straight from Honda

The original design for last generation Honda City… Short nose and long trunk…

Well, there’s no problem there in utility or cabin space. The last generation City is a haven to sit into, huge cabin space, tall, roomy, well, put every good spacious comments here and you have the last generation City. But all that goodness translates into something of an oddity. The tall cabin = tall car… A lanky design for a sedan… Why is it lanky again? Because the last generation City shares exactly the same A pillar from the last generation Jazz, the same tall A pillar that gives Jazz that small MPV looks… No wonder even a kid called it a Jazz with ass. Subjectively… The general public dish out on the last generation City styling, especially compared to the City 2 generation before (still heralded as the most beautiful City design).

So why the last generation City looked like a Jazz with ass? Well, this is called, platform sharing, the same as other Japanese automakers are famous for. The same as Civic is sharing its platform with CR-V, or Toyota Camry sharing its platform with Harrier/Lexus RX. However, it’s just too obvious and in ASEAN where the City is sold, sales are lackluster, because it just looks like a hatch with trunk. Honda even went the extra mile by (reportedly) making last generation City design refresh a costly one, changing the whole front side of the car.

Can you spot the difference?

From headlamp, bonnet, A pillar, body lines, door handles, it’s same ol same ol

But enough of that, now… Why is the new City costs literally an arm? Well, because my “Jazz with ass” nephew asked me… “is that the new Civic?” And you know what my reaction is? I TOTALLY LAUGHED!!! And gives a thumbs up to Honda design department, you’ve outdone yourself guys, the new City design is totally on the spot, it’s no longer a Jazz with ass, it’s now a proper small sedan devoid of clues from what car is derived upon. However things doesn’t bode well from pricing stand point… As you can see, platform sharing means sharing everything, from production to development cost. With the new City totally looks like a different car from the new Jazz, well, there’s bound to be something that incurs extra cost for the beloved H.

First of all, let’s take a look under the hood… Powering the car is the all new L15 engine, the freak 1.5L  120ps engine that debuted on the Jazz and just recently found its way on the new Honda Freed. Okay, let’s play count… That’s Jazz, 1, City, 2, Freed, 3… A grand total of 3 car that uses the same engine. Now compared with the old L15 engine that found its way on Jazz, Mobilio, Mobilio Spike, City, and Airwave, a complete line up of cars which warrants economy of scale. The new engine incurs new development cost, and also factory retooling costs for casting the new engine. To make matter more lively, Honda used an all new 5 speed automatic transmission complete with the black magic like grade logic control and turn shift (or whatever) technology… A 5 speed automatic transmission which has its competitions running dry (most of the competition still using “dumb” 4 speed automatic transmission, sans Toyota).

So under the hood, it’s a totally new experience. Compared to the same old VVT-I or the same old VVT of some cars (nudge*Toyota Yaris/Vios, Suzuki Aerio/Baleno/SX4/Swift).

Now, let’s take a look at the exterior side. Where the old City and Jazz shares almost everything, the new City and Jazz is different as night and day. Show me what part of the new City or Jazz (picture above) that shares any resemblance… I dare you… Now, show me what part of SX4 and Baleno that shares any resemblance… Okay, let’s not be cruel, but come on, SX4 and Baleno shares basically everything… Now my nephew even called Baleno the new Jazz with ass (as it is the same car with SX4 + trunk). Toyota does this with the new Yaris and Vios, but with better cladding and nicer retooling… You still can see similarities, but not as blatant as the new SX4 and its sedan version. Suzuki off course does it with reason, making the SX4 sedan (Baleno) as SX4 with trunk equals not much messing around in the factory floor, making economy of scale thaaaaaaaaaaaaaaaaaaaaaat much easier.

Everything is different, not a single similarity

Not a single damn thing is similar between the two cars

Now what of the new City? It doesn’t resemble a Jazz in any nights, even after hard frat party. It just different. The new Jazz might still looks like a mini MPV, but the new City just looks like a regular old sedan. Just look at those A pillars people! Now tell me if Honda Jazz was used as the base design for the City… Where in the Jazz you have that side glass next to the sideview mirror, the City has no such thing. Even the mighty Toyota designs Yaris and Vios A pillar with strong similarity. As we know, A pillars define the base model of a car that is derived from. Case in point, the SX4 and SX4 sedan shares exactly the same A pillar, and look what my nephew called the car (hint: above). If A pillar is not a strong enough indication… Look at the body lines… The line that goes from the rear door handles slopes toward the front of the car on the Jazz, where as it’s dead straight on the City.

So what’s on the inside? Yaris and Vios shares that funky center dashboard, SX4 and Baleno shares that simple and mysterious dash… But the new City? Does it share anything with the new Jazz? Well… No and No. Where the Jazz dash looks like a funky new age, or in short, a cheap miniature dash of the Civic, the City’s dash looks surprisingly different. Unlike the driver oriented dash design of the new Jazz, where each knobs are placed right next to the steering column, the City control knobs are placed dead center on the dash. City’s silver accented center dash also differs with Jazz’s straight simple center dash design… …So? So!? So, new dashboard means another shot on the economy of scale knee cap. No way in hell Honda will able to streamline two different dashboard molds under one production roof.

The simple hip Jazz dashboard is no match for... Err... Slightly upscaled Citys?

Up: Jazz, down: City, there’s similarity, but alot of distinction that garners a separation… Phew, that’s a tough sentence

So people… When you look at the City’s new design (and price), do remember… IT IS NOT a Jazz/Fit with trunk anymore, it’s a totally new car, a car made of mating Honda global small compact platform with the hopes of Honda fans all around the world… Errr… Around the world? Yup dear readers, Honda made the City a global car now. Our small ASEAN-Japan only sedan is now a global car, no longer exclusive for the squinty eyes (that’s a joke for Asians), Honda is selling the City to Europe and anywhere Honda could spread its hefty development and production costs.
In the end, City’s high price tag is attributed to several factors…

  1. New engine and transmission development cost.
  2. New design and factory retooling cost.
  3. The last… And this is just locally… High foreign currency exchange rate. The city is fully imported, and thus, with current global economy uncertainty, Honda shoot high currency exchange rate to protect its selling margin.

So… Is Honda to blame? All I see is that, Honda answers the critics by designing the City from the ground up. The high expense is just one outcome of that… Like the elders said, you can’t satisfy humans. If Honda wanted to cut costs, they could, and what will the city look like? A Jazz with ass again? Surely something that will involve another round of ridicules from the competitors and the general public. However, Honda does listens to its customers, and still they got a beating in the ass. To hell with nay sayers… If you can’t afford it, buy a tata Nano.

Edit: 23-12-2008 : I happened to stumble upon Paultan’s entry about Malaysian’s Honda City… Lo and behold! The car is actually more expensive there compared to Honda Indonesia City. Starting at 84980 Ringgit, and topping at 89980 Ringgit, it equates to 284 million Rupiah, much much more expensive than the 260 million Rupiah of Honda Indonesia most loaded City. Sure people are clamoring about Honda Thailand sells the City at about 220 million Rupiah, or 690 thousand Baht… But do you guys knows about local automotive taxes? Well… It’s expensive in some part of ASEANs…

Surely though, the fans and those who appreciates engineering will buy the City, although with slightly less smile, I’m sure. It’s when they experience the Honda quality and that particular Honda engineering, then, they will take noticed that every penny is worth it.

… Me? What I drive? I drive one of the car pictured above, and it’s not a Honda… I just have Hondamentalism.

Pictures are taken from Autoblog, Honda of Japan website and various sources