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Honda Restyles Civic Hybrid to Win Sales

June 17, 2005|From Bloomberg News

Honda Motor Co., the world's second-biggest maker of gasoline-electric autos, is redesigning its Civic Hybrid and improving the small car's fuel economy to try to win U.S. sales from Toyota Motor Corp.'s Prius.

The revamped Civic "will be a stronger competitor," John Mendel, sales chief of Honda's Torrance-based U.S. unit, said in an interview this week. "I think you'll see a vehicle that from a performance standpoint will be spot on or better than Prius. Better packaging, better safety."

Honda got an early lead in hybrid sales when its two-door Insight debuted in 1999, six months before Toyota brought the Prius to the U.S. The companies' annual sales of gas-electric cars were similar until 2004, when the revamped Prius outsold the Civic and Insight hybrids 2 to 1. Prius monthly sales this year averaged 8,737 through May, four times the hybrid Civic's 2,156.

"Prius is a unique car. It tells everyone you're driving a hybrid," while the gas-electric Civic looks like the gasoline-only version, said Brett Smith, an analyst at the Center for Automotive Research in Ann Arbor, Mich. "Honda made a complete, utter commitment to making the hybrid Civic a normal Civic. In that sense, they made a mistake."

The new hybrid model will have more significant differences in exterior and interior styling and options to distinguish it from the gasoline-only model, according to Mendel.

"It won't be as different from a conventional Civic as Prius is from a [Toyota] Corolla," Mendel said. "There will be a couple of unique colors only for this model and we will identify it better as the hybrid version." He did not elaborate.

Mendel also said Honda would boost the fuel economy, without saying how much.

The Environmental Protection Agency estimates that the Civic Hybrid travels 50 miles per gallon in combined city and highway driving. The agency rates the Prius at 58.8 mpg.

Tokyo-based Honda also is redesigning the gasoline-only Civic. The revamped gasoline-only sedan and coupe will reach dealers in September, with the hybrid version available late that month or in October, company spokeswoman Sara Pines said. The revamped cars will be 2006 models, produced mainly for North America at plants in East Liberty, Ohio, and Alliston, Canada, in the province of Ontario.

The automaker now builds all of its hybrid models in Japan.

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