Honda's Thai unit lifts sales forecast by 5%

The company, now placed second in the passengercar segment after Toyota, earlier forecast that its car sales would reach only 80,000 units this year.

In the first six months, Honda sold 39,967 vehicles, accounting for 39.4 per cent of the passengercar market.

The firm now predicts it will sell an extra 4,000 cars, as more customers are turning to smaller models such as the City, Jazz and Civic.

"The government's efforts to boost economic activity are also helping sales, and the economy is starting to recover. Many people who would normally buy pickups are now considering passenger cars instead, due to the fuelefficiency factor amid rising oil prices," Atsushi Fijimoto, president of Honda Automobile (Thailand), said yesterday.

Fijimoto said he expected the shift from pickups to passengers cars to be longlasting and for the uptrend to be more prominent in the coming years.

The overall automobile market for the first six months of the year was 230,000 units, a 28percent drop from the same period last year.

Both Toyota and Honda believes fullyear sales will be 480,000 units, of which 43.75 percent or 210,000 units are expected to be passenger cars and the remainder pickups.

Meanwhile, Fijimoto insisted that Honda's ecocar investment plan remained on track, although the size of the investment size could be affected by the poor state of the export market.

Honda currently produces 130,000 vehicles annually at its Ayutthaya plant and has no plans to increase the number of workers.

Fijimoto said the company would also have to reconsider the government's requirement of producing at least 100,000 ecocars by the fifth year, as the market environment is different from two years ago when the condition was set.

He said the company's ecocar, which Honda will launch next year, would boost the Thai automotive market and encourage more consumers to shift to passenger cars.

All Honda vehicles are currently E20compatible, but Fijimoto did not mention any definite plans to introduce E85compatible models.

"We are not sure if the fuel will be readily available in the future. It depends on the infrastructure of E85. As for hybrid vehicles, this is definitely the trend in the world's automobile markets, but there are as yet no hybrids in the Thai market. We will wait and see the response to the Toyota Camry hybrid," he added.

The shift to hybrid cars has been a quick one in Japan. Although the vehicles have been available for the past 10 years, it is only this year that sales have increased dramatically, mainly since the launch of the new versions of the Toyota Prius and Honda Insight.