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Honda Offers Incentive on Accord Hybrid
By Rick Popely, Chicago Tribune
Nov. 3--High gasoline prices don't necessarily translate into blockbuster sales for all gas/electric hybrid vehicles.
Honda is offering a $1,200 deal incentive on the Accord Hybrid, making it the first gas/electric model to receive such financial support from the manufacturer.
Since Oct. 4, dealers have gotten the $1,200 from American Honda Motor Co. for each Accord Hybrid they sell. Other 2005 Accords carry dealer incentives of $700 to $1,200. The offers are scheduled to end Dec. 5. The dealers then can pass any or all of that money along to the consumer.
Honda sold 2,336 Accord Hybrids in August and 2,352 in September, but sales fell to 1,266 in October. Honda expected to sell 20,000 for the year and have sold a shade more than 15,000 through October. Spokesman Chuck Schifsky said that was because dealers were working to clear out 2005 models in preparation for the 2006s. The 2006 Accord Hybrid will go on sale around Dec. 1 with new front and rear styling changes (like those on gas-operated Accords).
"It's selling fine," he said. "I don't have an exact number of the supply at dealers, but it's very low at this point. What you're seeing are issues with a model year change and getting vehicles to dealers."
But Mike Chung, an analyst with consumer automotive Web site Edmunds.com, thinks the Accord Hybrid needs the $1,200 perk because it does not deliver the high mileage of hybrids such as the Honda Civic and Toyota Prius.
"The Accord isn't a true hybrid in the same sense as the Prius," Chung said. "The Prius uses its hybrid engine to increase fuel economy. On the Accord, the hybrid engine is there to give it an acceleration benefit."
The EPA rates the Prius at 55 m.p.g., the Civic Hybrid at 50 and the Accord Hybrid at 32 in combined city and highway driving. The Accord Hybrid has 253 horsepower, nine more than gas-only Accord V-6 models, which gets 23 m.p.g.
It went on sale in December 2004 and sold at full sticker price initially, but Chung says it has sold for less than sticker in recent months.
Edmunds' Web site says the average price of the 2005 Accord Hybrid is $29,053, nearly $1,100 less than suggested retail. In comparison, Edmunds says the Prius sells for nearly $2,000 more than sticker because of high demand.
Edmunds bases its information on transaction prices obtained from dealers.
Toyota spokesman Sam Butto said all of that automaker's hybrids are in short supply--without incentives.
"We're on a pretty good pace," he said. "There's no real need for incentives at this time."
Unlike cash rebates, the $1,200 dealer incentive on the Accord does not have to be passed on to consumers. Dealers can use the money to lower the selling price, throw in free extras such as car washes and oil changes or pocket the money.
Copyright 2005, Chicago Tribune
Distributed by Knight Ridder/Tribune Business News.
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