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Tony O'Kane | Jul, 30 2014 | 9 Comments

Honda Australia has had a fairly dismal 2014 so far, with year-to-date car sales down by roughly a third compared to the same period last year.

To the end of June, the Japanese automaker had sold just 15,443 cars, with all models bar the City and Odyssey selling in significantly fewer numbers than they did in 2013.

But, with the arrival of the new Jazz and the local launch of the HR-V (below) on the horizon, Honda's fortunes may soon improve.

According to Honda Australia MD and CEO Noriyuki Takakura, the company expects to sell around 19,600 cars in the latter half of the year, bringing the total to approximately 35,000 cars.

That's a significant shrinking of Honda's intial estimate of 40,000 cars for 2014.

And the reason for Honda's poor showing in the first half of the year is primarily down to supply.

According to Honda Australia Director Stephen Collins, the Jazz - normally one of Honda's highest-selling models - has been particularly hurt by supply constraints.

"The major thing particularly has been that we’ve been running out [models], particularly Jazz and City, and in fact we’ve been desperately short of Jazz stock," Collins said to TMR at the local launch of the Jazz this week.

"Last month we sold around 140 Jazzes, and it was literally because we had no stock left to sell."

Another factor has been the rising value of the British Pound, which has forced price rises for the UK-built Civic hatch range and dented its showroom appeal, reducing sales for the Civic hatch by more than half.

"Civic five-door is one of the major declines versus the previous year," Collins said.

"The issue there is that we source it from the UK so we’ve had some challenges with the appreciation of the British Pound versus the Aussie Dollar, which has been about 20 percent.

"That’s put significant costing pressure on that car for us. We’re still committed to it [Civic hatch], but we’re certainly selling less compared to what we were doing last year.

"We were selling about a thousand hatches [per month in 2013], and about 5-600 sedans. Whereas now the split would be closer to 50-50."

With only 908 Civics of both bodystyles being sold last month, that's a whopping 1000 cars fewer than June 2013.

The bulk of the anticipated volume increase in the second half is expected to come from the just-launched Jazz and the still-fresh City, which launched locally in May.

Jazz sales are expected to number around 800 per month, and the order book is already filling up after just a week in the showrooms.

"To date we have around 600 buyer orders. It’s off to a good start," Collins said.

"But we’re not complacent though, it’s a very competitive segment. There are some new models coming later in the year so we’ve got to stay aggressive and we’re going to promote the car heavily, particularly on television."

Meanwhile, according to Collins the City (above) is exceeding expectations.

"It’s been going really well," he said.

"We said initially that our plan was to do about 250 a month, and our first couple of months we’ve been doing close to 400 [per month], so we have a number of back orders which we’ll be fulfilling over the next few months

"We’ve been very pleased with it. It’s in a relatively small segment, but if we can maintain that 350-400 per month we’ll be very happy with that."

Looking further into the future, the HR-V is also expected to deliver a substantial boost in sales when it arrives in February next year.

Taking Honda into the booming small SUV segment to do battle with the Nissan Dualis and Mitsubishi ASX, Honda Australia expects it to be as popular as the Jazz - meaning 800 cars sold per month.

The HR-V will launch initially with an all-petrol powertrain range, though a diesel will be added later in the year.

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