Honda sales sneak past Toyota in China

By Graeme Roberts | 9 December 2016

Honda Motor sales in China passed Toyota Motor's in the first 11 months of 2016 as new models attracted buyers and set the Japanese rivals up for a 'photo finish' in their full year rankings in the world's top car market.

A Reuters report noted Chinese consumers have flocked to Honda's slew of new models, including a new version of the staple Civic sedan, as well as particularly strong offerings in the booming sport-utility vehicle (SUV) segment.

To meet the booming demands, Dongfeng Honda, a local production joint venture, has just broken ground for its third plant on a 1.2m square metre site approximately 8km (five miles) southeast of the company's first plant within Wuhan Economic & Technological Development District.

But Reuters also noted auto sales in China remain under pressure from slowing economic growth, with analysts predicting weak growth next year despite a rebound in 2016 thanks to tax incentives.

SUVs, though, have been a major exception, with the segment growing 45.6% year-to-date, as Chinese buyer preferences to larger cars.

A Beijing-based Toyota spokesman declined to comment to the news agency on its sales performance compared to rivals.

"We don't have a blind focus on boosting sales," he said. "Our main objective in China is to achieve steady growth of our business, by focusing on customer satisfaction, including creating a quality sales and service environment."

Honda sold about 14,500 cars more than Toyota for January to November to pass it for the first time this year, according to sales reports released by the two firms, potentially setting up the Tokyo-based company to narrowly overtake Toyota in full year sales if the trend continues.

"Beating a particular rival brand isn't our business objective in China," a Beijing-based Honda spokeswoman told Reuters. "We focus on Chinese consumer needs and feel the strong sales momentum we have in China now is evidence that our strategies are working."

Honda has recorded nine consecutive months of double-digit sales growth in China and is nearing its sales target of 1.18m vehicles, which it revised upward by roughly 100,000 units in October, the news agency added.

Toyota sales fell about 50,000 vehicles short of reaching its 1.15m vehicle sales target as of November, Reuters reported. The automaker has traditionally led its rival in the Chinese market, selling 240,000 cars more than Honda as recently as 2014.

But Japanese automakers still trail far behind market leaders General Motors and Volkswagen which both sold around 3.6m vehicles last year in China, the report added.