Ford, GM, Chrysler are losing market to Honda and Toyota

Honda Motor Company (TYO: 7267) is trying to make a turn around with its hybrid models and this means more loss of market shares for American automakers especially, the famous ‘Detroit Three.’ In 2009, Honda Motor Company is planning to release hybrid models that will cost only$1900 (€1,206). Honda is also planning to bring out the hybrid version of its popular Fit subcompact vehicle. Jesse Toprak, chief industry analyst, Edmunds.com referred Honda’s strategy as a ‘game-changer for the short term’. Currently, Honda has the most fuel-efficient car models in the USA market. The company will sell its new hybrid only cars in USA, Japan, and Europe from next year but it has not determined anything about the Fit subcompact hybrid. International Herald Tribune reports:

In addition to the new model and the Fit, Honda will introduce several other hybrids: a Civic and a new sporty model based on the CR-Z, Fukui said.

Fukui refused to give the price for the new hybrid-only vehicle.

But he said the difference between hybrids and their comparable standard models should be kept within 200,000 yen ($1,900, €1,206), although such price gaps can now reach as much as 500,000 yen ($4,800, €3,047).

"The 200,000 yen difference is a must," Fukui said.

Hybrids deliver a cleaner, more efficient ride by switching between a gas engine and an electric motor at different speeds, and by recycling the energy the car produces as it moves.

Honda aims at selling 200,000 ‘entry-level’ hybrid cars every year. To make the cars cheaper, the company has introduced a new electronic control unit and thinner and more compact battery. It is also developing a thinner motor.

North American car companies are good at making big vehicles like trucks and SUVs. With the rising cost of fuel American people are shifting towards smaller fuel-efficient cars.

Michael Robinet, vice president, Global Forecast Services for CSM Worldwide, an auto industry consulting company in Northville, says that GM and Ford could rely on their European and Asian operations for small car expertise. Chrysler has joined with Nissan to release small cars by 2010. GM is focusing on its larger hybrid vehicles and plug-in car Chevrolet Volt which will be released in 2010. Ford is planning to release midsize hybrids next year.

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