Honda dragging its heels on diesel

Other importers are seeing good sales of diesel models but Honda still can't hop on the gravy train just yet
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Honda is one of the few brands in Australia without a diesel option among its range. Worse still, the local arm is forced to watch others enjoy significant sales momentum for diesel's frugal motoring.

Cost and source are the two main issues preventing diesel Honda models from appearing in local showrooms, according to spokesmen for the brand.

Honda is developing new, more efficient petrol engines and a small diesel option for Europe by 2012, but Honda Australia "does not plan to introduce it," according to company MD Satoshi Matsuzawa.

"That doesn't mean diesel is off the table [for Australian Honda customers]," he quickly added during the press conference for the launch of the new Insight.

"We need to assess whether it is viable and profitable," he explained.

But surely its viability and profit-making potential is obvious when some brands' volume is attributed to up to 50 per cent diesel models?

"There's clearly a market for diesels so we're not ruling it out," said Stephen Collins, General Manager Sales and Marketing for Honda Australia.

"At the end of the day the business case has to add up and cost [currently] is an issue. But we certainly recognise the opportunity, in various segments... We don't deny there's an opportunity there."

The figures won't "add up" for at least 12 months, Collins suggested. "Beyond there, we're still working through it [the case for diesel]... It's certainly an interest but at this stage we can't confirm anything in that respect."

Not only is the cost of sourcing Honda diesel powerplants for local buyers prohibitive but the local team also needs to close-up the price for a diesel over a petrol engine.

"Ultimately the premium between a diesel and petrol [offering] needs to be reasonable in its marketplace, especially given how competitive our marketplace is," said Collins.

Honda Australia's National Public Relations Manager, Mark Higgins added factory costs and a lack of surplus also delayed plans for a diesel offering locally.

Currently the well-acclaimed 2.2-litre turbodiesel is available in European-market Accord, Civic hatch and CR-V models and even if Honda Australia could trim source expenses, supply would be constrained due to demand elsewhere.

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