Honda Australia has confirmed it will reduce the size of its dealer network and model range along with a move to fixed pricing over the next 15 months.
The Japanese brand already expecting a significant drop in sales after the restructuring is completed in July 2021.
At present, Honda has 106 dealerships around Australia, however, the final number of dealers is yet to be confirmed.
Honda says some of its current dealers will continue to operate as satellite service centres without a showroom to ensure owners can still access after-sales support.
The remaining dealers will revert to an agency model with Honda owning the display stock. Dealers will act as a delivery centre and be paid a fee for each model that passes through.
In terms of the model lines, the brand’s better performers, the Civic, HR-V and CR-V are certain to remain. The Civic Type R, Odyssey and the new Accord are also likely to survive in some capacity.
The Jazz and City will both be axed from the local line-up. According to Honda, pressure caused by currency and competition means the two small cars won’t be available beyond 2020.
The cars that Honda continue to offer locally will be sold at a non-negotiable set price which will eliminate competition between dealers, however, the move has the potential to give discounting rivals an advantage if the pricing isn't perfectly judged.
Locally, only luxury brand Genesis and EV specialist Tesla are using a sales model along the lines of what Honda is proposing, it’s a structure that’s yet to be fully tested by a volume manufacturer in Australia.
For context, Honda Australia sold 43,868 cars in 2019, down from 51,525 in 2018.
Honda’s announcement follows GM’s decision to axe Holden in Australia and Nissan dumping its Inifini luxury arm.
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