Honda to Export Pilot to Russia from U.S.
You may or may not know that Honda Motor Co. builds the Pilot, their mid-size SUV in Lincoln, Alabama. The Pilot competes with SUVs like the Ford Explorer and the Toyota Highlander in the American market and is having a tough time of it. In 2007, sales in that segment fell by 13%, but sales of the Honda Pilot dropped an even more unsettling 23% to 117,346 units from 152,154 in 2006. It was the first year sales dropped since the Pilot’s introduction in 2002. And without putting too fine a point on it, 2008 doesn’t look too promising, either, with all new vehicle sales expected to put in a poor performance and mid-size and large SUVs predicted to drop even farther than the rest of the market.
What to do, what to do?
Honda’s solution is to send some of the new, second-generation 2009 Honda Pilots made in Lincoln, Alabama starting this fall, to Russia, a place that can’t get enough of the Honda Pilot. It’s also a place where they have experienced ten consecutive years of economic growth, where they bought 1.6 million imported vehicles last year ( a 61% increase from 2006), and where the state-subsidized gasoline is around $3.00 a gallon for A-92 unleaded, but Russians that can afford to buy a Pilot don’t seem to mind the gasoline prices much at all. It cannot be ignored that the average Russian, however, is not so blasé about gasoline prices.
The Lincoln plant is going to be pretty busy next year. They already build Odyssey minivans there; Honda is moving all the Ridgeline production from Allison, Ontario to Lincoln, and now the Pilot production seems assured with extra volume going to Russia. The plant has capacity to make around 300,000 light trucks a year, and should be operating at full tilt with all the changes just mentioned.
Honda’s new sales goal for the Pilot in the United States is 140,000 units every year.
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