Honda's new hybrid is hot in Japan

The new Honda Insight hybrid, slated to go on sale in April in the U.S., is already big in Japan.

Reuters reported today that Honda has received almost triple the number of orders it expected for the car after it went on sale in its homeland on Feb 6.

“The response has been overwhelming,” Honda executive Hiroshi Kobayashi told reporters at a test-drive event in Tokyo. Demand has been such that the automaker intends to expand its production plans for the car, Kobayashi said, although he declined to specify by how much.

The Insight, he added,  is drawing interest from a broad range of vehicle owners, from mini-vehicles to sedans to minivans. There’s currently a 30-day wait to take delivery of a new Insight.

The strong response is occurring even as the Japanese auto market suffers through the same slump that is depressing auto sales around the globe. New vehicle sales were off 20% last month in Japan.

The Insight’s popularity could be due to its price — it starts at around 1.89 million yen (just under $20,000 at current exchange rates), almost 20% less than the rival Toyota Prius.

In Japan, Honda is also boasting fuel economy of around 61 miles per gallon for the Inisght. Based on U.S. mileage tests, the current-generation Prius gets 46 MPG in combined city/highway driving. The third-generation Prius, due in showrooms in the U.S. and Japan this spring, will get around 50 MPG combined, Toyota has said.

You may remember that the original Insight, a futuristic looking two-seat that hit these shores in December 1999 — actually beating the Prius to the U.S. market by more than six months. The Prius made up the lost ground, however, and became the purpose-built hybrid of choice for Americans. The original Insight was R.I.P. by 2006.

The new Insight is slated to go on sale in the U.S. in April. Officially unveiled at the Detroit auto show in January, it has been lampooned a bit for looking too much like, well, the Prius. But, as in Japan, it’s expected to cost less than the Toyota hybrid, which should be an important selling point in these economically challenged times.

-- Martin Zimmerman

Photo: The new Honda Insight hybrid is unveiled at the Prince Park Tower hotel in Tokyo on Feb. 5. Photo credit: Gianni Giosue / European Pressphoto Agency

Comments

[Gilser]

Why does this blog say the Insight gets 61 mpg? The Honda Web site says 40-43 mpg.

[Martin Zimmerman]

That figure is from the press materials Honda released for the Insight's launch in Japan -- 26 kilometers per liter. It is higher than the figures Honda has reported for the U.S. version. They may use a different method to calculate fuel economy in Japan than the EPA uses in the U.S.
-- Martin Zimmerman

[Ronbo]

I've read that Toyota makes very little on the Prius - a couple of hundred dollars per car. I wonder what the margin is on the Insight. Do they make these to accumulate market share and build brand loyalty (a well honed Japanese business strategy), or are these actually money makers? Its an important question as many demand Detroit offer a similar product.

[HealthyBreeze]

The profit margin on car models tends to vary, but --if prices hold steady--margins usually goes up over time as the fixed development costs are recouped, processes become more efficient, and economies of scale really kick in. That said, Honda's hybrid technology does not require as much hardware as Toyota's, and should cost less. Toyota's hybrid tech has a bit more potential for fuel efficiency, but with sensible driving habits, both sound like superbly efficient vehicles. ,

[EY]

When Japanese automakers keep building better, nicer, and gas saver cars, I dont see much coming from our US cars. There are huge demands on these hybrids.

[pkc]

As a consumer, I would rather buy the Insight over the Prius. It is just simple math.
Insight cost 20% less which is equivalent to about $4000.
Insight gets 43mpg and Prius gets 50 mpg. For an average of 15,000 miles per year, the Insight only uses about 49 gallons more fuel. At $2.25/gallon, it would take the Prius over 35 years to recoup the $4000.

[Rob N]

GM used to make a 3 cylinder Geo Metro. I owned 2 of them. I would easily get 38 mpg in the city. On the Highway I would average 50 mpg. What happened to that car?? It was a plain gas engine too. And cheap.
GM is so stupid.

[hlwicker]

Insight for $20K? Not likely. The greedy Honda U.S. dealers will hike the price up to $30K, negating any affordability or price advantage over the Prius.

[Ken Iisaka]

Geo Metro was not manufactured by GM, but by Suzuki in Japan. It was a tin can which has no hope of meeting any of the safety requirements today. In comparison, the Insight is a much better car for not much more money (adjusted for inflation) which is nearly as efficient per mile.

[Cy Chan]

Mr. Zimmerman, if you present the US EPA numbers for the Prius, why do you present the Japan fuel economy numbers for the Insight right next to them without distinguishing the sources of information more clearly. As currently worded, readers will not realize the difference and assume they were a product of the same testing procedure.

I am a Prius owner, and I'd argue that even the current generation Prius, which has been on the market since 2003, is still a better buy than the Honda Insight. Calculating how much time it takes to make up the difference in base purchase price (which is $22,000 - $19,800 = $2200, not $4000) ignores the fact that the Prius (110.6 cu ft pass+cargo interior) is a midsize car, and the Insight (100.9 cu ft pass+cargo interior) is a compact. You're paying more for the Prius, but you're also getting more. When the current generation Prius was released in 2003, it also started for below $20,000.

[4kBeast]

I went to a Honda dealer and drove the Insight EX - it is a nice package, but I agree with reviewers that the plastics are pretty bad and the engine is buzzy. The paddle shifters were fun, but only as a novelty, it is still a CVT. I sat in the back seat and had NO leg room or head room. It may be a compact, but it still feels like a Fit (what the Insight is based on). At least the Prius I sat in had rear leg and head room. Seriously, try sitting in the back seat of both! And the reviews like R&T and others are funny, the Insight doesn't win a single think besides price in the comparisons, and the Insight wins? It's funny to read the comments under those articles, cause no one gets why the Insight won.

Looking at Honda's technical specs, Honda dummied down the Honda IMA system from the Civic- it isn't the same system. They removed the high speed VTEC cam profile, lowering the HP from 110hp to 98hp. The engineers said it was a lighter car and didn't warrant the extra hp (plus it saved they money, right?). They used a smaller, cheaper electric motor that is 13hp (Civic Hybrid is 20hp) as well. Last, but not least, Honda used a battery pack that has 2/3 the electric output of the Honda Civic (engineers said they are better batteries, and they saved money). The article on Honda.com quoted the engineers as saying that their hands were tied on a lot of the technology they weren't including in their car, because it was clear from the start that they were trying to hit the sub-$20k price point. So why is this car being hailed as an affordable, technical marvel? The Civic has a better IMA system, but I guess people just want the "look" of a green car. And they don't want to buy a $24k+ Civic. Ouch. Besides, looking at the Toyota system, you're getting a lot more technology for your money, as well as a much more capable system.

And what of their major selling point of being a $20k hybrid? The dealer had a EX that I drove and it was $21,170 with delivery (read as: $22k!)! I asked about the $20K car, and was told that most consumers are asking for the EX because the LX doesn't have cruise control, a center console (are you serious!?), map lights/vanity mirrors, etc. that most people want. And the funny part is that the sub-$20k Insight is $20,470 with delivery. It isn't that much more for a Prius, according to my math. And most dealers are jacking the prices up because of "high worldwide demand."