The new-car price war in Australia heats up every day, but don’t expect Honda to start slashing prices simply to compete with the growing number of affordable Chinese brands. With almost 70 carmakers now fighting for Australian sales, many new entrants have built their appeal around aggressive pricing, lengthy standard equipment lists and an increasing amount of technology.

Honda, however, says it won’t be drawn into a “race to the bottom”.

Speaking with WhichCar by Wheels, Honda Australia staff described the OEM as a “premium Japanese brand”, arguing that competing on price alone doesn’t fit with the company’s positioning.

Front three-quarter view of a burgundy Honda SUV parked beside a brick wall and a green garage door behind it.
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“Australia is the most competitive new car market in the world and we don’t want to get caught up in the race to the bottom,” said Jay Joseph, CEO of Honda Australia.

Honda Australia director Rob Thorp said the company is continually assessing its offerings to potential buyers as competition intensifies, but argued that value shouldn’t be measured solely by the sticker price.

“Value proposition for Honda isn’t purely the price you pay on the day you take ownership,” Thorp told WhichCar by Wheels. “We really value the quality of the ownership experience that you have, and that’s way more than just a cheap purchase price.”

Joseph also differentiated between offering value and maintaining the brand’s cornerstones, pointing to Honda’s aftersales support, servicing, warranty coverage, parts availability and vehicle repairability.

“It isn’t just the purchase price. It isn’t just the low-cost service. It isn’t just the price promise, but also the parts availability, low service costs, dealership experience and new vehicle warranty” he said. “It’s all of those things.”

Joseph believes that the longer-term ownership proposition is particularly important as Australian buyers are presented with an unprecedented number of unfamiliar brands promising lots of equipment for relatively little money.

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Joseph acknowledged that buyers can initially be attracted by “big screens and low initial prices”, but argued Honda’s established aftersales network and ability to support its vehicles over the longer term remain important advantages to its brand.

“We designed cars to be repairable. We provide the parts for them to be repairable,” he said.

“We can get just about any component on any car, anywhere in Australia, within a day. That’s not true [of] certainly some of the newer entrants.”

Thorp also pointed to the brand’s high customer retention rate, saying servicing retention and repeat-purchase figures demonstrate that buyers place value on the ownership experience after purchasing the vehicle.

It’s a strategy that also helps explain why Honda isn’t simply reaching into its international catalogue to chase additional Australian sales. The company sells more affordable vehicles in overseas markets, like the Jazz hatchback and WR-V small SUV, but Honda says potential additions must make sense from a profitability and sustainability perspective, rather than simply adding volume.

While Chinese manufacturers are continuing to put pressure on new car prices, Honda is betting that buyers will see value in paying more upfront for an established brand and everything that comes with it once the car leaves the showroom.