Honda Takes on Toyota’s Aqua With Remodeled Fit in Japan

Sept. 5 (Bloomberg) -- Honda Motor Co., Japan’s third-biggest carmaker, will begin selling its remodeled Fit hatchback tomorrow in Japan to challenge Toyota Motor Corp.’s lead in hybrid compact cars.

The third-generation Fit will be priced from 1.26 million yen ($13,000) for the gasoline version, Tokyo-based Honda said in a statement today. The sales target for the model is 15,000 vehicles a month.

Honda President Takanobu Ito is introducing the revamped Fit, sold as the Jazz in some markets including China, to help increase annual sales to 6 million vehicles by March 2017 and dent the dominance of Toyota’s Prius c. Ito is counting on growth in emerging markets and demand for compacts such as the Fit, the smallest in Honda’s portfolio and its top seller in Japan, as motorists increasingly buy small cars.

The gasoline-electric version of the model can run 36.4 kilometers per liter under Japanese standards, Honda said. That’s better mileage than the Prius c, Toyota’s most fuel-efficient hybrid, which covers 35.4 kilometers per liter under the same standards, according to company figures.

Honda said it will price the hybrid version at 1.63 million yen in Japan. The price is 3 percent less than for the Prius c, the world’s best-selling gasoline-and-electric vehicle, which is called the Aqua in Japan.

Fit Pre-Orders

Honda rose 2.9 percent to 3,780 yen as of 2:04 p.m. in Tokyo trading, compared with a 0.6 percent advance in Japan’s benchmark Nikkei 225 Stock Average. The shares have gained 20 percent this year.

The company expects hybrids to account for 70 percent of domestic Fit sales, Senior Managing Officer Sho Minekawa said today in Chiba, near Tokyo. It has advance orders of 25,000 for the new Fit in Japan, he said.

Honda will make the car at its factory in Yorii, northwest of Tokyo, that opened in July. It will also build the car at a new factory in Mexico opening next year that will eventually have an annual capacity of 200,000 vehicles.

Aqua is the top-selling car in Japan, followed by the conventional Prius, according to figures from the Japan Automobile Dealers Association. Sales of the Aqua reached 160,993 units in the first seven months of this year, the association’s data show.

To contact the reporters on this story: Anna Mukai in Tokyo at amukai1@bloomberg.net;

To contact the editor responsible for this story: Young-Sam Cho at ycho2@bloomberg.net