Honda Motor Co.
) plans to roll out Acura cars in China within three years in
order to tap the burgeoning demand for cars by an affluent class
of people in the world's biggest auto market.
FUJI HEAVY ADR (FUJHY): Get Free Report
GENERAL MOTORS (GM): Free Stock Analysis
HONDA MOTOR (HMC): Free Stock Analysis Report
NISSAN ADR (NSANY): Get Free Report
To read this article on Zacks.com click here.
Honda is trying the produce the vehicle with a local partner
Guangzhou Automobile Group Co in order to avoid high tariffs
charged on imported cars in China. However, it has not yet
revealed any details regarding the size of production capacity or
the model it plans to produce.
However, a Beijing-based Honda spokeswoman revealed that the new
Acura in China would probably be a compact sports utility vehicle
(SUV) that has not yet presented by the company in the brand's
product lineup. It could be based on a "concept" model -- the
Acura SUV-X -- that has been showcased at the Shanghai auto show
Apart from Honda, other prominent automakers such as
General Motors Company
Nissan Motor Co.
) are focusing on new vehicle launches in China. Recently, GM has
begun producing Cadillac cars while Nissan Motor is building a
plant in the eastern city of Dalian to rollout some models for
its premium Infiniti brand.
After months of sluggish growth owing to weak economic conditions
and restrictions imposed by the government on new vehicles, total
vehicle sales in China reflected a steady growth of 11.2% in Jun
compared with 9.8% in May, according to the China Association of
Automobile Manufacturers (CAAM).
A total of 1.8 million vehicles were sold in the country during
the month, leading to sales of 10.8 million vehicles for the
first half of the year, up 12.3% on a year-over-year basis.
Passenger vehicle (cars, multipurpose and sport-utility vehicles)
sales also increased steadily by 9.3% to 1.4 million units in Jun
compared with 9.0% in May. For the first half of the year,
passenger vehicle sales rose 13.8% to 8.7 million units.
The steady growth in sales was mainly attributable to lower
prices, which partially offset the effect of shortage of credit,
weak economy and government restrictions on vehicle registration
due to increasing traffic congestion and pollution in Chinese
Currently, shares of HMC retain a Zacks Rank #5 (Strong Sell).
Among the Japanese automakers,
Fuji Heavy Industries Ltd.
) with a Zacks Rank #1 (Strong Buy) is performing well.