Honda says to raise Insight output as orders climb

TOKYO Tue Feb 24, 2009 10:43am GMT

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TOKYO Feb 24 (Reuters) - Honda Motor Co plans to produce more of its new Insight hybrid cars from April, having received orders for almost three times its monthly sales target for the gasoline-electric model it launched on Feb. 6 in Japan, a top official said on Tuesday.

Honda plans to launch the Insight, its first attempt at a low-cost, high-volume hybrid, in Europe and the United States over the next two months.

Japan's No.2 automaker is targeting global sales of 200,000 Insights a year, with half of that in North America and 60,000 in Japan, hoping to rival Toyota Motor Corp as a leader in the hybrid segment.

"The response has been overwhelming," Hiroshi Kobayashi, deputy chief operating officer for Honda's domestic operations, told a small group of reporters at a test-drive event in Tokyo.

"We will have to increase production plans," he said. But he stopped short of saying how much it could expand output given possible supply limits for hybrid components.

Customers in Japan will have to wait at least one month for an Insight if they ordered one today, he said.

Honda is positioning the Insight as its fifth "global car" alongside the Civic, Accord, Fit and CR-V cars, which collectively make up about two-thirds of its car sales.

Kobayashi said half of the Insight sales so far were to customers switching from other brands, including premium import brands and Toyota's hybrid leader, the Prius. The Insight starts at 1.89 million yen ($19,980) in Japan.

"What's unique about the Insight is that we're attracting a broad range of drivers, from (660cc) minivehicles to sedans to minivans," Kobayashi said.

While cautioning that the Japanese car market remained tough -- total vehicle sales in January fell 20 percent from the year before -- Kobayashi said Honda aimed to sell as many cars in the business year from April as the 570,000 to 580,000 units he expected it to sell in the 12 months to March 31.

Toyota is due to launch its third-generation Prius in May, pricing it slightly higher than the current version, which starts at 2.3 million yen in Japan. Local media have reported widely that Toyota would take the unusual step of selling the current model at a discount alongside the new version to compete with Honda's Insight.

A Toyota spokeswoman said the company had made no such decision yet. ($1=94.59 Yen) (Reporting by Chang-Ran Kim; Editing by Hugh Lawson)

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