Honda's horror year in 2022, but 2023 will be the true test for CR-V, HR-V and new ZR-V

Last year we asked if Honda’s new way of selling cars could change the way every brand went about dealing with customers. And the answer is… too early to tell.

To be blunt, Honda had a horror year in 2022 with sales dropping by nearly 20 per cent (19.1 per cent, to be precise) to just 14,215 cars. This compares to more than 40,000 cars the Japanese brand sold in 2019. 

But those pre-COVID days and Honda’s switch to the so-called ‘agency model’ of selling cars - with a fixed national price and direct sales from Honda rather than its dealers - means comparing the brand’s 2019 sales with 2022 is both unfair and misleading.

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However, Honda's final '22 tally also falls well short of the "20,000 pace" Honda Australia's former managing director Stephen Collins talked about in May last year, so it was a rougher than expected year for the company. Like many brands Honda struggled with supply last year as the global supply chain crisis and semiconductor shortage dragged on.

Sales of the Civic were down a massive 70.7 per cent on 2021 levels, with just 865 examples of the hatch finding buyers. The HR-V was also down, 22.3 per cent, but managed 4717 sales which put it ahead of models including the Volkswagen T-Roc, Skoda Kamiq and Jeep Compass in its segment.

The silver lining for Honda is the CR-V, which, despite its age, remained quite popular, with 8123 sold, an increase of 18.2 per cent on ‘21 and better than the Nissan X-Trail and Ford Escape managed.

The even better news for Honda is that a new CR-V is on the way, as is a new ZR-V that will slot between the existing models. Both are expected in the first half of the year and will allow the brand to offer a broader range which should appeal to more customers.

The HR-V sales were down 22.3 per cent.

The new CR-V has grown significantly over the current model, which is why introducing the ZR-V makes sense for Honda’s line-up. This will give the company models in each of the key SUV segments and allow for a bounce back.

“We currently have good stock levels of the popular CR-V and we previously confirmed there will be an all-new SUV model joining the Honda line-up in the first half of 2023,” a Honda Australia spokesperson told CarsGuide.com.au, referencing the ZR-V without naming it. “We are eager to be able to expand our SUV line-up to three given the strength of the SUV market in Australia.”

Sales of the Civic were down a massive 70.7 per cent on 2021 levels.

Honda also has another reason to be excited in 2023 - the in-coming Civic Type R. The highly-anticipated hot hatch will give the brand a hero performance model to counter-balance its pushing into the hybrid space with the Civic, HR-V and ZR-V.

However, the company does admit that supply of its other models (other than the current CR-V) is still problematic and it expects this to remain the case throughout the first half of 2023. 

Despite the difficult start to its new way of selling cars, the brand believes the agency model is working for it though.

The new-gen CR-V could arrive before the end of 2023.

“Honda Australia continues to receive strong, positive feedback from customers and the Honda Representative network regarding transparent and haggle-free pricing, low-price servicing, and access to centralised stock that the agency model provides,” the spokesperson said. “Price transparency in particular continues to provide our customers with the confidence of what to expect before they step into a showroom.”

While it appears we won’t get a clear understanding of just how Honda’s more direct sales policy is working until it can secure more supply, it will be worth keeping an eye on the brand’s fortunes in 2023.

Early indications are positive, with the CR-V and Civic both reporting sales growth in January 2023, although the HR-V continues to struggle in the current climate.