Honda Will Delay Chinese Production Of 2009 Civic Hybrid

Honda announced last week that it will delay its China production plans for the 2009 Civic Hybrid, citing a lack of "detailed and preferential policy issues." The Chinese government has not yet determined what incentives will be offered and when. Such incentives may have a significant impact on the willingness of the Chinese consumer to purchase a hybrid vehicle.

Honda sells an imported Civic in China right now, and has priced the vehicle at about USD$40,000. The company has a sales target of 200 vehicles for 2009. According to the company, the delay does not represent a change in Honda's commitment to produce the Civic locally for Chinese customers.

The issue of governmental incentives for consumers has also appeared in the US presidential campaigns of John McCain and Barack Obama. McCain, who campaigned in Michigan last week, supports tax credits of $5,000 to consumers who purchase the Volt and other vehicles that substantially reduce US dependence upon foreign oil. He also supports government funded automotive research, state-by-state fuel economy standards, and the development of high-performance battery technology.

Barack Obama has pledged $150 billion over ten years to promote a green energy sector. He also supports stricter fuel economy standards, tax credits to consumers who buy hybrids and ultra-efficient vehicles and subsidies to automakers to pay for health care benefits if the automakers commit to making greater investments into the development of advanced technologies.

Sources: Autoblog, Edmonds Inside Line