Honda Motor Co, the first Japanese automaker to open a plant in China, said sales growth of its Accord sedans there is slower than expected as competition rises and prices fall in the world's third-largest car market.
Accord sales in China climbed 23 percent to 92,870 cars in the first 11 months of the year, compared with a 60 percent surge in the second quarter, Masaya Nagai, a spokesman for Honda China, said in an interview in Beijing.
Sales this year are "a bit lower than expected," he said while attending a car-awards ceremony in the Chinese capital on Friday. "There are several reasons, including price-cutting and economic controls."
Honda joins General Motors Corp, Volkswagen AG and other overseas automakers in reporting slowing sales in China, as buyers delay purchases in anticipation of further discounts and the government's lending curbs reduce access to credit. Growth in passenger car sales nationwide is forecast to slow to about 30 percent this year from 76 percent last year.
Honda, which has 5 percent of China's automobile market, said it has no plans to cut prices of existing models to boost that share. "We need to build customer loyalty," Nagai said. "Customers don't want the price falling after they've bought a car."
China's automakers reported a combined 34 percent decline in third-quarter profit on Nov. 29.
"Carmakers have reduced their supplies to the market because dealers are trying to clear stockpiles, slowing sales and reducing earnings," Tang Chuan, an analyst at KGI Asia Ltd in Shanghai, said at the time.
Honda sold 190,344 units in the first 11 months of the year, a 70 percent gain as new capacity came on line.