The auto industry is coming to a crossroads. Two things are changing the way automakers go about developing new vehicles: 1) government regulations are mandating the development of more fuel efficient vehicles and 2) most auto manufacturers are seeing sales drops of 30 to 40 percent year-over-year which is cutting into their bottoms lines.
Honda is feeling the heat from a sour economy and a change in consumer spending habits. Honda had plans to develop a V8 engine and rear wheel drive (RWD) platform for an upcoming sedan which would wear an Acura badge -- those plans have now been shelved.
The move was supposed to inject Acura with a bit of "luxury" to better compete with the likes of BMW, Mercedes, and Lexus. Currently, the company is mostly likened to "tweener" brands such as Volvo, Saab, and Buick.
"I don't think we need a classic front-engine, rear-drive car," said Honda President Takanobu. "It would be meaningless to emulate what other companies have been doing for more than five decades."
Honda will focus on more fuel efficient V6 engines instead of developing a new V8 engine for its luxury brand. The company already produces two stout V6 engines which are available on Acura vehicles. The Acura TL can be had with a 3.5-liter V6 producing 280 HP or a 3.7-liter V6 producing 305 HP.
Instead of throwing money at an all-new RWD platform, the company will likely continue to adapt its Accord chassis for use in all-wheel-drive (AWD) applications like the Acura TL SH-AWD and Acura RL.
Honda is also exploring adding more efficient transmissions -- Acura is still using 5-speed automatic transmissions when most competitors are using 6, 7, and 8-speed units -- along with hybrid technology to further increase the fuel economy of its Acura vehicles.
Honda already uses hybrid technology in its Civic and Insight models; it also recently announced that a Fit Hybrid and a CR-Z Hybrid will come to the North American market next year. There has also been heart-breaking news that the replacement for the Honda S2000 will be a FWD hybrid.
Honda has yet to bring the technology to its Acura range.
Honda is not the only auto market altering its future plans, however. In the case of auto giant Toyota, executive vice president Yoshimi Inaba says that the company is no longer profitable in North America. The company saw its sales drop from 1.25 million units for the first six months of last year to just 770,000 units for the same period this year. The company is also considering closing its NUMMI auto plant in California which would impact 4,700 employees.