Why did Honda choose to offer just one City Hatchback variant in PH?

In case you’re waiting for more affordable units to come in
by Drei Laurel | May 5, 2021
PHOTO: Sharleen Banzon
CAR BRANDS IN THIS ARTICLE

The Jazz has been discontinued in the Philippine market, ending an epic run by what was perhaps the most beloved hatchback to ever grace our market. There’s a silver lining in all of this, though, as Honda Cars Philippines (HCPI) has been kind enough to replace it with another hatch, the City Hatchback.

Thing is, there’s only one variant of the City Hatchback currently available. If you dig the car, you only have the choice of spending P1,115,000 (exclusive of a P13,000 safeguard duty deposit) for the 1.5 RS CVT with a 1.5-liter gasoline engine capable of 119hp and 145Nm. Whereas with the Jazz, you could choose from at least three units ranging from around P900,000 to P1.1 million.

In today’s economy, financial flexibility is kind of a big deal. So, what gives? We asked HCPI what led to this decision.

The Honda City Hatchback

Continue reading below ↓
Continue reading below ↓
Recommended Videos

According to the company, the decision to have only one locally available variant for the City Hatchback is owed mainly to two factors. The first is that, well, people around here just aren’t buying hatches like they used to.

“We have to zoom out first. Back in 2017 the demand for the hatch market was actually higher, and [since then] we’ve seen a continuous decline, which led us to a lot of different studies. It made us conclude that with the growing segments, there are emerging segments from subcompacts to hatchbacks, there’s a lot of diversification in terms of the market landscape,” Maiko Viar, HCPI product planning section manager said, adding that the subcompact hatchback segment is now a very niche one.

“Coming from the Jazz where we had four grades, with the declining trend in the B segment [subcompacts], we identified which type of customer are we really attracting. For the B hatchback, they’re more particular of the overall drive and the interior versatility. With that being said, that made us decide to bring in just one variant, which is more focused on the upper trim.”

Continue reading below ↓

The Honda City Hatchback - Steering Wheel and Infotainment System

The second factor that led to HCPI’s decision is the lack of shared development costs for the City Hatchback with other ASEAN markets.

The Philippines sources its units from Thailand, which is also responsible for manufacturing Hondas for our neighboring countries. Unfortunately, Vietnam and the Philippines are really the only two nations in the region that drive on the right side of the road, meaning it would not be as cost-effective to produce the model in this format en masse unless the demand makes it worth it.

Continue reading below ↓

“There’s a lot of considerations when bringing in a variant. Not just the number of sales but also the cost of overall development and how many countries we share that cost with. It also dictates how much we sell it in the Philippine market,” Viar explained.

The Honda City Hatchback  - Tail Light

Continue reading below ↓

"For the Thailand market, the City Hatchback, in particular, we have the Philippine market. Most of the countries in the ASEAN region are right-hand-drive. In terms of sharing the cost, it’s really mostly the Philippines, not just with the hatch but with other models as well. There’s only Vietnam to share it with.”

Long story short? If you want more hatchbacks to choose from, buy more hatchbacks. Would you pull the trigger on a City Hatchback if it meant more offerings similar to it will be made available down the line? Let us know in the comments.

See Also

PHOTO: Sharleen Banzon
  • Quiz Results

  • TGP Rating:
    /20

    Starts at ₱

    TGP Rating:
    /20
    Starts at ₱