5th Gear FD2R v FN2R

[aaronng]

Your post is essentially saying 2 things;

1. How can the FN2R be so cheap? Simply put, have you considered that maybe the UK also did a bit of a markup themselves on the CTR to pitch it at a higher market? That being said, maybe it isn't that profitable for Honda AU but they just want to get the indirect benefits such as the marketing of "Look we did bring a Type R", or "Look we have the most outrageous looking hatch on the market" (I know it's subjective).

That being said, the cost of labour and parts in the UK is very high, higher than in Australia. While it is possible with the marketing reasons that you bring up, the business case for car imports even within the company must show a profit. If there is no profit, the Honda UK R&D/Accounts department will always say no.

2. Why won't they bring the FD2R? Many reasons- will the market really want such a hard car? It'll be competing with the likes of Liberty GTs and Mazda6 MPS, as well as the American cars... all of which will offer more power (on a spec sheet) and a more comfortable ride. Then there's also the question of will it steal sales away from the FN2R? Is it wise to confuse the market with TWO Civic Type R's especially when they are both relatively new cars to Australia?

The FD2R at the same price as the FN2R ($40,000) does not go into LGT and MPS territory. And confusing with two Type Rs? One is a sedan and the other is a hatch. It's like people getting confused with a 3MPS and a 6MPS. If the public can differentiate between the sedan Accord Euro and sedan Accord, they can surely differentiate between a "CTR hatch" and "CTR sedan".

IMO the FN2R killed two birds with one stone- Honda's lack of a non-sedan sports car in the sub$50k category (after the Integra was taken out) and it also let them promote the Type R badge. Put it together and they also have exclusivity going for them with purists perceiving the Type R badge as being the epitome of Honda's engineering.

Note: The above comments are my own views and thoughts; and are not intentionally reflective of anyone else's.

There is one more bird that has not/never been killed by Honda Australia. A sedan sports car. Also, purists are smart enough to differentiate between a real Type R and one with just a badge.

Also, my comments are not 100% in disagreement with your views, but they are just me venting my frustration at Honda Australia since they always cite cost as a reason for not bringing in a true Type R (or FD2R) eventhough it's cheaper than the FN2R that they have brought in. If I come across sounding like a *ickhead, please forgive me.

[JaCe]

That being said, the cost of labour and parts in the UK is very high, higher than in Australia. While it is possible with the marketing reasons that you bring up, the business case for car imports even within the company must show a profit. If there is no profit, the Honda UK R&D/Accounts department will always say no.

What you say is correct, but also take into account fixed/sunk costs. Ultimately Honda UK wants to get the highest returns on the amount of capital invested in the development of the car (i.e. "sunk" costs because they cannot be taken back). In doing so, even if they make $0.01 of economic profit (that is, normal profit less opportunity cost), they will still proceed because it will be better in the long run.

I'm inclined to think from Honda Australia's point of view, they can probably negotiate a decent import price and still make a small amount of profit on it. Obviously I can't say how much, but like you said, they wouldn't do it at a loss.

The FD2R at the same price as the FN2R ($40,000) does not go into LGT and MPS territory. And confusing with two Type Rs? One is a sedan and the other is a hatch. It's like people getting confused with a 3MPS and a 6MPS. If the public can differentiate between the sedan Accord Euro and sedan Accord, they can surely differentiate between a "CTR hatch" and "CTR sedan".

I was under the impression that the FD2R if it came out here it would be priced more towards the $50k mark based on the Malaysian prices (RM200k).

We may know the difference, but how would you go about educating the public of the difference? It's not as simple as say a Ford Focus where the Hatch and Sedan are pretty similar cars, because in this case, they are totally different. I'd say this adds to confusion, and adding diversity to the product mix isn't going to have a huge impact on total sales revenue.

There is one more bird that has not/never been killed by Honda Australia. A sedan sports car. Also, purists are smart enough to differentiate between a real Type R and one with just a badge.

I agree with you here because, like the Evo, this car is probably targeted at the purists rather than the people who'd go for the LGT/MPS. That being said, I still think that in the $40k price bracket, it'll attract too much attention and lose the exclusivity factor which Honda needs to prevent doubling up on targeting the same market.

Also, my comments are not 100% in disagreement with your views, but they are just me venting my frustration at Honda Australia since they always cite cost as a reason for not bringing in a true Type R (or FD2R) eventhough it's cheaper than the FN2R that they have brought in. If I come across sounding like a *ickhead, please forgive me.

It's alright, but the reality is it is due to cost. But not in the same way you'er thinking.

[Philip Lee]

they can just stop bringing the FN2R after the contract for 1200 cars and switch to FD2R.

the major hurdle as far as i'm concerned is supply of FD2R and also whether Honda Aus ppl are as dedicated as the Malaysian on pushing Honda R&D.

given all the hype, i believe they can sell more FD2R than FN2R.

[aaronng]

I was under the impression that the FD2R if it came out here it would be priced more towards the $50k mark based on the Malaysian prices (RM200k).

I just hope that Honda Austrlia wakes up and gets with the plan. Every other manufacturer is ramping their image up, even Toyota with every dealership having a TRD section! One can only hope. At least they are playing their Legend ads during primetime now, caught it once last night.

The Malaysian price of RM200K includes the 170% import tariff (1800-1999cc engine displacement) because the FD2R does not qualify for the ASEAN free trade agreement since it is made in Japan.

[JaCe]

Hey Aaron, would you know about the standard FD in Malaysia? My cousins said it's subject to a lower tariff because it's locally assembled or uses local parts (or something to that effect)- any ideas?

[Philip Lee]

normal FD would have lower tariff cos i believe they're made in Thailand.

FD2R is made exclusively at Japan so the price is inflated.

[aaronng]

Hey Aaron, would you know about the standard FD in Malaysia? My cousins said it's subject to a lower tariff because it's locally assembled or uses local parts (or something to that effect)- any ideas?

Yes, the normal FD1 and FD2 are made in Thailand and are subject to AFTA tariffs, which are 5% for CBU (assembled car) and 0% for CKD (kit delivered from Thailand and assembled locally). It used to be 15% up to about 2006 for CBU because Malaysia was pulling a dodgy even after the AFTA agreement for 5% was in force.

[JaCe]

Thanks guys. Someone else told me that it was assembled in Melaka...

But anyway, thanks for the info guys. Last time I went back every FD I saw was fitted with a Mugen (replica) kit lols...

[aaronng]

Thanks guys. Someone else told me that it was assembled in Melaka...

But anyway, thanks for the info guys. Last time I went back every FD I saw was fitted with a Mugen (replica) kit lols...

It could be built in Thailand, delivered as a kit to Melaka and then assembled there just to get around that last 5% of tariffs.