Honda’s hatchback struggle
In 2002, Honda introduced a nicely conceived hatchback version of the Civic known as the SiR. With a 2.0-litre engine and upgraded suspension, it was an instant hit with tuners and was generally well received—at least in this country. It was also the first hatchback the company had offered in several years. Honda, it seemed, was going back to its roots and getting back into the hatchback business.
Alas, the SiR only lasted until 2004 and was the last Civic hatchback the company produced. Nimble, versatile, and entertaining to drive, it ticked all the boxes and should have done well.
What happened? In a nutshell, Americans didn’t like it. In those days, Honda Canada took its orders from Honda USA, and American buyers have traditionally had an aversion to hatchbacks—along with small-displacement diesel engines and manual transmissions.
It wasn’t the only hatchback rejected by American buyers. The Chevy Optra, the Pontiac Wave, the VW City Golf, the Chevy Orlando, and the Mercedes B-class have all failed to make the cut down south but have done reasonably well as Canada-only models.
That said, it isn’t necessarily because Canadians and Americans have different taste in automobiles. Americans, said industry analyst Dennis DesRosiers earlier this year, just have more of a love affair with their cars than we do. “In Canada, cars tend to be a necessary evil—a way to get from A to B,” he stated, “whereas to many Americans, their car is a God-given right…a symbol of freedom.”
And that symbol tends to be more prestigious in flavour. “It’s about economics and psychographics,” Des-Rosiers continued. “The average week of net earnings in the United States buys you more car than in Canada. Americans buy more prestige automobiles than we do, and the core car market in the U.S. is a size higher than in Canada.”
There are also other factors at work. Generally speaking, the Canadian definition of value for money translates into a car that’s easy on fuel and dependable, with a reasonable level of comfort. To Americans, it tends to mean plenty of headroom, greater interior volume, and a more imposing presence. “How many intermediate or midsize hatchbacks are there?” asked DesRosiers. “None. Americans just go straight to an SUV.” A hatchback, no matter how well conceived, doesn’t make the same statement as a sedan or an SUV.
“Hatchbacks are kind of a middle ground,” explained Joe Veltri, NAFTA point man for Chrysler Group LLC, earlier this year. “In the U.S., SUVs, crossovers, and pickups are king—these are the markets that are growing right now. Hatchback buyers tend to be younger and are looking for more sporty performance with interior flexibility.” Chrysler is one of the few manufacturers not offering a hatchback model—aside from the Fiat 500.
Other factors include taxation and the price of fuel. Gas is still cheaper in the U.S. than in Canada, and we simply pay more for our cars up here. We also tend to drive our cars further. This results in different consumer behaviour in Canada, Veltri said. “It’s an interesting conundrum.”
Nissan—one of the major players in the hatchback market—knows exactly who’s buying its hatchbacks: everybody. “The average age for the Versa, for example, is around 50,” said Andrew Wilton, Nissan Canada’s chief marketing manager, in an interview earlier this year. “We’re getting empty-nesters and young intenders, both, and we definitely see opportunity for growth in this market.” Wilton explained that the “buyer split” between the Versa sedan and hatchback is 90 percent in favour of the latter—no surprise, then, that a new Canada-only Micra hatchback debuted earlier this year.
Like virtually every hatchback on the market, the Versa is also a global player. It’s sold around the world and is good for about one million units per year worldwide. Other popular hatches, such as the Ford Fiesta and the Mazda3, are also sold around the world in essentially the same form. “All the players in this market do it on a global basis,” explained Veltri. “You just can’t build a business model for a hatchback for NAFTA if you make it from scratch. It has to be global.”
Which leads us to the Canadian market. Aside from BMW, Chrysler, Cadillac, and a few others, all manufacturers offer a hatchback in one form or another. Some more than others: if you include Lexus and Scion, Toyota, for example, has no fewer than 10 different models on the market—and that doesn’t include SUVs or crossovers.
Meanwhile, Honda—the company that basically introduced the offshore hatchback to the North American market—is hanging in there with the ever-popular Fit and the low-volume CR-Z hybrid.