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End of the Line for Honda's CNG-Fueled Cars, Civic Hybrid, and Accord Plug-In

Honda announced that low gas prices contributed to low demand for the Civic Natural Gas, the only compressed natural gas (CNG)-powered car for sale, the Civic Hybrid, and their first plug-in hybrid-electric vehicle, the Accord.
June 18, 2015, 1pm PDT | Irvin Dawid
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"The recent decline in gasoline prices has reduced the price advantage of natural gas," writes The Wall Street Journal's automotive reporter, Mike Ramsey. "Plus, [John Mendel, executive vice president of American Honda] said, the scarcity of refueling stations became too much of a sales hurdle."

[Mendel] said the discontinued models had very little demand and the company is now focusing on a new set of technologies. They include a hydrogen-fuel-cell model due out in 2016, as well as an unnamed plug-in hybrid and full-electric vehicle [EV] that will go on sale by 2018.

"The fuel cell vehicle, battery-electric car and plug-in hybrids "will become a mainstream, volume pillar for the Honda brand," Mendel told Automotive News, replacing the Civic Natural GasCivic Hybrid, and Accord Plug-In."

Another reason for the poor sales of alternative fueled and hybrid vehicles is that conventional, gas-powered vehicles have become more fuel efficient. "Honda is dropping the Civic Hybrid in part because it expects the redesigned 2016 Civic to offer "a few ticks more" than 40 mpg, according to Mendel," writes Neal E. Boudette of Automotive NewsCombined with low gas prices, the gas savings from the hybrid model compared to the non-hybrid is greatly reduced. 

The fuel cell vehicle (FCV) model might seem odd after Mendel referred to "the scarcity of [CNG] refueling stations." Here's how he explains it:

Honda has invested $14 million in conjunction with California-based First Element to develop hydrogen fueling stations.

Mr. Mendel said that government support for fuel cells is stronger than for natural gas, and that the involvement of Toyota Motor Corp. and Hyundai Motor Co. in fuel-cell vehicles will help build a market.

But there is good news to report to end this post on Honda, although it doesn't involve fuel efficient cars but fuel efficient SUVs. The new HR-V, a crossover rated at 35-MPG on the highway has achieved record sales for any new vehicle models, according to Bloomberg News on June 15:

Honda’s bigger CR-V is the best-selling sport utility vehicle in the U.S. through May, a beneficiary of lower gasoline prices that have fueled the auto market to its fastest sales pace in a decade. With the HR-V, a taller twin to the Fit subcompact, Honda is betting that smaller models will withstand a slowdown the next time pump prices rebound.

A final note on new, for-sale CNG passenger vehicles. Pickup trucks powered by CNG are still available by Ram and Ford, while GM offers bi-fueled vehicles.

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Published on Monday, June 15, 2015 in Wall Street Journal
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