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Honda Popularity In The European Market

Honda has been gaining popularity in the European market and it is among the fastest growing automobile companies in the world. However, the survival is a current challenge for many automobile companies due to the economic crisis. Besides, automobile manufacturers are acknowledging the changing consumer needs and preferences and trying to adjust accordingly. Honda is not an exception because it also has the purpose of reaching a larger target market and retaining its existing market share. In addition, it has to persevere with changing trends adopted by competitors. An example is the hybrid technology engine and LPG installations. The aim of the paper is to identify and expound on two major issues faced by Mr. Kristic.


Competitiveness of Honda Hybrids and how Consumers will React to the New Market Segment

The automobile industry is versatile, and manufacturers have to be innovative to remain competitive. Honda has been successful in maintaining its target market because it evolves its global operations to conform to the needs of the dynamic market trends, which ensures customer satisfaction. An example of such models is the new Jazz and HR-V. Moreover, Honda focuses on the production of cars that are pleasant to drive. In this regard, the product of Honda Company has been very competitive and efficient in their responds to its clientele. It explains why it has been very successful and maintained a certain market share. Even though Toyota is a bigger and financially stronger company, it lacks the fusion of elegance that Honda offers.

However, the recent trend initiated by other manufacturers is the production of hybrid vehicles. Despite this being the new tendency preferred by most consumers, Honda is apprehensive on how its consumers might respond. In addition, the recent market situation is worrying because the competition is intense and customers are making rational decisions even if they involve experimenting with different automobile manufacturers. The significant aspect is resorting to a manufacturer who if flexible enough to adapt to diverse customer needs. For instance, automobile consumers in Serbia have a low purchasing power and are more conscious on oil expenditure. In this regard, even though Honda has shown tremendous success over the years, the trend cannot be guaranteed in the future. It happens because its future success will depend on how the company changes its manufacturing tendencies in comparison to its competitors in the quest of retaining and satisfying its consumers.

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The change in manufacturing trends encapsulates acknowledging the driver’s desire to cut fuel costs as well as greenhouse emissions. In fact, hybrid electric vehicles are cleaner and quieter compared to gasoline engines. However, even though alternative fuel source might be increasing in popularity, the dominant choice for consumers is the conventional gasoline engine. Moreover, Honda is unsure whether the consumers’ reaction to the new market segment will be premised on its competitive advantage. An example of such an advantage is the cost benefit ratio and offering an image of an alternative premium brand.

How the New Trend of LPG Installations will Affect the Local Market for Honda

Furthermore, Mr. Kristic has been considering the idea of LPG installations and how the phenomenon would affect the local market. The trend is an important aspect in the automobile industry due to the increasing uncertainty of oil prices while LPG is cheaper than diesel and petrol. Besides, the transition from liquid fuel to gas has been a viable alternative for most consumers. Most automobile enthusiasts prefer this option because it guarantees a longer engine life and spark plugs. In addition, the exhaust fumes of such automobiles are more environmentally friendly. LPG is used for engines with single and multi-point injection systems. The technology applied is state of the art where liquid injection systems are computerized.

In this regard, Mr. Kristic was convinced that he needs to embrace the new tendency and represent its consumers what competitors were offering. However, he was not sure what the response would be or how consumers would react to the new market segment. Besides, entering any market is capital intensive and requires huge investments. Nevertheless, it becomes difficult to venture in such a market when one is uncertain whether they will generate a profit, a loss or recover expenses at least. This explains the predicament that confronts Mr. Kristic. Besides, he is under pressure to perform because he has to maintain the same level with competitors and establish various aspects of product differentiation. In fact, the consumers can also influence the product line because Delta automobiles order what is repeating to customer’s requests and in light of market trends. However, unlike German automobile manufacturers, Honda cannot make huge exceptions on one vehicle. Therefore, if it decides to commence LPG or hybrid vehicles, it has to make huge adjustments in product lines. Nonetheless, before it is achieved, there ought to be some certainty that the applied strategy will yield returns and, more importantly, customer satisfaction.


The popularity and effectiveness of Honda automobiles in Serbia is not certain due to the prolonged economic crisis and the highly competitive automobile industry. One of the most significant problems is the trend in regard to oil prices, as well as to what would be the main type of fuel in the future. The automotive industry has been experiencing a transitional phase and has shifted focus out of gasoline and diesel cars. This has led to the manufacture of hybrid electric vehicles that are an amalgam of gasoline engines and electric motors that improve fuel economy. Honda can retain its market shares by considering the industry tendencies and increasing its focus on electric vehicles.

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