Honda's stab at reviving its luxury Acura line will be a new, made-in-Indiana compact sedan with a lower sticker price than you'd expect from an Acura.
The Japanese automaker said Monday it will begin making a new Acura sedan, the ILX, priced at less than $30,000, next spring at its plant in Greensburg.
No new jobs come from the move, but putting production of the Acura model in Greensburg should solidify its standing within Honda's global system and help justify the decision to double the plant's workforce earlier this year, said plant spokeswoman Anita Sipes.
"It's a great opportunity for us," she said Monday. "It brings some stability, job security. This proves in one more (way) that we're here to stay."
Opened in 2008, the Greensburg plant makes Honda's value-priced Civic cars. Honda has invested $550 million in the plant and in October doubled its employment to 2,000.
Greensburg was picked to make the Acura ILX in part because the new car will be built on the same compact-size chassis as the Civic. That reduces the cost to Honda to retool the production line. Sipes wouldn't say how much Honda is spending to buy equipment and make other changes to the Greensburg plant.
Without revealing the name of the vehicle, Honda has been training some of the Greensburg plant's employees to assemble a new car model. On Monday, the plant's managers revealed the Acura name to employees at morning meetings, Sipes said.
There was no ceremony attached to the announcement and, in fact, employees and the public won't even see what the Acura ILX looks like until the design is unveiled Jan. 9-10 at the North American International Auto Show in Detroit.
The ILX, which will be the 5th Acura model made in North America, is critical to Honda's attempt to reignite buyer interest in its 25-year-old Acura line.
"The brand is in trouble," said Jessica Caldwell, an analyst for researcher Edmunds.com. "The consensus for many of the current models is the vehicles just look bland. They have to do something to capture people's emotions with styling."
Acura, like the overall Honda brand, is struggling this year from reduced production triggered by natural disasters and a model line that hasn't drawn as much attention as those of Volkswagen's Audi, Bayerische Motoren Werke's BMW and Daimler's Mercedes-Benz.
Acura sales slid 6.7% through November, to 110,170. That compares with gains of 15% for Audi, 12% for BMW and 12% for Mercedes' luxury models in the 1st 11 months.
Acura sales peaked in 2005 at 209,610.
Sipes wouldn't say how many Acura ILXs Honda wants to make each day in Greensburg. Civic production of 800 a day is close to the plant's 2-shift capacity, she said, so Civic production will have to be reduced to produce the ILX.
"It'll be an easy change," she said. "It's on the same production line."
Both gas and gas-electric hybrid Acuras will be made at Greensburg.
Sipes wouldn't reveal Honda's hoped-for production numbers for the ILX, but industry sources put the number at 40,000 annually once sales ramp up.
Although baby boomers account for the majority of luxury sales, Honda is bringing out the Acura ILX to prepare to sell to the children of boomers, who are entering the auto market, said Michael Accavitti, Honda's vice president of U.S. marketing. The group, born since about 1980, covers as many as 80 million people, he said.
"Gen-Y consumers aspire to luxury still, but they need some help getting there," he said. "They are projected to be the first generation in the modern era to earn less than their parents."
Call Star reporter Jeff Swiatek at (317) 444-6483.