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Are Some Honda Dealers Selling To Fleets?

Michael Sheena's picture

For years, American Honda has jealously protected its resale values by limiting sales to fleets. Now a report in the trade publication Automotive News suggests that Honda might be looking the other way.

Despite the huge spike in year over year sales for September, things are still pretty tough out there in the automotive market. In fact, this year Honda has actually lost a small amount of market share, a position that the brand is not really used to being in. This has led, some dealers accuse, the Japanese brand to look the other way as some dealers quietly phone up a fleet like Enterprise and dispose of a batch of cars to meet a stair-step incentive program.

Selling Batches Of Honda To Fleets Not Gaining Corporate Ire?

For its part, Honda says that its policies have not changed, that it continues to audit its dealers and "enforcement is alive and well." Honda dealers are supposed to tick a box indicating a fleet sale and then that sale is backed out of the retail contest. That is not the case according to one Saint Louis dealer who told Automotive News that while his dealership only uses "fleetail" as a last resort, Honda does not seem to hassle dealers like it used to when dealers might neglect to denote a few fleet sales.

Sales numbers are not just for bragging rights. Many times manufacturers will offer incentives that increase for every unit sold based on the total number. If your dealership only sold 50 cars, you would get $100 per car, but if you sold 100 cars, you would get $150 for every car you sold during that period. This will drive dealers to sell below cost to meet the higher quota or pick up the phone and call Enterprise. There are other incentives, like travel prizes, that will motivate dealers to pump up their numbers.

Honda still has the lowest sales to fleet of any major automotive brand. These relatively small infractions are not going to change that percentage by a lot. However, it can rankle its dealer body, pitting those who want to follow the rules against those who will do whatever it takes to win.

You can view our coverage of the 2011 Honda Odyssey with a review summary in this link, some interesting quirks about the Odyssey in this article, and coverage of the all-new 2012 Honda Civic and CR-V in this post.

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