Honda says cannot dictate prices to dealers

Honda says cannot dictate prices to dealers

A Honda Vietnam representative presents the Lead scooter at a ceremoney on December 24, 2008. Honda Vietnam cannot interfere with the pricing of its products by its exclusive dealers in Vietnam, the Japanese firm’s chief said.

But he rejected claims that Honda deliberately kept supply of the popular Lead scooter low to keep its price high. The scooter has become a hit since its launch last month, with many customers complaining they cannot buy it at Honda Exclusive Authorized Dealers (HEAD) despite registering many days in advance. “We can say for sure short supply [of Lead scooters] is not our intention,” Yasuhiro Imazato, director of Honda Vietnam in Ho Chi Minh City, said in a note to Thanh Nien Daily. Some buyers have been lucky enough to get the scooter, but had to pay VND35-39 million (US$2,000- 2,200), much higher than Honda’s “recommended price” of around VND31 million, a figure it has also posted on its website. “We’re really sorry that our supply of the product cannot satisfy the market demand,” Imazato said, adding he is “very surprised” at Lead’s sales despite the economic slowdown. His company has had to increase the monthly output of Lead to nearly 11,300 units from the original plan of 9,700, he said. He said many customers mistakenly think HEAD are Honda’s retailing outlets and have to sell at recommended prices. “In fact, HEADs and Honda Vietnam are business partners,” he said. “We cannot impose our retail prices on dealers, which will be a violation of the Competition Law.” Honda Vietnam has an annual motorbike capacity of 1.5 million units, 27 percent of them scooters. Reported by Vinh Son