Honda Motor Company has been a strong player in the global automotive market. The company's competitors in the US market have been working on providing lucrative deals to drive their sales. One of the top executive from Honda Motor Company has stated competitors have been indulging in 'stupid things' to boost auto sales in the country. The company has stated that competitors have gone up to an extent of offering seven-year-long car loans that can indeed harm buyers.
Carmakers have reportedly been selling the vehicles with 84-month loan commitment that indeed makes things difficult for the buyer as they would have to repay faster than cars lose value. At the North American International Auto Show that was held last week, John Mendel, Honda’s U.S. sales chief, said, “You’re ringing the bell on a new-car sale, but that customer is saddled — they’re stretched so thin.” Speaking on extended-term loan he added, “stupid not just for us, but for the industry.”
Speaking more on the occasion, Tom Webb, Chief economist at Manheim Consulting, said, “We’ve seen this movie before, we know how it ends, and it’s not pretty. But I say that it has longer to run, and we have already paid the price of admission. So we might as well stay to the end. You just keep your eyes on the exit door.”
