The
story of how Acura was created, launched and then grew into a major
force in a competitive marketplace is a compelling testament not just
to the company's products, but to the people who had the foresight to
establish the first premium Japanese luxury car brand. History shows
that Acura not only redefined the luxury car, it permanently changed
the luxury marketplace from a slow evolution among a handful of
brands to fierce competition between many. While today Japanese
luxury brands are taken for granted, this was not the case in the
early 1980s, when the groundbreaking Legend sedan was still on the
drawing board.
The
early 1980s were a tumultuous time for the U.S. car market. Gas
shortages, economic malaise and new government regulations from the
1970s caused an upheaval in the public's buying habits and the
products available to the public changed dramatically. Small was big
and Japanese manufacturers such as Honda had forged reputations of
reliability, economical operation and low price that were the envy of
many competitors. Even the least expensive Honda offered a unique and
fun driving experience, and the company's reputation for reliability
was second to none. Honda had also established a record of
technological innovation (such as the CVCC engine) that consumers
embraced– and that sent competitors back to the drawing boards.
The
success Honda had enjoyed was emblematic of these changes. With the
right product (the groundbreaking Civic) at the right time (the gas
crisis of the early 70s), Honda sales growth had been phenomenal.
Subsequent models such as the Accord and Prelude proved Honda had
more than just good timing going for it. Following its philosophy of
assembling cars where it sells them, Honda embarked on an ambitious
plan to begin assembling cars in the United States and broke ground
on a new plant in Ohio in 1980.
As
work began on the Marysville, Ohio manufacturing plant, there were
signs of change in the car market. The economy was improving, and
luxury cars were starting to increase in sales volume. Manufacturers
such as BMW, Mercedes-Benz and Audi captured the public's eye with
aerodynamic designs that eschewed the chrome and excess of American
luxury cars of the 1960s and 1970s. With a blend of luxury and
performance, European manufacturers began to chip away at the high
end of the market as America's middle class expanded and found
themselves with more discretionary income than they could have
dreamed of a few years earlier.
Many
of these young professionals drove Honda cars when they were young,
but as their income grew, Honda did not have a more premium vehicle
for them to move up to. Special Edition Accords featured leather
seats, but even these limited-edition models couldn't qualify as a
luxury car. Instead, Honda owners seeking bigger, more luxurious and
more powerful cars were leaving Honda for Mercedes-Benz, BMW, Audi
and other European luxury brands.
In
1981, Honda had a new, larger sedan in the early planning stages. It
would be bigger than the Accord by a wide margin, feature the first
Honda V-6 engine, and be loaded with luxury appointments. It would be
sold not on the merits of its economy, but on its ability to thrill
its driver. Honda executives viewed it as the perfect vehicle to keep
upmarket intenders in the Honda family.
But
there was a problem. While the buying public had accepted Japanese
nameplates for their reliability and economy, luxury was another
matter. Conventional wisdom said that an economy car manufacturer
trying to take on the best from Europe was folly. However, Honda,
more than any other car company, had found success by defying
conventional wisdom.
At
the time that Honda was planning its move upmarket, there was little
in its product lineup that foreshadowed success. With just three cars
– the Civic, Accord and Prelude – it wasn't even a full line
manufacturer. While popular with both the public and media, all of
its cars were still clearly intended for the budget conscious. Prices
were affordable, and even the most expensive Accord sold for well
below $20,000. Basic luxury features, such as power windows and
leather upholstery, were in short supply in Honda products. While
nobody disputed that Honda built excellent vehicles, few thought it
had the luxury credentials to compete with the likes of Europe's
luxury brands.
The
new Honda sedan, later to be named Legend, was known internally as
the HX. Under the guidance of Tom Elliott, senior vice president of
automobile operations, the HX would become the cornerstone of a
luxury car division to compete with the likes of Volvo, BMW and
others. The HX's 24-valve fuel injected V-6 engine was powerful and
sophisticated. Its independent suspension and four-wheel disc brakes
promised the handling of a European sport sedan, but with the
compliant ride expected of luxury car buyers. And it would boast
equipment such as a premium stereo, air conditioning, anti-lock
brakes and power accessories. It would also cost nearly $20,000,
almost twice as much as the base price of an Accord in the early 80s.
The
problem of selling such an expensive car through Honda dealerships
was obvious. Not only would it overextend the already busy dealers
(which sold on average 600 cars a year), customers would likely balk
at the idea of such an expensive car wearing a Honda badge.
Ultimately, Honda executives decided that the HX was simply too large
and expensive to be sold alongside Civics.
Instead,
a new division would be created, one tailored to the needs and wants
of luxury buyers. It would be entirely separate from Honda, with
unique dealerships, first-class customer service and a sales
experience that would be second to none. The Honda division would
meet the needs of the mass market that shopped for value. The new
division would cater to luxury and performance. Internally, the new
division became known as Channel II.
The
idea of launching the world's first Japanese luxury brand was a
gamble. Launching it with only one vehicle – and an expensive one
at that – was too risky, so another vehicle was needed to fit below
the HX, but without diluting the luxury and performance image that
Channel II would ultimately have. Luckily, a solution was found in
the Japanese-market Quint-Integra. With a fuel-injected, twin-cam
16-valve four-cylinder engine, sophisticated chassis tuning and
eye-catching style, the Integra, was designed to put premium sporty
coupes such as the Volkswagen GTI on notice. Its style, technology
and performance complemented the HX and the new division. Later,
there were plans for a third car, one that would take on one of the
most prestigious and challenging markets in existence: exotic sports
cars.
In
February 1984, American Honda confirmed its upmarket intentions.
Channel II had been the subject of much speculation by the media, and
not all of it charitable. Some pundits regarded the idea of a
Japanese luxury brand – especially one from a company known mostly
for fuel-efficient transportation – as overreaching at best.
Despite
media speculation, work continued. It was important to keep the new
division as separate from Honda as possible. This meant new
dealerships, new service and parts divisions, new sales and marketing
… everything. Developing the sales network fell to Ed Taylor,
assistant vice president of the new division. Honda boasted an image
that appealed primarily to those looking to maximize their dollars.
The new division was aimed at European luxury intenders. This meant
that dealerships would have to extend a level of customer service
expected by a luxury car buyer, and go beyond even that to convince
buyers that they were buying more than just an expensive Honda. Paul
Pugh, manager of auto field service, handled the creation of the new
service network.
The
new division needed a name, and the task of naming Channel II fell to
Ira Bachrach's Namelab in San Francisco, Calif. The challenge was to
create a name that would convey the image and style for which the
upscale division would be known. And in September 1984, the new name
was officially announced: Acura. The name was derived from "acu,"
a form from Latin, meaning mechanically precise or done with
precision.
In
November 1984, potential dealers were gathered for a secret meeting
at the Anatole hotel in Dallas. American Honda executives Schmillen,
Elliott, Taylor, Pugh and American Honda president Yoshihide Munekuni
explained the dealership plan for the first time. The new dealerships
had to be separate facilities from existing Honda dealerships, and
couldn't even be adjacent to them. They would also have a distinct
look and feel separate from that of Honda dealerships.
But
there was more in store for the lucky few in attendance that day. For
the first time, people outside Honda headquarters would see the HX
and Integra. Reaction to the plan was mixed. While the cars
themselves were universally well regarded, Honda was a popular brand,
and some dealers thought that any car made by Honda should be
available through Honda dealerships. However, many more saw the
wisdom of separating the new cars into a new division with a new
image.
When
dealership selection began in February 1985, the criteria were
strict. Potential dealers had to have the capital to afford the
construction of a new dealership. Acura management insisted that they
be located in key markets, such as Los Angeles, New York, Seattle and
others around the country where luxury sales were strong.
Acura
would introduce new technologies to existing Honda service managers,
and Pugh established new service training centers in Los Angeles,
Atlanta and New Jersey. Hired in September 1985, service managers had
only a few months to master new Acura technology before the cars went
on sale at the end of March 1986. And there was a lot of new
technology to cover. Not only did Acura feature two completely new
engines, including the company's first V-6, but electronic fuel
injection, four-wheel disc brakes, double overhead cams and other new
technologies would also be standard on all the cars.
As
Taylor and Pugh established the dealer, sales and service networks,
the newly formed Honda public relations department invited a select
group of journalists to Japan for a first look at the cars in
November 1985. At the Honda test track in Tochigi, the media were
able to drive the Legend and Integra for the first time, and learn
the difference between the Honda and Acura products.
The
proof was in the driving. While some popular media still expressed
skepticism about the viability of a Japanese luxury brand, Motor
Trend disagreed, saying, "We think the odds of Acura's success
are heavily in Honda's favor, for the Legend is a terrific debut
automobile." Everyone who drove the Legend noted that the new
sedan was not a copy of a European or American luxury car, nor was it
a repeat of larger sedan models sold by Toyota and Nissan at the
time. "It is, in truth, a new approach to the market," said
Car and Driver. Praise was equally glowing for the Integra. "The
Integra falls right into the hotbed of intriguing fun cars priced
just a bit over $10,000, and we don't see how it can lose," said
Car and Driver.
On
March 27, 1986, the public finally got to see for themselves what the
automotive media meant. When the first 60 Acura dealerships opened,
it marked a turning point in the luxury car market. From that point
on, luxury benchmarks would not automatically carry a European
nameplate.
When
the first Acuras went on sale, doubt still ran rampant among the
general media and Acura competitors. On the day Acura opened its
doors, Schmillen appeared in a now-famous joint interview on NBC's
Today Show with the then-president of Volvo North America, who summed
up most European manufacturer's attitudes to Acura: "With all
due respect to the tremendous quality of low-priced Japanese
automobiles," he said, "I don't think they will ever be
able to penetrate the U.S. luxury market." Schmillen remained
unflappable. "We weren't even in this market 15 years ago, and
we've come from nothing to half a million, and we think we can
continue to keep that trend going," he said.
History
proved Schmillen right. By the end of its first year, Acura had sold
52,869 cars and had grown to 150 dealers. In 1987, sales continued to
climb, and Acura posted sales of 109,470 vehicles for the 1987
calendar year. Not only was this double the previous year's total, it
surpassed every European luxury-performance nameplate in the United
States including Volvo, silencing even the harshest critics, and
proving unequivocally that Acura was a major player in the luxury car
market.
Advertising
for the Acura line was aggressive, with a look and feel separate and
distinctive from Honda advertising. Acura was unafraid to compare
itself with the best European brands. The emphasis was on performance
and luxury, and the company slogan of "Precision Crafted
Performance" was backed up with a strong link between Acura and
the Honda Formula One teams.
By
the end of 1987 Acura had established its luxury car credentials with
an award-winning lineup of sedans and coupes. The Legend and Integra
had won comparison test after comparison test, proving the cars'
mettle to even the harshest critics. Accolades mounted; the Integra
and classic Legend Coupe – added to the lineup in 1987 – were
voted onto Car and Driver's 10 Best list, the Legend Coupe was voted
Motor Trend's 1987 Import Car of the Year, and Road and Track
selected the Legend Coupe as one of the 10 best cars in the world.
Perhaps
the most significant indication of the new division's success came
late in 1987, when both Toyota and Nissan announced plans to add
their own luxury divisions.
As
the 1980s gave way to the 1990s, Acura continued to make waves. Acura
continually topped JD Power's Customer Satisfaction Index Survey, the
Legend Coupe remained on Car and Driver's 10 Best list, and sales
continued to climb.
At
the Chicago Auto Show in 1989, Acura unveiled its crown jewel, the
third car in its tri-product approach to the luxury market. Having
proved it could compete with the world's best luxury cars, Acura took
on the rarified realm of exotics with the all-new NSX. The new exotic
showcased Acura technological leadership. It boasted the first
mass-produced aluminum monocoque body, the first engine with
electronic variable valve timing and lift (VTEC®), and the first
production engine with titanium connecting rods.
When
the media was finally able to drive production versions of the NSX,
the car's technological specifications and world-class performance
would have garnered accolades by themselves. But what made the NSX
special was its undemanding personality. After crowning the NSX the
winner of a five-exotic comparison test, Car and Driver said, "The
winning NSX has it all: stunning looks, a comfortable and inviting
cockpit, a rev-forever engine that's perfectly happy motoring around
town, and confidence-inspiring handling." Motor Trend put it
more simply, proclaiming that the NSX was "the best sports car
ever built."
Acura
hadn't sat still with its core products either. While the Legend and
Integra had helped redefine their segments and were still strong
sellers, both were redesigned in the early 1990s. The 1990 Integra
was larger, boasted a more powerful engine, more luxurious interior
and more refined ride and handling. It was followed in 1991 by a
larger, more powerful and more luxurious Legend sedan and coupe. The
new Legend solidified the model's place in the luxury market and
helped it maintain its lead as the best-selling luxury import model
in the United States for six consecutive years. Both cars expanded
Acura luxury credentials without diminishing the company's slogan.
In
1990, when the NSX debuted, the Acura badge appeared on cars for the
first time. It was designed to represent a set of mechanical
calipers, signifying the precision and attention to detail with which
Acura products were made.
But
by the early 1990s the luxury market had changed once again. Toyota
and Nissan introduced new challengers in 1990, and established
European players had realized that both their product and pricing had
to change to meet the new Japanese competition. The American economy
was facing yet another recession, and the yen had grown so strong
against the dollar that the price advantage Japanese cars had
traditionally enjoyed all but vanished. As a worldwide economic
downturn took hold, the luxury car market began to contract, leaving
all manufacturers with declining sales.
Acura
was well prepared for these events, and remained a major force in the
luxury segment with its core products. Despite the new models and
subsequent critical acclaim, Acura wasn't immune to the economic
realities of the time.
Acura
responded to the harsh reality of yen fluctuations in a unique
manner. It insulated itself from the currency market by assembling
some of its cars in the United States, becoming the first import
luxury brand to do so. The first car designed, engineered and
assembled in the United States was the 1997 2.2CL coupe, which was
quickly followed by the V-6-powered 3.0CL. As Acura sales began to
climb in the latter half of the decade, U.S. production increased,
and by 1999 more than half of all Acura vehicles sold domestically
were assembled in the U.S.
Acura
also began to expand its product lineup. The Vigor was introduced in
1992, filling a gap in price and size between the Integra and Legend.
As Acura began to shift its models to alphanumeric naming, the Vigor
was succeeded by the TL series. In 1994, a new Integra was introduced
that became a perennial Car and Driver 10 Best winner, and solidified
Acura in the sporty coupe market. The Legend was replaced by the RL,
which moved Acura's flagship considerably upmarket with innovative
features such as the first touch-screen satellite-linked navigation
system. Acura was also on the leading edge of the burgeoning luxury
sport utility market, with the 1996 introduction of the SLX, the
first sport utility from a luxury manufacturer.
Acura
continued its technological leadership. VTEC, which was introduced on
the NSX, quickly found its way to the rest of the lineup. The 1992
Integra GS-R, 1997 CL and the 1999 TL all used VTEC®. Today, all
Acura engines feature the VTEC® technology. Acura also blazed the
trail with navigation systems. Introduced on the '96 RL and improved
over successive generations, Acura continues to lead the category
with a GPS system that is acknowledged as the class leader.
In
the latter half of the 90s, the stock market was booming, the
Internet was a growing economic reality, and technology was working
its way into everyday life like never before. Luxury car sales were
increasing, and by mid-decade Acura sales were climbing again.
With
a solid reputation for technological innovation, Acura was poised to
redefine itself in the crowded luxury marketplace in a way that would
connect with a tech-savvy public. The first example of the
reinvigorated spirit at Acura was the 1999 TL. Like the CL before it,
the TL was completely designed, developed and assembled in the United
States. It boasted a long list of standard features. The only option
was a DVD-based navigation system. The new TL was an immediate hit
with the public and the press, and became the best selling car in its
class for three consecutive years. A year later a redesigned CL coupe
followed the TL to critical acclaim. It upped the ante as well,
offering a Type-S version that featured a 260 horsepower V-6 engine
and sport-tuned suspension.
In
2001, Acura again raised the bar with the MDX, its first SUV designed
and developed completely in-house. As yet another product developed
in the U.S., the MDX was an immediate success. Motor Trend named it
Sport Utility of the Year, it was voted North American Truck of the
Year, and Car and Driver named it the winner of the Luxury SUV
category in its 5 Best Trucks competition.
The
Acura reputation for innovation expanded with the MDX. The navigation
system was the industry benchmark. Its third row seat folded flat
into the floor, a feature that competitors simply didn't offer.
Variable Torque Management four-wheel drive gave the MDX off-road
prowess without sacrificing on-road capability. It was also the first
luxury SUV to meet ULEV (ultra low emissions vehicle) standards.
When
the CL was introduced in 1997, it marked the beginning of a new era
in Acura's history. Designed, engineered and assembled in the United
States, the CL set a precedent for future Acura models. The 1999 TL
was the second Acura product assembled in the United States, and was
quickly followed by the MDX sport utility in 2001, which is assembled
in Alliston, Ontario by Honda of Canada Manufacturing. Today, the TL
and MDX continue to be assembled in North America, along with RDX
luxury crossover SUV and the ZDX four-door sports coupe. In 2010,
nearly three quarters of the vehicles sold by Acura were assembled in
North America.
Driver
involvement was an important part of the Acura formula. By the 2002
model year, the TL and CL were both available in Type-S editions that
boasted a more powerful engine, sport-tuned suspensions and, in the
case of the CL Type-S, an available 6-speed manual transmission and
helical limited slip differential that Car and Driver said "closes
the front-drive versus rear-drive gap by a bunch."
The
public responded strongly to the Acura combination of high-tech and
driving pleasure. In 2001, Acura posted year-end sales of 170,469,
shattering the previous record set in 1991. And despite a short-lived
economic downturn in the beginning of the new century, Acura sales
remained strong, proving the value of its strategy of assembling cars
in the United States.
An
all-new second-generation TL debuted as 2004 model. Even more packed
with luxury features than the original, the new TL introduced
Bluetooth® HandsFreeLink®, DVD-Audio (DVD-A) and a remarkable
10-speaker Acura/ELS Surround® Premium Audio System to the luxury
ranks. Also for 2004, Acura launched the sleek TSX sports sedan that
was designed and targeted for Gen X, but proved to have a broad
appeal in the luxury market.
Following
up the launch of the advanced new TL, Acura followed with an all-new
second-generation 2005 RL. Strong and sophisticated, the Acura
flagship sedan turned heads with the most powerful Acura engine ever.
It also included groundbreaking Super Handling All-Wheel Drive™
(SH-AWD®), a Zagat Survey® feature for the navigation system, Bose®
Surround Sound audio system and a full AcuraLink® suite, plus a host
of other amenities.
For
2007, the all-new 5-passenger RDX hit the streets with futuristic
technology, performance and utility all wrapped into a "right-sized"
package. Features included a turbocharged engine (a first for a
production Acura) and standard 18-inch alloy wheels and tires.
In
2007, Acura debuted in the American Le Mans racing series and fielded
three teams to compete. At the famed 12 Hours of Sebring endurance
race, Acura engines powered to first, second and fourth places in the
competitive LMP2 class.
Styled
from start to finish in the United States, the innovative,
game-changing ZDX four-door sports coupe instantly commanded
attention when it debuted at the 2009 New York International Auto
Show. With its primary emphasis on the driver and front passenger
(rather than ultimate cargo and people hauling ability), the ZDX took
Acura in a whole new direction of personal luxury.
In
2009, Acura became the first car company ever to receive Top Safety
Pick honors from the Insurance Institute for Highway Safety (IIHS)
across an entire model-year lineup. Simultaneously, Acura was also
the only luxury brand in 2009 to receive Five-Star crash safety
ratings from the National Highway Traffic Safety Administration
(NHTSA) across the board for all its models. Additionally, the same
year Acura won ALG's Residual Value Award for Best Luxury Brand.
More
safety honors arrived for 2010, when all Acura vehicles (both
passenger cars and SUVs) again earned the highest score possible on
frontal offset, side impact and rear crash protection tests. And
Acura was once again the only luxury brand to receive five-star crash
safety ratings from the National Highway Traffic Safety
Administration (NHTSA) across all models. Also in 2010, Acura again
won ALG's Residual Value Award for Best Luxury Brand. The Acura ZDX
crowned a stellar year by being named as a finalist for Esquire's
"Car of the Year" award. The magazine called Acura's
all-new four-door sport coupe "the most gorgeous, thrilling,
undeniably American Japanese ride of 2010."
In
2011, Acura began its 25th Anniversary year by winning the 2011 ALG
Residual Value Award for Best Near Luxury Car. True to history, the
division then continued its advancements by unveiling the all-new
2011 TSX Sport Wagon, a perfect blend of performance and utility.
Making its debut at the 2011 Chicago Auto show, Acura's newly refined
2012 TL delivers fresh looks, improved performance and upgraded
technology.
Today,
Acura boasts the strongest, most extensive product line in the
division's history. The Acura brand appeals to customers whose sense
of prestige comes not from traditional status symbols, but from the
true sense of being ahead. This is because Acura is committed to
creating exhilarating, world-class luxury automobiles that use
technology not just to enhance the driving experience, but to make
their owners' lives better. Examples of driver-relevant technology
include Super Handling All-Wheel Drive™ that improve agility and
control, Adaptive Cruise Control (ACC), blind spot information and a
Collision Mitigation Braking System™ (CMBS™) that enhance safety.
Advanced Acura technology also includes Bluetooth® HandsFreeLink®
mobile telephone integration, plus a satellite-linked navigation
system that includes AcuraLink Real-Time Traffic with Traffic
Rerouting™ along with AcuraLink Real-Time Weather™ with radar
image maps that gives the Acura driver more control over their life.
The
automotive marketplace has changed significantly in the past 25
years, and it will continue to evolve and grow in the future. With
sport-utility vehicles (the MDX, turbocharged RDX, the expressive
ZDX), continued refinement of its luxury sedans (the RL, TL, and
TSX), and the introduction of exciting new products like the new TSX
Sport Wagon, Acura will remain on the forefront of the luxury
performance market for decades to come.
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