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Arriving only 5 years later, and amidst changing market winds and a COE price resurgence, the latest Vezel stands little chance of replicating 2016's success.

07 Oct 2021


The clock has just struck 12 midnight. 

As you celebrate the crossing over of the new year alone on in your room - sparklers whistling downstairs, raucous laughter next door, and mahjong tiles shuffling above - you sit and wonder what 2016 will be like here. 

Presenting: Singapore's national car
You don't know yet that Jay Chou is stopping by for his Invincible World Tour. Or that your plans for short-distance travel will be boosted (but just momentarily) when Singapore and Malaysia sign a MoU for a High-Speed Rail between Woodlands and KL.

You also don't know that soon, the roads will be awash with the different colours but same silhouettes of a recently revived crossover from Honda - the Vezel

Unless you were way ahead of your time in practising home-quarantine, you couldn't have missed the sudden explosion in popularity of Honda's venerable compact crossover. The encik in MINDEF HQ had a Vezel. Your rich friend was gifted a Vezel by her parents for her birthday. Oh wait - you drive a Vezel.

Five years later, a new Vezel has been announced. The surprising fact that it's already been in the market for a few months may raise eyebrows, considering just how inescapable the previous one was. Now, we ask: Where are our 2021 Vezels?

2016

Honda's pride and joy: The Vezel was a runaway success, putting Honda back at the top of the game
To give you an idea of just how much of a powerhouse the previous Vezel was, let's try running through some figures in one paragraph. Ready? 

According to Bestsellingcarblog, the Vezel was responsible for more than half of Honda's sales in 2016 (and yes, these were Vezels, parallel imported, not HR-Vs). Selling nearly 10,000 units, it propelled Honda into the top spot for new car registrations, bumping Honda's market share by 8% and dethroning the supreme Toyota. It granted Honda the market's best-selling car model of the year - a coveted title the Japanese carmaker hadn’t achieved since the Civic in 2008. Its sales alone also accounted for half of all Parallel Imports, and more than 10% of the entire new car market for the year. Phew. 

Those are the sorts of earth-shattering figures that some of our local dealers don't even dare to dream of. And they were pieced together, no less, by disparate conditions suddenly in alignment. 

Timing, timing, timing: Catching the start of a decline in COE premiums in 2016 was crucial
You may remember the ridiculous COE spike of mid-2013 - when Category A shot up to $90,000 at one point. (This is a friendly reminder that the Toyota Corolla Altis cost $150,000 then.) 

Coming off that sort of mountain range of prices, late-2015/early-2016 marked a gradual but significant decline. We know $50,000 sounds like a lot now - it still exceeds current prices - but the same amount can feel very different depending on whether it was preceded by $90,000 (as it was back then) or $35,000 (as it was just a year or two ago).

More importantly, the price decline was a sign that the market was stirring to life again. And so it did, as Category A continued falling to sub-$30,000 in 2019. In tandem, the Vezel's popularity rose and hovered stably at healthy levels.

With the base layer nicely laid, Honda's overnight superstar then started to find itself being lifted to record sales by other types of customers - those sitting in the rear seats. 

Grab, and a now-missing Uber, said "Hello and welcome!" almost too enthusiastically to the Vezel 
While Grab and Uber had quietly rolled onto the scene in 2012 and 2013 respectively, it wasn't until the 2015-2017 years that the ride-hailing market experienced its boom. Between 2015 to 2016, the PHV population jumped from just below 30,000 to above 50,000. The following year, it increased again to 68,000. 

As the tale goes, you can already guess which car was served fresh on a silver platter - big boot, fuel-efficient engine and plentiful passenger space all bundled into one metal package - to be devoured ravenously by Grab and Uber. Too ravenously in fact - the latter was caught in controversy when suddenly exposed for knowingly purchasing and leasing over 1,000 defective Vezels which had been issued recalls. 

But then the Vezel wasn't done - it had one trick left up its sleeves.

A hybrid variant was also key in sustaining sales of the Vezel, arguably taking the baton in 2017
In large part due to the groundwork of another ride-hailing-favourite, the Toyota Prius, Singapore's market was also starting to warm up to non-petrol engines. Brandishing the green, eco-friendly whip of fuel-efficiency, the Vezel put its petrol-powered peers into their rightful places (the Nissan Qashqai, and even the Mazda 3 come to mind) - behind it - by pulling ahead with a Hybrid variant. LTA records show 1554 non-petrol Honda SUVs sold in 2016 - undoubtedly all Vezels, since the only other Honda SUV only got a hybrid variant this year - with the number more than doubling to 3232 in 2017. 

2021 

The 2016 Vezel is still being listed for sale by some dealers (We're in 2021, alright - there's the new Jazz)
We've established that the previous Vezel chalked up sales figures matched by few cars in Singapore's automotive history. It was, in fact, ordered in such generous servings that some dealers are still in the midst of clearing stocks from 2016 and 2018 off their plates. 

But this is where we get to the less cheery stuff. 

As you've probably already lamented, COE prices are on the rise. It's important to note that at just above $100,000, the new Vezel (non-hybrid) doesn't cost that much more than the previous one did initially back in 2016. But it is the fact that quotas will continue to remain low, and prices, high, that makes the road ahead for the Vezel rocky on this front. 

Let’s also move past the price of COEs to the underpinnings of COE: The 10-year gap. 

Different demographics demonstrate different sorts of buying habits and different car-buying cycles  
Whereas customers of luxury marques may have pockets deep enough to be unrolled for every new model thrust upon them, the buyer demographic of the Vezel is likely very, very different. A middle-class motorist holds on to their car more than five years (maybe seven? Eight?), if not the full 10. And while the new Vezel is undeniably an upgrade - visually and under the hood - it is still a huge investment arriving too soon to justify the cost. 

The news then gets worse when we take a look at trends in COE renewal.

Even before COE premiums started picking up this year, data shows that more motorists had been starting to hold on longer to their cars. 

For Category A, the number of five-year COE revalidations held steady between the 13,000 to 15,000 range from 2016 to 2019, but 10-year COE revalidations witnessed an exponential increase, going from 2,700 to almost 10,400. While this is partially due to the leasing out of old cars as private-hire vehicles, a large portion also comes from owners who've maintained their old vehicles well and don't want to cough up a fresh six-figure sum for a new car. 

The Yaris Cross and Kicks e-Power have both risen to challenge what was the Vezel's niche
Finally, other competitors haven't held back to storm the budget segment. Compact crossovers like the Toyota Yaris Cross and Nissan Kicks e-Power both arrived with sub-100k price tags (at least at the point of debuting) and to much fanfare when they were released. Crucially, they also only came with hybrid drivetrains - the calling card of the Vezel was now instantly no longer an ace.

To understand how the goalposts have shifted, return your gaze as well to vehicle fleets. Strides Taxi famously brought in 300 MG5 EVs recently, while Grab and ComfortDelgro both have their own portions of Hyundai Kona Electrics already. (Gojek has declared plans; we’re still waiting). With the future going not half, but full-electric, it's unclear if the e:HEV Vezel will be considered as a replacement when current PHVs get deregistered, even three to five years down the road. 

Taking a step back

A 7-year gap between the current and previous generations helps to bolster the Honda Jazz's chances
Here, we note that the Vezel isn't alone in facing a sophomore slump. The Mazda3, released in 2019, also came way too soon for most existing owners to make a switch. But then it didn't have to contend with the current climate of COE prices. On the other hand, a model that is in fact arriving in the current climate, the Honda Jazz/Fit, endured a longer hiatus - enough to justify new car keys. 

Since we're obliged to consider the silver linings of this bleak picture, bear in mind that you, the individual driver, may at least stand to gain intangibly if you decide to make a switch against all financial odds. If fleets no longer want the Vezel, there's no Grabcar-stigma deterring you from a purchase yourself, eh? 

Will Kah Motor be able to steer the HR-V moniker to success this time round? Stay tuned 
Kah Motor may just also learn from its mistake. Chasing the Vezel's success back then, the authorised dealer brought in the HR-V too late, and at too high a price (with a lesser engine too according to some; the HR-V had a SOHC against the Vezel's DOHC), to be able to cash in on the craze. Some price tweaking could just change their fortunes this time.

Still, our bets are unfortunately on the new Vezel failing to find the commercial magic its predecessor did. The advantages back then were too great, and the odds stacked against it right now, too towering. 

Who knows though? For a gem of a car like this, we'd be more than happy to be proven wrong.

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vezel  hr-v  honda  2021  2016  coe  coe premiums  grab  uber  ride-hailing