Honda wasn’t the most successful company in Thailand’s first eco car phase, but will be hoping for a better phase two. The Bangkok Post reports that the Japanese automaker is confident it can succeed with its new eco cars after failing to meet production requirements in phase one. Turning the Honda City into an eco car is the reason behind the company’s confidence.

The Thai government launched the first phase of the eco car scheme in 2007, and the second phase in 2013, to attract investment from carmakers. Phase one players Nissan, Honda, Mitsubishi, Suzuki and Toyota signed up for phase two, and the class now includes Mazda. Presently, Toyota and Mazda are leading the eco car sales charts.

According to the daily, Honda’s Brio hatchback and Brio Amaze sedan eco cars, launched in 2011 and 2012 respectively, enjoyed good sales until 2013, propelled by the then government’s first-time car buyer scheme.

Sales of Honda’s two eco cars dwindled from 6,195 units in 2014 to just 2,132 units last year. Honda Thailand’s COO Pitak Pruittisarikorn admitted that Honda did not meet the first phase’s requirement of producing 400,000 eco cars.

“Honda decided to end the first phase this year, so the privileges from the Board of Investment (BoI) Honda received under the first phase will be calculated on our actual output since 2011. The limited sales volume of eco cars was caused by market competition and sentiment of the six car makers in this segment,” he said.

Five years ago, Honda won Thailand BoI phase two eco car privileges, and it has committed to invest 8.16 billion baht (RM1.13 billion) to make 100,000 units a year. Production has to start this year, and Honda has met the deadline with the fifth-generation City, which was officially launched in Bangkok yesterday.

The City wasn’t an eco car in its previous incarnation. With a 1.5L engine (the eco car cap was 1.2L) and CO2 emissions of 133 g/km, the B-segment sedan was subject to excise tax of 20%. Now powered by a downsized 1.0 litre three-cylinder turbo engine, the larger and faster new model emits 99 g/km of C02 and attracts just 12% excise tax. With that, Honda Thailand has been able to reduce the sticker price of the new City by up to 40,000 baht (RM5,538).

Among the eco car phase two criteria are Euro 5, CO2 emissions below 100 g/km, fuel consumption not exceeding 4.3 litres per 100 km (23.25 km/l) and ABS/EBD/BA/VSA standard across the range.

The “booted Jazz” has been a success for Honda, with cumulative sales of 690,000 units in Thailand and four million units in 60 countries worldwide. Even at the final stretch of its life cycle, the City found over 100,000 homes in Asia and Oceania in the first nine months of 2019.

For full details on the Thai-spec 2020 Honda City, check out our launch report from yesterday, as well a comparo with the also-new Nissan Almera, Toyota Vios and Mazda 2 Sedan.