Honda sweetens Fit EV deal
Electric car now comes with collision insurance
LOS ANGELES – Honda Motor Co.’s new electric vehicle comes with an unusual option: collision insurance without any deductible.
It’s the latest enticement to move electric cars off showrooms and narrow the cost gap with less expensive gasoline-powered vehicles.
“It is a really interesting marketing tool,” said Rebecca Lindland, an analyst with IHS Automotive.
Detroit automakers have generally shied away from offering insurance for drivers. General Motors Co. experimented with the concept last year, offering a year of free auto insurance for new-car buyers in Oregon and Washington. GM let the offer expire without expanding the program because it was complicated to administer and the company wanted to spend the marketing dollars elsewhere.
Honda officials said they see the offer as a way to remove a barrier to the introduction of their first electric car in the U.S. They were concerned insurers would have trouble rating the financial risk of covering the repairs of such a low-volume vehicle.
Starting with Nissan Motor Co., large automakers began selling electric cars in late 2010. But sales of the vehicles have been slow, hampered by their limited range and higher price compared with gasoline-powered vehicles.
Although the amount of insurance savings for Honda’s new Fit EV will vary based on a consumer’s driving record and address, the option can reduce some of that expense.
Honda plans to offer just 1,100 leases for the car, an electric version of Honda’s popular subcompact hatchback. It will not be available for outright purchase. It reaches showrooms in July.