Honda expects sales increase in 2006

Honda is expecting to sell over 3 million cheap new cars worldwide by the end of the year, with extra growth predicted for 2006.

The US will see an expected 1.45 million sales, making a four per cent increase and European sales will rise to 285,000, which is a jump of 11 per cent.

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As a consequence, Honda estimates annual profits from its cheap new cars will be up $2 million to a total of $4.2 billion ? a record high for the fifth consecutive year.

Meanwhile, Honda is aiming to promote its fuel-efficient cars in the American market. Analyst Norihito Kanai said: "Honda's line up in the US seems to be the best fit for the market as there is huge demand for fuel-efficient vehicles.'

He added: "The automaker has one of the most flexible production systems in the world, letting it shift models around to meet demand.'

Sales for fuel-efficient cheap new car models reached a record 8.6 per cent for the US in November, with Honda grabbing market shares from GM and Ford in the process.