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Honda Beats Ford, Toyota, GM in Safety

Zacks Equity Research

Honda Motor Co., Ltd. (HMC) was the clear winner in the new vehicle safety ratings released by the Insurance Institute of Highway Safety. Out of the 22 cars that received the “Top Safety Pick Plus” ranking six were the Japanese automaker’s Honda and Acura models. These include Honda’s Civic hybrid, the two-door and four-door Accord sedans, Odyssey minivan and Acura’s RLX and MDX.

Fuji Heavy Industries Ltd.’s (FUJHY) Subaru, Japanese automaker Mazda and Swedish manufacturer Volvo had three cars each in the list. Meanwhile, leading automakers like Ford Motor Co. (F), Toyota Motor Corporation (TM) and General Motors Company (GM) lagged. While two Ford and Toyota vehicles got the “Top Safety Pick Plus” ranking, none of the General Motors’ cars achieved it. Infiniti Q50, Mitsubishi Outlander and Mercedes-Benz M-Class were the remaining three vehicles that received the top ranking.

Meanwhile, only one General Motors car, Chevrolet Spark, found a spot in the "Top Safety Pick" list, which was the second highest ranking after “Top Safety Pick Plus”. Also one vehicle from Volkswagen AG (VLKAY), namely Passat, made it to this secondary list.

The Insurance Institute’s "Top Safety Pick” list comprised 17 vehicles. These vehicles failed to get the higher “Top Safety Pick Plus” ranking as they did not have even an optional forward collision warning system.

Meanwhile, there are 139 vehicle models that failed to receive any safety endorsement from the institute. The low number of cars that made the list this year was due to harder criteria. Last year, 130 cars achieved the top safety ratings.

The safety ratings not only act as a marketing tool for automakers, but also encourage them to enhance safety features in their vehicles as many consumers consider the safety ranking while making a purchase. This trend of improving safety features in automobiles is helpful in reducing car crashes.

Some automobile stocks worth considering at present include Tata Motors Limited (TTM), Ford and Honda. All these stocks hold a Zacks Rank #2 (Buy).

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