CASE STUDY ON HONDA

 During 1980s Leading the trend were the Japanese automobile companies,
particularly Honda, Mazda, Nissan, and Toyota
 Collectively these companies invested $5.3 billion in North American-
based automobile assembly plants between 1982 and 1991.
 The early leader in this trend was Honda, which by 1991 had invested $1.13
billion in three North American auto assembly plants—two major plants in
central Ohio and a smaller one in Ontario, Canada. Honda has invested an
additional $500 million in an engine plant in Ohio that supplies its Ohio
assembly plants.
 Honda says the domestic content of its American-built cars is 75 percent,
meaning that three-fourths of the final cost of a car is accounted for by North
American labor, components, and other costs. The remaining 25 percent
of the cost is accounted for by imported parts.
 Honda had considered establishing auto assembly operations in North America
as early as 1974 but ruled out investment then because of the high cost of
North American labor.
 . In 1977, Honda announced it had selected a site in the small town of
Marysville, Ohio, for a motorcycle assembly plant.
 Honda's internal feasibility studies still predicted that high labor costs and
poor productivity would make North American-based automobile production
unprofitable.
 Honda quickly realized that its assumptions about US workers' poor productivity
were unfounded, and in 1979 it announced plans to construct an automobile
assembly plant adjacent to its Marysville motorcycle plant
 In November 1982, the first US-built Honda was assembled, and by 1984 the
plant was producing 150,000 automobiles per year.
 By 1989, at least 29 major Japanese supplier companies had established
transplant manufacturing facilities in Ohio to supply Honda with component
parts.
 As a latecomer to automobile production in Japan, Honda had always struggled
to be profitable in the intensely competitive Japanese auto industry.
 Against this background, Honda's North American assembly plants can be
seen as part of a strategy designed to circumvent Toyota and Nissan and to
make major inroads in the United States market ahead of its Japanese
rivals. Underlying this strategy was Honda's strong belief that products need
to be customized to the requirements of local markets.
 Hideo Sugiura, the former chairman of Honda, there are subtle differences,
from country to country and from region to region, in the ways a product is
used and what customers expect of it.
 . If a corporation believes that simply because a product has succeeded in a
certain market it will sell well throughout the world, it is likely intended for
large and expensive errors or even failure.
 To produce products that account for local differences in customer tastes
and preferences, Sugiura claimed that a company needed to establish top-to-
bottom engineering, design, and production facilities in each major market in
which it competed.
 Its success can be judged by the fact that although it was only the fourth
largest automobile manufacturer in Japan in 1990 (with 9.3 percent of the
market, compared to Toyota's 32.5 percent), it was the second largest
Japanese automobile manufacturer in the United States (with 6.14 percent of
the market, compared to first-place Toyota's 7.6 percent).

EXTRA NOTES

 Soichiro Honda , Takeo Fujisawa is the founder of honda motors company

and it was fouded in 24 September 1948, Hamamatsu, Shizuoka Prefecture,
Japan
 Takahiro Hachigo became the new CEO and as his appointment coincided
with the launch of 5 new models in Europe, the automotive sector had an
increased internal profile.
 Takahiro Hachigo is a Japanese engineer and businessman, who has been
the chief executive officer of Honda Motor Co., Ltd.[1] , since June 2015.
 Prior to that, Hachigo was a managing officer at Honda, and started his
career at Honda in 1982 as a chassis engineer.