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Honda A

Group- Karthik, Mohit, Ramya, Rishabh, Sharvani, Shouvik,

Introduction
Leadership 19481973 Soichiro Honda The motorcycle market was controlled by the US and

UK before the emergence of the Japanese motorcycle industry Japanese entry into the world market was spearheaded by Honda motor company Honda entered the American and English market and highest market share in a short period of time.

Honda-Domestic Market
Honda established a Honda Technical Research

Institute for technological development in 1946 Honda introduced its first Atype, 2stroke Engine No of competitors in 1948- 247 Fully Integrated producers of engines, frames, chains etc by 1950 to gain competitive advantage

Motorcycle Market in US before


Harley Davidson was the market leader

Bad image of the motorcycle riders, as a trouble

maker.
British and US companies major supplier of the

motorcycles.

What is the strategy that has made Honda so successful in the motorcycle industry and in particular, the United states?
Established a subsidiary named American Honda Motor

Company unlike other foreign competitors Developed the market region by region High marketing and advertising expenses compared to competitors Market share and Sales volume was given priority High concentration on R&D leading to innovation New product to market in 18 months Created a large dealership network Built a strong selling and distribution network Offered multiproduct line Economies of scale

What indications do you have that the strategy was planned in advance?
List prices of vehicles across segments were high, with

high margins but it was considered cheap by the consumers. They had Cold storage of designs if market developed They entered keeping in mind to develop markets region by region They created a strong sales and distribution system with willingness to incur short term losses for long term gains High productivity based costing was an indication. Huge advertising expenditure

How did Honda discover this winning strategy?


They realized that the US Consumers had a Bad

image of the motorcycle riders hence created a campaign You meet the nicest people on a Honda Multiline products Interval between conception and production was very low. Products were redesigned if a threat was perceived. They increased the product awareness by huge advertising expenditure

Efficacies of Hondas Strategies


Sale rose from $500,000 in 1960 to $77 million in

1965. From 1959 to 1965, the production volume increased five folds from 285,000 to 1.4 million. Able to join 125 dealers in short span. Average growth rate was 14% Their market share varied from 34% to 61 % over all cc categories