Honda Honda started from 1963 with the first Honda sport car release and after that

Honda kept working on automobile, motor, power product and develop some new technology on helping the environment. Until now, the brand is still improving and their businesses are around the world. You can see the H logo in every corner of the world. The brand mission is to maintaining a global viewpoint; we are dedicated to supplying products of the highest quality, yet at a reasonable price for worldwide customer satisfaction. And their management policies are proceeds always with ambition and youthfulness. Second, respect sound theory, develop fresh ideas, and make the most effective use of time. Third, enjoy work and encourage open communication. Forth, strive constantly for a harmonious flow of work. Fifth, be ever mindful of the value of research and endeavor.

They think dreams inspire us to create innovative products that enhance mobility and benefit society. To meet the particular needs of customers in different regions around the world, we base our sales networks, research and development centers and manufacturing facilities in each region. Furthermore, as a socially responsible corporate citizen, we strive to address important environmental and safety issues.

Honda is one of the biggest Japanese brands. The logo H is common and famous. Their products Accord and Civic are the most popular car models of Honda; also they are very attractiveness for the market. Honda Motor Co., Ltd. operates under the basic principles of "Respect for the Individual" and "The Three Joys" - commonly expressed as The Joy of Buying, The Joy of Selling and The Joy of Creating. "Respect for the Individual" reflects our desire to respect the unique character and ability of each individual person, trusting each other as equal partners in order to do our best in every situation. Based on this, "The Three Joys" expresses our belief and desire that each person working in, or coming into contact with our company, directly or through or products, should share a sense of joy through that experience. In line with these basic principles, since its establishment in 1948, Honda has remained on the leading edge by creating new value and providing products of the highest quality at a reasonable price, for worldwide

customer satisfaction. In addition, the Company has conducted its activities with a commitment to protecting the environment and enhancing safety in a mobile society.1 History Honda starts from 1960s and they experience a lot, here is the time line of Honda and from their homepage. 63 Hondas automobile business begins with the release of its first sports car (S500) and light truck (T360).

'67 '68 '69 '70

Front-wheel-drive minicar, N360, released. N Series of minicars tops Japanese sales. Automobile production in Taiwan begins (first overseas production of Honda automobiles). N360 top seller in Japan for its first three years. Z and Vamos minicars released.

'72

Civic released. CVCC low-emission engine first to comply with 1970 U.S. Clean Air Act.

'75 '76

Automobile production in Indonesia begins. Accord released.

1980's

http://world.honda.com/profile/overview/

'82 '86 '88 '89

Automobile production in the U.S. begins (a first for Japanese automobile manufacturers). Acura brand launched in the U.S. (first Japanese luxury automobile brand). Total automobile production reaches 15 million units. Accord becomes best-selling car model in the U.S.

1990's

'92 '95

Worldwide automobile production reaches 20 million units. Worldwide Civic production reaches 10 million units. Worldwide automobile production reaches 30 million units.

'97

LEVs (low emission vehicles) Civic Ferio and Partner 1.6 released. Leasing of EV Plus electric vehicle begins in the U.S. Insight hybrid released.

'99

2000's

'01Automobile production reaches 10 million units in the U.S.

Fit and Civic Hybrid released. '02Leasing of FCX fuel-cell vehicle begins in Japan and the U.S. Fit achieves No.1 annual sales among domestic registered vehicles.

'03Worldwide automobile production reaches 50 million units. '05Leasing of FCX fuel cell vehicle for home use begins. Worldwide sales of Honda hybrid vehicles reach 100,000 units. '06Sales of Bioethanol-compatible Flexible Fuel Vehicle (FFV) models for Brazilian market begin. Acura brand launched in China. '08Leasing of FCX Clarity fuel cell vehicle begins in Japan and the U.S. '09Insight hybrid vehicle released. '11 Brio compact car introduced in Thailand and India

Strategy Honda is an international company. Their business expend to Euro, America, Africa and the many places. When they are getting into different countries, they will adopt different strategies. For example the will use joint venture to get into the China market, Greenfield to start their business in Spain. Although Honda started from zero in Spain, they still do location in there and hope to adopt the local culture. On the other hand they also keep the quality in a high range. The below is the environment analysis and the strategies. After all is our recommendation.

Business over all evaluation Honda Motor Company, Ltd. is a Japanese public multinational corporation primarily known as a manufacturer of automobiles and motorcycles. Honda has been the world's largest motorcycle manufacturer since 1959, as well as the world's largest manufacturer of internal combustion engines measured by volume, producing more than 14 million internal combustion engines each year. Honda surpassed Nissan in 2001 to become the second-largest Japanese automobile manufacturer. As of August 2008, Honda surpassed Chrysler as the fourth largest automobile manufacturer in the United States. Honda is the sixth largest automobile manufacturer in the world. Honda was the first Japanese automobile manufacturer to release a dedicated luxury brand, Acura, in 1986. Aside from their core automobile and motorcycle businesses, Honda also manufactures garden equipment, marine engines, personal watercraft and power generators, amongst others. Since 1986, Honda has been involved with artificial intelligence/robotics research and released their ASIMO robot in 2000. They have also ventured into aerospace with the establishment of GE Honda Aero Engines in 2004 and the Honda HA-420 HondaJet, scheduled to be released in 2012. Honda spends about 5% of its revenues into R&D. Honda mainly handles several businesses which include automobile, motorcycle, power equipment such as tiller, blower, sprayer, trimmer, engines, robots, aircraft, solar cells, mountain bikes. We will concentrate on the automobile business. Honda did great in automobile business. As many countries are developing. The need of automobile is always rising. The market is big in China, India and of course includes our target - Spain. As one of the selling point of Japan-produced car is the low price. It is easy to enter different market. When Honda can aim on the market need can formulate suitable strategy, there will be great revenue. For example, India needs motorcycle. China needs low-price automobile. Spain pursues high performance. Honda also manufactures internal parts of automobile, which show its hightechnology. Through the process of inventing new engine repeatedly, it will raise its position of automobile-industry. For example, Honda engines powered the entire 33car starting field of the 2010 Indianapolis 500 and for the fifth consecutive race, there were no engine-related retirements during the running of the Memorial Day Classic.
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Also Honda manufacture a robot called ASIMO, which is created to be a helper to people. These showed the high level of technology of Honda. The following figure shows the market position of Honda, with high fuel prices and a weak U.S. economy in June 2008, Honda reported a 1% sales increase while its rivals, including the Detroit Big Three and Toyota, have reported double-digit losses. Honda's sales were up almost 20 percent from the same month last year. The Civic and the Accord were in the top five list of sales. Analysts have attributed this to two main factors. First, Honda's product lineup consists of mostly small to mid-size, highly fuel-efficient vehicles. Secondly, over the last ten years, Honda has designed its factories to be flexible, in that they can be easily retooled to produce any Honda model that may be in-demand at the moment. Nonetheless, Honda, Nissan, and Toyota, were still not immune to the global financial crisis of 2008, as these companies reduced their profitability forecasts. The economic crisis has been spreading to other important players in the vehicle related industries as well. In November 2009 the Nihon Keizai Shinbun reported that Honda Motor exports have fallen 64.1%. Honda is the largest motorcycle manufacturer in Japan and has been since it started production in 1955. At its peak in 1982, Honda manufactured almost 3 million motorcycles annually. By 2006 this figure had reduced to around 550,000 but was still higher than its three domestic competitors. During the 1960s, when it was a small manufacturer, Honda broke out of the Japanese motorcycle market and began exporting to the U.S. Taking Hondas story as an archetype of the smaller manufacturer entering a new market already occupied by highly dominant competitors, the story of their market entry, and their subsequent huge success in the U.S. and around the world, has been the subject of some academic controversy. Honda get a great success because they had sought a very high scale of production (they had made a large number of motorbikes) in order to benefit from economies of scale and learning curve effects. Also Hondas success was due to the adaptability and hard work of its staff, which tell us human capital is very important. Honda's solar cell subsidiary company Honda Soltec started sales throughout Japan of thin-film solar cells for public and industrial use on 24 October 2008, after selling solar cells for residential use since October 2007. As environmental protection has become a important issue. It is a good opportunity to expand their business. Actually there are Japan automobile companies such as Toyota, Nissan; they are all having a similar selling point- low price but high performance. Especially Toyota has
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high selling revenue in Spain. To have a high competitiveness with these company. Higher technology include performance, outlook is needed. Once the market has met the saturation, they have to keep competitiveness by the other new features in order to open new market, For example, the new engine, to eliminate the old one.

Strategy and evaluation Production Strategy In Spain, HONDA adopts differentiation as their strategy. Over 64% of CEOs globally believe new products and services will lead their enterprises growth. By using a differentiation strategy, they adding value to a product so that customers are willing to pay more for it. The higher the value customers place on a firms products, the higher the price the firm can charge for those products. Appropriateness There is a large demand of motors in Barcelona after the law published. So, the strategy to increase the mass product is appropriate the market needs. Also, HONDA can maximize their profit and reduce the cost. We should know that HONDA need to identify how production and logistics can be conducted internationally to lower the costs of value creation and add value by better serving customer needs. There are three important strategic objectives: lower cost, better quality, higher productivity. Obviously, HONDA in Spain Barcelona wants to have a higher productivity due to the higher demand of motors. At 2005, only 30% area of the factory located in Santa Perpetua de Mogoda, Barcelona of Montesa HONDA was used as production. Therefore, Montesa HONDA had enough space for building new factories and mass productions. Moreover, we need to concern about the quality. If there are poor quality products that cannot be sold, it leads to a direct reduction in number of units. The sales of Montesa HONDA motors increase from 2004, hence, the quality maintain a acceptable level. Also, Montesa HONDA was developing electric motors in Spain from 2004. The quality was improving. Honda in European has also been awarded the following quality control standards: ISO 14001, ISO 9002, and OHSAS. It should be mention that firms must meet the standards set forth by ISO 9000 before the firm is allowed access to the European marketplace. By improving quality, we can reduce the costs and increase the productivity. From the results of sales, we can see that the production strategy of HONDA in Spain is effective. They need to increase the productive by building more factories and improving the quality to satisfy the large demand of motors in Barcelona.
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Multi domestic Strategy Montesa HONDA, the subsidiary company of HONDA in Spain Barcelona, increased their mass product in 2005. It was because the Spain government passed the law which is the holder of driver's license (cars) according to the format of the European Community could drive the motors which are below 125cc. The demand of 125cc motors had a large increase. The supply of that became not enough. Barcelona is a city in Spain which had a lot of drivers of motors. Nowadays, 30% of registered vehicles are motors in this city. Montesa HONDA developing the electronic motors by testing EV-neo model motors now. Therefore, HONDA uses localization as their strategy in Spain. It increases profitability by customizing goods so that they match tastes and preferences in Spain markets. Appropriateness For the localization strategy, we should know it makes sense when there are substantial differences across nations with regard to consumer tastes and preferences and when cost pressures are not too intense. As we know, Montesa HONDA owns a big market share of motors in Spain. Therefore, market expanding is not a best method to maximize their profit. They should focus on the products. By customizing the goods to match tastes and preferences in the market, Montesa HONDA could achieve the goal. Localization strategy also had advantages, such as; customize product offerings and marketing in accordance with local responsiveness. There are pressures for local responsiveness arises from host government demands because economic and political demands imposed by Spain governments may require local responsiveness. Montesa HONDA borrowed 18 EV-neo electronic motors to a driver group RACC in Spain Barcelona to undergo some test for different usage of motors in July of 2011. RACC did some analysis on research, methods of use, time re-charge, and after-use feeling. The Barcelona government encouraged the use of electronic motors by taxes policy, building of re-charge stations, etc. Because of the push of government, the taste and preferences of consumers may change. Montesa HONDA develop electronic motors in Barcelona is a way to accordance with local responsiveness. However, all strategies have their disadvantages. First, localization will inability to realize location economies since localization is a product-oriented strategy (i.e. the firm did not base on economic, political and cultural conditions) Second, it will be fail to exploit experience curve effects which is refers to the systematic reductions in production costs that occur over the life of a product. Last, it will be fail to transfer
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core competencies to foreign markets. It was because the customize products are suitable for local consumers only. It cannot be transfer to foreign markets. Although there are some drawbacks of the strategy, it still is successful and effective in Barcelona. Entry strategy The firm owns100% of the stock and it can establish the whole subsidiary in a foreign market is called wholly owned subsidiaries. The firm can set up the firm in the country from zero. It can help to learn the location culture and experience the local economy. Appropriateness Honda chooses the wholly owned subsidiaries to establish their business in Spain. In 1986, their motorcycle production in Spain begins. This is the first time Honda going into the Spain and starts their business. The firm sets up the whole business in Spain of Motorbike, also it can say as Greenfield venture. In the Motorbike aspect, Honda is playing a leading role in the world. They play well in Motor GP, one of the famous motor races in the world; it implies that Honda has a leadership technology on making motorbike. Then, the protection of the high and unity technology is very important for the company. it will affect the future development and the profit. Only Greenfield venture or wholly owned subsidiaries can match the requirement of the companys development in the future. The company starts with Greenfield can own whole of the company, including asset, capital and the technology. In 1984, it is a start of the Euro economy, the citizens will go out for work and the public transport system did not establish. Then, the country needs some transport tool and cause of the country is not wealthy enough to own a car and the basic transport infrastructure wasnt built yet then the motorbike will be a helpful tool and the only choice in the Euro city. Besides, when Honda entered into the market, there are no incumbent competitors to be acquired, and then the Greenfield venture mat is the only mode. The later years show that the Honda had done a good decision in expends the motorbike market to Spain. The total amount of motor sale was increase in the following fifteen years2. To evaluate the entry strategy, we have to admit that it is a risky and high costing http://www.webbikeworld.com/motorcyclenews/statistics/motorcycle-sales-statistics.htm
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strategy. It is the common disadvantages when using the Greenfield or wholly owned subsidiaries strategy. However, the main point is the control of the strategy and can it be profitable. In the past ten years, the sales of the Honda motor are performing well and it proves this is a useful strategy if the firm can plan and control it well.

Recommendation Expend the size Nowadays, the Spain is suffering the economic downturn and the unemployment rate is high, about 16%, and the trend seem to be worse. Then, it is a great time for any large company to enter and establish their business because of the lower price level and enough human power. Honda automobile sale is not performing well in the Euro market. One may because of the strongest competitor Toyota is playing well in these ten years and earn many trusts from the customer. However, Toyota cant keep the high performance in every single year, in recent; the Toyota had been found some production mistake on their car and loses much loyalty from the Euro and America consumer. It is a chance for Honda to enter the Spain market. Base on the well establishment of the Motorbike market, Honda can build a factory to do the set up step. It can help Honda to save cost of transportation and logistics cost. It maybe a risky step for Honda but the brand can afford the cost and cause of their hybrid car is a cash cow for the whole company. If the firm can introduce the low fuel cost automobile into Spain and control the cost well the car must make lots of profit for Honda. Stimulate demand In these five years, compare to other Japanese automobile brand, Toyota and Nissan, Hondas sales performance in Spain is under expect. In 2012 February, the Hondas car cant get in top 10 sales amounts in Spain3. We may know that the Accord and Civic are popular car model in the other countries but not Spain. It shows that Honda still have lot of space to improve. On the other hand, the economic downturn didnt let the demand turn down. The total car sales volume of Spain in 2012 is increase 2.5%. The number implies the demand of the car in Spain is on the increase trend. Honda can stimulate the demand by building up the brand and increase the brand loyalty. Firstly, to build up the brand image must promote that Honda is environmental friendly company and they are very concerning the labor welfare. The
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http://bestsellingcarsblog.com/2012/02/05/spain-january-2012-nissan-qashqaileads-reaches-highest-share-evefor-the-second-time-only/

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promotions of Hybrid car and the low fuel cost function maybe helpful for Honda to build up the brand image. Secondly, if Honda is going to build up a factory and hire the employee in a reasonable wage level then the hiring can help to enhance the reputation of the brand in Spain and help to promote the spirit of Honda to the local citizen and it can keep the brand loyalty. In addition, in the past, car may be only focus on the male market and it provided a strong, functional, and individual image. However, the culture has changed, as the social class of female is increase and the female also has the purchasing power. Honda should put more budgets on advertisement to female. It can do it with the color, advertisement and any feminize design. Overview the whole industries, I think there are very few automobile industries focus on female market. If Honda moves fast, then they can be the leader in the whole industries and they can explore a new market. Brand future In the future, we may know that the hybrid technology may be the most common target for every automobile industry. All of them would like to join the market. Because of this reason the hybrid car market may be mature and the technology will become better and better. Honda should start developing the new technology, just like the new battery technology and other AI driving system. The innovative products are important for a high technology company brand image. Also, the invention can help the company develop a new product. Secondly, Honda should pay more attention on the youth education, for example, they can provide some advance course to the teenagers, or sponsor some youth activities. It can be an education to the customer and can enhance the brand loyalty. It is very popular in some famous brand, such as, BMW, BENZ. The car toys may the first image for the customer. This move can provide one more channel for Honda to touch the market and find out a new market. It will share the market budgets from the male market, but this is a potential market. It is worth our effort. Thirdly is the future image of the brand, the environmental friendly and innovative must be the image that many brands will follow. As one of the biggest automobile industries, Honda should be more than that. The social trend also requires a justice and fairness boss or company. Honda may increase their staff wage level. It may increase the running cost, but it can help to promote the fair business image. It is not a short term investment but a long term marketing activities. When the brand image built, the total value of the company must increase.
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