Presented by,

Aniket Lokhande

Shruti Lotlikar

Ashay Duri

Vikrant Datar

CASE ON

HONDA IN NORTH AMERICA

Khushbu Nehita

Ashay Chaudhari

Harshal Parikh

CONTENTS• Honda• Honda Overseas• US market potential• Restraint Agreement• Why Ohio?• Challenges in Ohio• Management success story

HONDA• Founded by Mr. Soichiro Honda and Mr.

Takeo Fujisawa in 1946• Mr. Honda was in-charge of engineering

and Mr. Fujisawa of management• Honda found it difficult to remain

profitable in Japanese industry.

HONDA OVERSEAS

• In 1958, a study grouped formed by Honda for study of overseas market bypassed US because it foresaw little demand for its motorcycles

• In 1959, a small team was sent to california• Honda first attempted to sell cars in US in 1969• By 1976, Honda was dependent on US for 50% of its

sales• In 1977 Honda established a motor assembly plant in

US.• In 1979 Honda established an auto assembly plant in

Ohio.

US MARKET POTENTIAL

RESTRAINT AGREEMENT

Sharpe decrease in US Auto makers Share

WHY NORTH AMERICA?• Sharpe decrease in auto-makerss

means unemployment for auto workers• Union of Auto Workers was very excited

about new investment in North America as it meant more jobs

• UAW put pressure on government to attract Honda to put plant in north America

WHY OHIO?• Honda received several forms of assistance

from state of Ohio-• Improved infrastructure around the

plant site• Abatement of property tax• Access to Transportation Research

Center operated by Ohio State University• Setting up of Special foreign Trade zone

WHY OHIO?• Ohio took on the obligation to build a 30

km Four lane highway to connect Honda plant with nearest interstate highway

• Ohio had largest number of Japanese supplier, about 20% of total Japanese suppliers as compared to 15% in Michigan and Kentucky

CHALLENGES IN OHIO• Cultural differences• Unskilled workers• Language• Creating supplier base

MANAGEMENT SUCCESS STORY• Corporate culture: Neither Japapese nor

American• Extensive process for selecting

associates• Investment in people• Respect for individual• Honda installed pride in associates• High level of service

THAT’S ALL FROM OUR SIDE…..