Honda looks to the motorcycle to ride out worldwide recession
December 20th, 2008
As American auto companies continue to make more headlines than cars, the CEO of Honda gave his year-end speech in Tokyo Japan.
Following the trend of automakers worldwide, Honda is experiencing a slowdown in sales and feeling the credit crunch from the financial industry on several fronts. The Japanese manufacturer is so concerned about the current economy it shocked the racing world recently with its announcement to pull out of Formula One auto racing, although officials were quick to assure the teams in motorcycle racing series that Honda intends to continue its sponsorship and participation in the arena of two-wheeled competition.
The speech by Honda's CEO was given on a positive note but also included concerns over the global economy, 'The abrupt change involving the global automobile industry from mid-September of this year that was triggered by the financial crisis, forced all the automakers to change various plans over a very short period of time. The situation is worsening day by day and is showing no sign of recovery.'
Even in the growing motorcycle markets in emerging countries in Asia and South America, overall motorcycle sales experienced a slowdown in the latter half of the year due to the impact of the credit crunch.
Honda announced many different initiatives to help it deal with with the global crisis and the motorcycle appears to be riding out in front of them all for the Japanese manufacturer. The company will look to further developing its motorcycle line, noting 'motorcycle business...is the origin of Honda'.
The speech also included, 'History shows that motorcycles remain strong in a difficult market environment and have always supported Honda in difficult times. People showed renewed interest in the value of motorcycles which consume less fuel for commuting purposes as well as for their easy-to-own/easy-to-use efficiency.'
Honda will continue to look to the newly emerging countries in regions such as Asia and South America where motorcycles are being used for everyday transportation, long-term and steady market growth is expected despite some external factors such as changes in economic conditions. Worldwide, the company is focused on developing battery technology in order to produce a quality electric motorcycle for consumers.
One of the more surprising announcements in the CEO's speech was a 10% pay cut across the executive board as well as bonuses being reassessed based on the company's fiscal year which ends in March 2009.
With Honda closing some of its American based motorcycle production factories in early 2008 most likely still on the minds of Goldwing enthusiasts, it wasn't surprising to hear the Japanese company will continue to evaluate its worldwide production facilities for all its products over the next twelve months.
And in the world of marketing and sometimes intense corporate strategies, the last line of the speech appears to speak volumes about Honda's manufacturing philosophy and how they are viewing the ongoing economic crisis; 'Honda will continue earning even more smiles from its customers by creating attractive new products which only Honda can create.'
- 'Made In China' - Soon The World's Hottest Brand
- Scooter comeback
- Why buy a scooter?
- The Global Market for Electric Vehicles
- Hop on the scooter, you commuter
- L.A. Electric Bike Company Finds Big Market in Asia