

Honda’s global strategy: Go local - clarkm
http://www.washingtonpost.com/business/how-honda-makes-globalization-work/2014/08/07/b84f16be-1cd0-11e4-ab7b-696c295ddfd1_story.html

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bane
Honda is fascinating to me. Making among the most consistently reliable cars,
at least according to every consumer survey I've ever seen. Their cars are
relatively no-frills, they usually seem to trail any technology trends in the
industry by a generation or two. They're kind of the Nintendo of the car
world. Never first, generally or always profitable, even when they look like
they're down.

They're basically the automotive embodiment of Gunpei Yokoi's "Lateral
Thinking of Withered Technology".

At least in the part of the world where I live, I can absolutely guarantee
that at any given stoplight, there will be at _least_ 1 Honda vehicle. They're
absolutely ubiquitous here. Honda buyers are also among the highest percentage
of returning customers...because their last car gave them something like 20
years of trouble free, reasonable cost driving. They're profitable even though
they're in 2 of the most competitive and lowest average profit automotive
segments in the world and their products last _forever_.

Yet there's some unusual things going on with Honda that I think is worth
paying attention to:

\- I'm frequently surprised, when I leave my local bubble, how few Hondas I
see. I remember first noticing it during a few travels to the midwest. At any
given stoplight, I could guarantee I _wouldn 't_ see a Honda. I'd definitely
see an American brands and usually a Toyota. These days I see a surprising
number of Hyundais, but outside of what seems to be fairly particular parts of
the U.S. Honda vehicles just don't seem to be that common.

\- I'm even more surprised when overseas how slim the Honda pickings are. I
think in a couple-three weeks in London I may have seen 3 Eurostyle civics.
Reading UK reviews the reviewers seem so...tepid on the vehicles. Comparing
them often unfavorable to notoriously unreliable VW and even worse, Peugeot
and Citroën, which are among the few automakers to make Ferraris and Jaguars
look like reliable automotive appliances. I'd say this says that UK buyers
don't really value reliability, but reviews of UK Fords are full of "if you
want a reliable car, this is a good car to get"...which is odd, since Fords,
while probably more reliable than _most_ European cars, are not terribly
reliable in comparison to Japanese cars (there about as good as Korean cars
are these days).

\- In Continental Europe I can't remember seeing more then 1, despite months
all over. In Korea, the American spec Accord was about as popular as a
Japanese car can be. But I've seen more Landrovers in Korea that Hondas.

\- On the flip side, their Japanese rival Toyota, is just about everywhere.
The Hilux is especially ubiquitous in harsher climates. I even owned one for a
bit (they're not nearly as indestructible as Top Gear makes them appear) and
it was fine.

\- Honda runs a surprisingly public and aggressive R&D program. Everything
from fuel cells to humanoid robots. The first in-car navigation system ever
was made by Honda. But they seem to take _forever_ before they trickle this
tech into their cars. The moment of commercialization for them seems to be a
generation or two after everybody else is doing it.

All of these things make me think Honda still has huge growth potential. If
consumers start to value what Honda is offering, they could easily be a #1 or
#2 in the world maker. As it is, consumer simply value other things (big
engines, styling, name cachet, whatever).

I think Honda takes an unusually measured approach in the industry. The last
couple generations seem strangely out of character. I've got this down to two
events:

1\. The rise of Korean cars. The weird stylish Accord and Civic from that
period, with their bizarre button filled, non-ergonomic dashes.

2\. Fukushima. The Honda generation from that period are _almost_ a return to
form, but they seem oddly unfocused in design.

However, but golly if the current generation seems like Honda back in form.
Boring, reasonably prices, unbelievably reliable appliances you ride in
reasonable comfort from a->b.

~~~
m_mueller
In Switzerland I see them relatively often. Their current overall market share
here is 2.4%. For comparison, Ford has 5.4%, Toyota 4.7%. Maybe the variety
here is a bit unique, even the largest brand Volkswagen only has 11.5%.

Having tried many different brands thanks to carsharing (also very popular
here), I have to say that one thing is a bit strange in Hondas - the controls,
as in switches, are a bit different from what most Europeans are used to. At
least for me it took the longest to get used to it compared to many other
brands. It seems they are less adapted from the Japanese base models, which
would speak against the article - maybe Honda did a better job in other
markets than EU.

~~~
bane
> I have to say that one thing is a bit strange in Hondas - the controls, as
> in switches, are a bit different from what most Europeans are used to.

I had use of a couple of Audis years ago and could _never_ get used to the
controls. It seemed like everything was designed to be in a place I'd either
want to rest an arm (and therefore accidentally trigger) or force me to take
my eyes off the road and change my body position to operate. One of them, the
A3, was particularly terrible, burying the radio controls almost down as low
on the dash as you could put it for example.

I remember one experience in particular, I was on the A9 from Nuremberg going
towards Munich. The car was still pretty new to me, but I'd been driving it
pretty steadily for a few weeks. I was listening to the radio, the show
changed and all I wanted to do was scan the dial for the next station. I had
to lean over with my head virtually below the dash to reach the dial, and it
being an Audi there were dozens of buttons and dials. I accidentally hit one
of the preset buttons instead of "scan forward" and it switched to an Opera
(which I don't particularly care for). I couldn't figure out, while driving
how to fix this, accidentally turned the volume up instead of down and ended
up with red Audi dash lights blaring me in the face while doing 170kph
absolutely blasting Opera music out of the car. Being Germany of course there
weren't big American style shoulders for me to pull over on and fix the
situation so I had to exit and drive till I found a place to park for 10
minutes to fix this mess.

The entire time I was doing this I was thinking of the Hondas, Nissans and
Toyotas I had driven right before that, where that entire operation was a
glance and a comfortable no-lean reach to the ergonomically placed controls
that were _just_ at arms reach away. The Audis were fun cars to drive, but
knowing that doing something like changing the radio station might put my life
at risk, I decided never to buy one.

So yeah the switches are definitely in different places, but I think that
they're in better places overall.

~~~
m_mueller
I think luxury cars tend to have worse controls, probably because they need to
cover many more features, so they aren't very representative. If you want
typical European controls, have a look at a run-off-the-mill Volkswagen,
Renault, Opel or Ford with stick shift. Yes, American brands tend to be very
well adapted to the market.

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chiph
This really reads like a PR plant. Honda (the company) is no longer like what
it was under Soichiro Honda. The bad reception of the 2012 Civic¹ was somewhat
of a wakeup call for them, but they have been late to market with gasoline
direct injection (GDI) motors, and there aren't any American-spec diesels in
development (the Pilot, Odyssey, and possible refresh of the Ridgeline could
really use the torque).

Given the trend (a new chairman every 5-6 years), we should expect to see new
leadership at Honda soon, and perhaps he will speed up product development,
and return more of the decision making to the engineers.

Surprising rumors are that they have licensed the ZF 9-speed transmission,
which will really help with the fuel economy. And give the Pilot gearing that
will help it off-road (the 9-speed often starts off in a higher gear, leaving
1st and/or 2nd for a simulated "low range"). I was expecting them to go with
one of the Aisin models, actually.

This is a big cultural change for Honda, as they have traditionally designed
and built their own transmissions. Given the stupendous cost of creating a new
automatic transmission (well over a billion dollars), this will free up a lot
of capital for them.

¹
[http://en.wikipedia.org/wiki/Honda_Civic_(ninth_generation)#...](http://en.wikipedia.org/wiki/Honda_Civic_\(ninth_generation\)#2012)

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hhandoko
The Japanese automotive industry is always a topic of interesting discussion
back in my university days [1]. One thing that's permanently ingrained in my
head about Honda since all these years: Know your core competencies. In
regards with Honda, it's making good engines.

[1] - I went to business school, not computer science.

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itazula
The book, Driving Honda, is a great read. If being a successful start-up means
making the best use of the resources around you, and being acutely aware of
the status quo, yet willing to challenge it through real engineering, then
Shoichiro Honda exemplified that way of being. And as a foil to the
destruction of a company's culture, there was none better than Takeo Fujisawa
(read the book to know why).

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dang
Url changed from [http://www.overcomingbias.com/2014/08/automation-vs-
innovati...](http://www.overcomingbias.com/2014/08/automation-vs-
innovation.html), which points to this.

