INTRODUCTION

Honda Motor Company

Honda Motor Company manufactures automobiles and motorcycles, trucks,

scooters, robots, jets and jet engines, ATV, water craft, electrical generators, marine
engines, lawn and garden equipment, and aeronautical and other mobile
technologies. Honda's line of luxury cars are branded "Acura" in North America
and China. More recently Honda has ventured into mountain bikes.

Honda is a world leader in producing motorcycles, but the majority of its annual
sales comes from automobiles, which the company began manufacturing in 1963.
Honda is known for its lightweight, fuel-efficient passenger cars, including the Civic
and Accord models. Honda is the fifth largest automobile manufacturer in the world
and the largest engine-maker, producing more than 14 million internal combustion
engines each year. Currently, Honda is the second largest manufacturer in Japan,
behind Toyota and ahead of Nissan 

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Honda is headquartered in Tokyo, Japan. Its stock trades on the Tokyo Stock
Exchange and the New York Stock Exchange, as well as exchanges in Osaka,
Nagoya, Sapporo, Kyoto, Fukuoka, London, Paris and Geneva, Switzerland.
American Honda Motor Co. is based in Torrance, California. Honda Canada Inc. is
headquartered in Markham, Ontario, since 2008. Hero Honda, a joint venture
between India's Hero Group and Honda, is the largest manufacturer of two
wheelers in the world.

HISTORY

Throughout his life, Honda's founder, Soic.hiro Honda, had an interest in

automobiles. He worked as a mechanic at the Art Shokai garage, where he tuned cars
and entered them in races. In 1937, with financing from his acquaintance Kato
Shichirō, Honda founded Tōkai Seiki (Eastern Sea Precision Machine Company) to
make piston rings working out of the Art Shokai garage. After initial failures, Tōkai
Seiki won a contract to supply piston rings to Toyota, but lost the contract due to the
poor quality of their products. After attending engineering school without graduating,
and visiting factories around Japan to better understand Toyota's quality control
processes known as "Five whys", by 1941 Honda was able to mass-produce piston
rings acceptable to Toyota, using an automated process that could employ even
unskilled wartime laborers.

Tōkai Seiki was placed under the control of the Ministry of Commerce and Industry
(called the Ministry of Munitions after 1943) at the start of World War II, and
Soichiro Honda was demoted from president to senior managing director after
Toyota took a 40% stake in the company. Honda also aided the war effort by
assisting other companies in automating the production of military aircraft propellers.
The relationships Honda cultivated with personnel at Toyota, Nakajima Aircraft
Company and the Imperial Japanese Navy would be instrumental in the postwar
period.[13] A US B-29 bomber attack destroyed Tōkai Seiki's Yamashita plant in
1944, and the Itawa plant collapsed on 13 January 1945 Mikawa earthquake.
Soichiro Honda sold the salvageable remains of the company to Toyota after the war
for ¥450,000 and used the proceeds to found the Honda Technical Research Institute
in October 1946.

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With a staff of 12 men working in a 16 m2 (170 sq ft) shack, they built and sold
improvised motorized bicycles, using a supply of 500 two-stroke 50 cc Tohatsu war
surplus radio generator engines. When the engines ran out, Honda began building
their own copy of the Tohatsu engine, and supplying these to customers to attach to
their bicycles.This was the Honda A-Type, nicknamed the Bata Bata for the sound
the engine made. In 1949, the Honda Technical Research Institute was liquidated for
¥1,000,000, or about US$5,000 today; these funds were used to incorporate Honda
Motor Co., Ltd.  At about the same time Honda hired engineer Kihachiro
Kawashima, and Takeo Fujisawa who provided indispensable business and
marketing expertise to complement Soichiro Honda's technical bent. The close
partnership between Soichiro Honda and Fujisawa lasted until they stepped down
together in October 1973.

The first complete motorcycle with both the frame and engine made by Honda was
the 1949 D-Type, the first Honda to go by the name Dream. In 1961, Honda
achieved its first Grand Prix victories and World Championships in the 125cc and
250cc categories. Honda Motor Company grew in a short time to become the world's
largest manufacturer of motorcycles by 1964.The first production automobile from
Honda was the T360 mini pick-up truck, which went on sale in August
1963.Powered by a small 356cc straight-4 gasoline engine, it was classified under the
cheaper Kei car tax bracket.The second production car from Honda was the S500
sports car, which followed the T360 into production in October 1963. Its chain-
driven rear wheels pointed to Honda's motorcycle origins.

Over the next few decades, Honda worked to expand its product line, operations and
exports to numerous countries around the world. In 1986, Honda introduced the
successful Acura brand to the American market in an attempt to gain ground in the
luxury vehicle market. The year 1991 saw the introduction of the Honda NSX
supercar, the first all-aluminum monocoque vehicle that incorporated a mid-engine
V6 with variable-valve timing.

In 1990, CEO Tadashi Kume was succeeded by Nobuhiko Kawamoto. Kawamoto

was selected over Shoichiro Irimajiri, who oversaw the successful establishment of
Honda of America Manufacturing, Inc. in Marysville, Ohio. Irimajiri and Kawamoto

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shared a friendly rivalry within Honda; owing to health issues, Irimajiri would resign
in 1992.

Following the death of Soichiro Honda and the departure of Irimajiri, Honda found
itself quickly being outpaced in product development by other Japanese automakers
and was caught off-guard by the truck and sport utility vehicle boom of the 1990s, all
which took a toll on the profitability of the company. Japanese media reported in
1992 and 1993 that Honda was at serious risk of an unwanted and hostile takeover by
Mitsubishi Motors, which at the time was a larger automaker by volume and was
flush with profits from its successful Pajero and Diamante models.

Kawamoto acted quickly to change Honda's corporate culture, rushing through

market-driven product development that resulted in recreational vehicles such as the
first-generation Odyssey and the CR-V, and a refocusing away from some of the
numerous sedans and coupes that were popular with the company's engineers but not
with the buying public. The most shocking change to Honda came when Kawamoto
ended the company's successful participation in Formula One after the 1992 season,
citing costs in light of the takeover threat from Mitsubishi as well as the desire to
create a more environmentally friendly company image.

The Honda Aircraft Company as established in 2006 as a wholly owned subsidiary to

manufacture and sell the HondaJet family of aircraft. The first deliveries to
customers began in December 2015.

On February 23rd, 2015, Honda announced that CEO and President Takanobu Ito
would step down and be replaced by Takahiro Hachigo in June of that year;
additional retirements by senior managers and directors were expected.

In October 2019, Honda was reported to be in talks with Hitachi to merge the two
companies' car parts businesses, creating a components supplier with almost $17
billion in annual sales.

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In January 2020, Honda announced that it would be withdrawing employees working
in the city of Wuhan, Hubei, China due to the COVID-19 pandemic.[31] On March
23, 2020 due to the global spread of the virus, Honda became the first major
automaker with operations in the US to suspend production in its factories. It
resumed automobile, engine and transmission production at its US plants on May 11,
2020.[32]

Honda and General Motors announced in September 2020 a North American alliance
to begin in 2021.[33] According to The Detroit Free Press, "The proposed alliance
will include sharing a range of vehicles, to be sold under each company’s distinct
brands, as well as cooperation in purchasing, research and development, and
connected services."[34]

In March 2022, Honda announced it would develop and build electric vehicles in a
joint venture with Sony. The latter is set to provide its imaging, sensing, network and
other technologies while Honda would be responsible for the car manufacturing
processes. The venture is set to fully launch later in 2022 with the release of first cars
scheduled for 2025.

Company Background

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Name Honda Motor Company, Ltd.

Founded September 24, 1948

Logo

Industries Automotive, Aviation, Robotics, Finance

served

Geographic Worldwide (more than 100 countries)

areas served

Headquarters Minato-ku, Tokyo, Japan

Current CEO Toshihiro Mibe

Revenue $127.74 billion (2021)

Profit $5.5 billion (2021)

Employees 211,374 (2021)

Main Bayerische Motoren Werke AG, Chrysler Group LLC, Daimler AG, Ford
Competitors Motor Company, General Motors Company, Nissan Motor Company,
Hyundai Motor Company, Tata Motors, Ltd., Toyota Motor Corporation,

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 Volkswagen AG and many other automotive companies.

Honda Motor Company (further Honda or Company) is a Japanese motorcycle,

automobile, aircraft and engine manufacture. The Company was founded in 1948 by
Soichiro Honda, as an automotive parts manufacturer. Honda later moved to
manufacturing motorcycles and has become the world’s largest motorcycles
manufacturer in 1959.

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Honda Mission, Vision & Value

Honda Mission Statement

“A dynamic growth oriented company through market leadership, excellence in
quality and service and maximizing export, ensuring attractive returns to equity
holders, rewarding associates according to their ability and performance, fostering a
network of engineers and researchers ensuing unique contribution to the
development of the industry, customer satisfaction and protection of the environment
by producing emission friendly green products as a good corporate citizen fulfilling
its social responsibilities in all respects.”

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Honda Vision Statement
Serve people worldwide with the joy of expanding their life s potential - Lead the
advancement of mobility and enable people everywhere in the world to improve their
daily lives –

Honda Values
 The Honda Philosophy

 Total Quality Management

 New Honda Circle

 Initiative

 Equality

 Trust

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 SWOT

Strengths Weaknesses

1. Competence in engine manufacturing – company’s 1. Dependence on North

core product America to generate most of
the revenue
2.Diversified product portfolio
2. Low investments in research
3. Dominance in motorcycle and engine industries and development (R&D) leading
leading to a high brand awareness to innovative products

4. Strong position in Asia’s motorcycle markets

Opportunities Threats

1. Increasing government regulations 1. Increased competition

2. Improving U.S. economy 2. Rising Japanese Yen exchange
3. Timing and frequency of new model releases rates
4. Low fuel prices are increasing the demand for 3. Natural disasters
pickup trucks and SUVs

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Strengths

1. Competence in engine manufacturing – company’s core

product
All Honda’s businesses are built around the engines – its core product. The
company’s first engines were built for motorcycles and power equipment, but were
later produced for cars and marine vehicles. Honda is the world’s largest engine
manufacturer, which produced over 27 million units of engines for automotive,
motorcycle, marine, and power equipment products, in 2015.[3]

The company has lots of experience in manufacturing quality and well-performing

engines. Its engines are praised for their durability, easiness to start, quietness, fuel
efficiency and reliability. According to Reliability Index,[4] Honda’s car engines are
some the most reliable in the industry.

Engines are the key to motor products and the company’s competence in
manufacturing engines is a competitive advantage few rivals can match.

2. Diversified product portfolio

honda operates 4 different divisions:

 Motorcycle business (12.3% revenue)

 Automobile business (72.8% revenue)
 Power product and other business (2.3% revenue)

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  Financial Services (12.6% revenue)
Honda offers many products to consumers including engines, cars, motorcycles, jets,
robots, generators, lawnmowers, water pumps, as well as many other power
equipment products. While the cars generate the most revenue for Honda, its overall
product portfolio is fairly diversified, when compared to Volkswagen, Toyota,
General Motors, or Briggs and Stratton (in an engine industry).

3. Dominance in motorcycle and engine industries leading

to a high brand awareness
Honda is a huge company dominating in most of the markets it operates in, including
engines and motorcycles.

The company is the leading manufacturer of small, general purpose engines for
commercial, rental industry, and consumer applications. [5] Honda is also the leading
global manufacturer of motorcycles having 22.1% of the total market share in the
first half of 2016] Company’s dominance in both of these markets have increased its
brand recognition and reputation.

According to Interbrand[6] and Forbes,[7] Honda is the 21st and 23rd most valuable

brand in the world, worth US$22.1 billion and US$25.2 billion, respectively. Brand
value is closely related to brand awareness and its reputation and only few other
companies, such as Toyota, BMW and Mercedes-Benz, can compare with Honda in
terms of a brand value.

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4. Strong position in Asia’s motorcycle markets
Motorcycle business generates 12.3% of total Honda’s sales and is the third largest
revenue group for the company. The company has sold 17,592 units of motorcycles
and all-terrain vehicles in 2016 alone and captured 22.1% of the world’s motorcycle
market in the first half of 2016.

Asia is the main geographic segment for Honda’s motorcycle business, where the
company has sold 15.1 million units or over 88.7% of its total motorcycles,
generating ¥1,107.6 billion in revenue.

Asia-Pacific region, which includes such countries as China, India, Vietnam,

Thailand, the Philippines, Malaysia, Indonesia, Australia and Japan, is the largest
motorcycle region in the world and Honda’s strong position in it is a powerful
competitive advantage.

Weaknesses

1. Dependence on North America to generate most of the

revenue
Honda depends on North America region, which mainly includes the U.S. and
Canada, to generate 55.6% of the company’s total revenu

Honda’s reliance on North America grew from 49.3% of the total sales in 2014 to
55.6% of the total sales in 2016. At the moment, North America is the main driver
behind company’s growth where the motorcycle revenue grew 20% and the
automobile revenue grew by 19%. Nonetheless, the U.S. and Canada are saturated
markets and Honda will find it hard to maintain the same level of growth in these
markets.

The company is also becoming more vulnerable to overall negative changes in North
America’s markets.

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2. Low investments in research and development (R&D)
leading to fewer innovative products
Honda has spent US$5.4 billion for R&D in 2015. This amounted to 4.5% of the
company’s total revenue.

Figure 3. Comparison of R&D expenditure – Honda and selected major competitors

(in US$ billions)

2015 As a % of As a % of
Company 2014 R&D
R&D revenues revenues

Honda 5.4 4.5 5 4.5

Toyota 8.4 3.7 7.6 3.5

Volkswagen 14 6.9 14 7.1

General 7.5 4.9 7.4 4.7

Motors

Source: The respective companies’ financial reports

Low investments in R&D lead to fewer innovative products and significantly

undermine the company’s abilities to compete in the future. The company should
focus its US$5.4 billion R&D investments to certain areas (like Hyundai does),
which would erase company’s low R&D budget disadvantage and would result in
innovative products

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Opportunities
1. Increasing government regulations
Many governments around the world are committed to reducing the greenhouse gas
emissions and are encouraging fuel efficiency initiatives. Such environmental
initiatives may increase production costs for the car manufacturers and these costs
will be either passed to price sensitive consumers or will decrease the company’s
profits. Honda may take advantage of this by introducing more car models running
only Hydrogen fuel cells and bypassing all the government regulations associated
with the greenhouse gas emissions.

2. Improving U.S. economy

Signs of an improving economy and rising consumer confidence have been reflected
in the strongest increase in new vehicle sales for more than a decade in the U.S.
market. 17.5 million new units were sold in 2015, a 5.7% increase over 2014. Interest
rates in the U.S. have been low for several years and are forecast to remain that way
for the foreseeable future. In such economic conditions, Honda has an opportunity to
capture higher market share and increase sales in the U.S. automotive market.

3. Timing and frequency of new model releases

The market share of the automotive companies is significantly impacted by the
timing and frequency of new model releases. Historically, new models have tended
to have major upgrades every 4 or 5 years with only minor modifications in between.
However, due to the rising consumer expectations in relation to in-car technology
and the competitive nature of the industry, there is an argument to release upgraded
models more frequently. Honda is well-positioned to be able to do this.

4. Low fuel prices are increasing the demand for pickup

trucks and SUVs
Currently, fuel prices are the lowest in a decade. Such situation has encouraged
consumers to buy big fuel-inefficient vehicles such as SUVs and pickup trucks.

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Traditionally, Honda’s main focus was on smaller cars like Honda Civic and sedans
such as Honda Accord, but in the current situation, where fuel prices are low, the
company has introduced its next generation pickup truck Ridgeline and redesigned
its CR-V sport utility vehicle to meet the demand for the bigger vehicles.

The trend of low fuel prices is likely to stay and Honda should introduce more
models of pickup trucks and SUVs to take an advantage of the growing market for
these vehicles and to increase company’s profitability.

Threats

1. Increased competition
Honda is faced with an ever increased competition from the traditional automotive
companies, the new players and saturation of its main markets. In Asia, the
company’s key motorcycle region, markets are nearly saturated. In 2016, Honda’s
motorcycle revenue grew by only 5.4% in Asia, compared to 20.3% growth in North
America region. The company faces many new entrants in India and China, which
offer similar quality motorcycles and scooters for lower price than Honda.

Honda’s automotive business is also experiencing the slowing growth of the

automotive markets and the increased competition from the new Chinese
manufacturers. The company’s international rivals, such as Toyota, Ford, General
Motors, Volkswagen and Hyundai, all have larger budgets and could use them to
aggressively take market share from Honda.

MARKETING MIX

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Product Strategy

Generally, the product portfolio of Honda is comprehensive. But particularly, only a

few of its products are best-selling. It has 4 business segments: power, motorcycles,
cars, and financial services. The company manufactures every type of car from
trucks to mini cars, family cars, hybrid, electric, trucks, and everything in between.
There are numerous models that have gained international fame such as Accord
Tourer, Civic, Brio Amaze, and many more. It has a diverse range of truck models
for different purposes. The company has built cars that run on gasoline, alternate fuel
like fuel cell engines, ethanol, and natural gas.

With these offerings, Honda covers the entire segment of the automobile market. Its
cars are enough to fulfill the requirements and needs of every customer. In Asia,
Honda has a famous name due to its reliable motorcycles. Most of its motorcycles
consist of an internal combustion engine, an indigenous product of Honda. Honda
also manufactures MUVs, ATVs, and SUVs. Its financial services for the customers
are really commendable. In short, Honda is a leader in technology as it has
manufactured advanced robots that can navigate, walk, and dance.

Pricing Strategy of Honda | Marketing Strategy of Honda

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 Honda is a successful automotive brand in the world because its cars target every
sector of the market. The company has luxury sedans, SUVs, sedans, and hatchbacks.
The pricing factor of these cars depends on various things like features, sector,
competition, etc. The main target customers of Honda are low middle-class people to
high-class people. Honda sets the price of its products with the help of dealers.
Pricing strategy also involves some essential factors like taxes, currency rate, and
other countries in which Honda sells its products. Honda motorcycles cover a large
segment of people in Asian countries like Pakistan, India, Malaysia, and more. Apart
from motorcycles, Honda also manufactures sports bikes and luxury bikes. Currently,
Honda has manufacturing units in major countries of the world

Place and Distribution Strategy of Honda | Marketing

Strategy of Honda

The sales network of Honda is really robust. In 2006, the company had 3 sales
channels: Honda Primo, Honda Verno, and Honda Clio. Honda Verno covered sporty
products. Honda Clio vended traditional products of Honda and Honda Primo vended
small cars. In 2006, Honda established the Honda Cars dealerships after finishing the
Clio, Primo, and Verno. The company also sells different automobile accessories
through Honda Access. These things show that the company has a strong marketing
strategy of honda, sales, and distribution network. Honda has more than 300
authorized dealerships in more than 190 cities when it comes to India. Here is the
number of authorized retail dealers of Honda in different countries:

 Japan – 700 retail dealers

 US – 1300 retail dealers
 Asia – 1500 retail dealers
 Europe – 1100 retail dealers
On the other hand, the company sells motorcycles through independent dealers in
Asia, Europe, and the USA. These statistics are enough to show you Honda’s robust
sales and distribution network.

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Advertising Strategy of Honda | Marketing Strategy of
Honda
The marketing strategy of honda or advertising strategy is really innovative and
captivating. Moreover, they have used various slogans and taglines in the past to
attract customers. As of now, Honda’s advertising strategy is incredibly good and
they easily connect with people through their ads. In 1963, Honda sold more than 90
thousand bikes due to its effective promotional strategy. Moreover, they release
different themes with ads to attain the interest of customers. Thus, the brand has a
strong presence on Facebook and Instagram on social media. Its ads show innovation
and technology used in its products. They also portray that its cars are reliable for
users and this thing is really engaging.

Many celebrities and famous personalities are the brand ambassadors of Honda.
Moreover, Honda sponsors different sports events like FIA Formula 1, hockey, and
golf. In short, Honda is generating a significant profit by selling its products through
effective advertising.

New companies, such as Tesla and even Google, which tries to build self-driving
cars are also threatening the traditional automotive industry. The competition is
further fueled by the fact that the global automotive production capacity far exceeds
the demand. In 2015, there was an estimated global excess production capacity of 31
million units.

2. Rising Japanese Yen exchange rates

More than 88% of Honda’s revenue come from international markets, which means
that the company has to convert foreign currencies to Japanese Yen in order to
calculate its revenues and send the profits back to Japan. Currency rates are volatile
and the company’s profits and revenue highly depend on the fluctuating exchange
rates. The company cannot control the currency exchange rates, therefore it is at risk,
if Japanese Yen exchange rates would start to rise. In such case, the company’s
profits would decrease significantly. The company itself identifies this as a key threat
that will negatively affect the company over the next few years.

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3. Natural disasters
Honda has manufacturing facilities in Japan, Thailand, China and Indonesia. These
countries, including others, are often subject to natural disasters that disrupt
manufacturing processes and result in lower production volumes and profits.

Success story: Honda

Honda’s early life and struggles

Soichiro Honda was born in a small village in Japan to a blacksmith and a weaver.
Since childhood, he was a curious individual. Honda was always interested in
machines, tools and how vehicles work. He was not interested in school and always
aimed to learn things practically. As he grew up, he worked in his father’s bicycle

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shop, which enriched his capabilities. Japan’s sudden shift from agriculture to
manufacturing pushed him further.

At age 16, Honda left his small Japanese hometown and moved to Tokyo. At that
time, he wanted to work for the most prominent vehicle company – Toyota. Honda
had developed a revolutionary engine piston ring, and it was his dream to work at
Toyota. He worked tirelessly in his small workshop to make his dream come true.
Once he completed the piston ring, he took it to Toyota. But, Unfortunately, the
company rejected him as it did not meet their standards of engineering. He did not
lose hope and enrolled in a technical school.

After working on the piston ring for almost two years, he finally came up with a
design that would match Toyota’s quality. He bagged a contract but needed a factory
to manufacture the rings. Since Japan was getting ready for war against the United
States, Honda could not source the materials required to build the factory. Somehow
he managed to construct a factory, but it was bombed twice during the war. A
majority of people would have given up by this time but not Honda. He was resilient
and found another way to make it work. Finally, his luck turned and, he rebuilt his
factory. But in the year 1945, a massive earthquake hit Japan that destroyed Honda’s
manufacturing plants. He was now entirely out of business and sold his
manufacturing processes to Toyota.

Honda’s step to success

After the war, a massive fuel shortage hit Japan, making transportation around the
country inaccessible. Due to his love for his country, Honda came up with an idea.
He put a small motor in his bicycle and, his new invention attracted people from all
around the city. People flooded him with requests, and Honda was back in business.
However, Honda needed capital for the construction of the scooters. So he handwrote
18000 personal letters to bicycle shop owners asking for their support to invest in his
new invention. Almost 3000 owners replied and, he got more than enough money to
fund his new venture. Within a decade, Americans had embraced the idea of Honda
motorcycles and, Soichiro’s motorcycles were winning international motorcycle
races.

Today, Honda Motor Company manufactures motorcycles, cars and even marine and
aerospace parts and equipment. Honda is now one of the leading automotive
manufacturers, and the company’s motorcycles are still winning races around the
world.

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Lessons we can learn from Honda’s story
Soichiro Honda said, “Success can only be achieved through repeated failure and
introspection.” His journey was long and filled with hurdles and challenges. Honda
almost gave up many times, but he stood up to continue what he loved doing. Failure
did not prevent him from pursuing his dream and urged him to find a way to succeed.
We should always learn from our failures and aim to do better the next time.

Customers
Honda's approach to customer satisfaction

In accordance with the Honda philosophy of respect for the individual and the Three
Joys of buying, selling, and creating, Honda has always worked closely with its
dealerships to maximize customer satisfaction. Every step of the way, from purchase
to after-sales service, dealerships work together with Honda to earn and maintain the
trust of customers.

Systems and objectives designed to enhance worldwide

customer satisfaction

In order to "Provide good products to our customers with speed, affordability and
low CO2 emissions." as stated in Honda's 2020 vision, the Customer Service
Operations is striving to realize optimal service operations in markets worldwide to
pursue the priority goal of creating and expanding customer joy worldwide through
service. In order to achieve this, we set our goals to be the undisputed No. 1 in
customer satisfaction. "Undisputed no. 1 in customer satisfaction" refers to the
creation of customer joy and excitement by providing a level of value that not only
satisfies the expectations that customers have when they receive services based on
their past experiences and information, but also exceeds them. The experience of

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excitement through these services forges an emotional connection between customers
and Honda, ensuring that the company remains a mobility manufacturer that
customers choose based on their high expectations. To attain this goal, services and
parts divisions have adopted an activity policy of offering service in a friendly,
timely, reliable, affordable, and convenient manner; developing an advanced service
environment; and maximizing business efficiency and expanding business
operations. They are also focused on creating an environment allowing regional
dealers—Honda's point of contact with customers—to address customer satisfaction
enhancement more effectively and efficiently.

Enhancing customer satisfaction

Conducting customer satisfaction surveys Aiming to establish lifelong relationships

with satisfied customers, Honda takes a proactive approach to conducting customer
satisfaction surveys in all product segments: motorcycles, automobiles, and power
products. Carefully analyzed survey results are fed back to the departments involved
and dealerships in the form of practical suggestions for improvement and put to use
in day-to-day activities. In Honda's overseas automobile operations, for example,
survey results are used to compile a Customer Satisfaction Index (CSI) for each
product and region. In Japan, an initial questionnaire is distributed to purchasers of
new automobiles, and, since FY2004, a questionnaire has also been distributed to
purchasers of pre-owned automobiles. In FY2008, a survey was introduced to query
customers whose automobiles will soon be due for the periodic automobile
inspection required by the Japanese government. Earning a No. 1 rank in customer
satisfaction surveys around the world In its overseas automobile business, Honda's
activities focus on the "3Ps" in order to meet diverse customer expectations. These
initiatives involve increasing the quality of service provided to customers by looking
at things from the customer's point of view and identifying and resolving local issues
in each of the three points of contact between Honda and its customers:
"Premises/Process," "People," and "Product

Customer Relations Center

The Customer Relations Center has a very straightforward slogan: "For the
customer." Its mission is to handle inquiries from Honda customers politely, clearly,

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and quickly, delivering the same high quality in Honda communications as is found
in Honda products. The Center also responds to survey requests from the Japanese
government and inquiries from consumer advocacy organizations. The Center
receives feedback in the form of customer questions, suggestions, requests and
complaints 365 days a year, and during FY2014 it processed 258,196 inquiries. To
ensure that this valuable information is put to good use in Honda's operations, the
facility shares it in a timely manner with the company's R&D, manufacturing,
service, and sales departments in compliance with laws and regulations as well as
Honda's own policies concerning the handling of personal information

Implementing customer satisfaction

Motorcycle initiatives Establishing service frameworks for dealers in emerging

nations

Honda has, with minimum investment and facilities, been quick to set up plants and
start business in emerging markets (such as in Africa and Southwest Asia) dominated
by Indian and Chinese manufacturers. A lack of social infrastructure and education
meant that general motorcycle dealers in these markets were unable to provide the
level of service that Honda was looking for. As a latecomer to such markets, Honda
works constantly to highlight points of differentiation with competitors, and
consequently increase its share of sales, by delivering to customers and subsidiaries
the Three Joys (the Joys of Buying, Selling and Creating), as stated in the
Fundamental Beliefs. In particular, we believe it is our mission, using the limited
management resources available, to manufacture and sell competitive, high-quality
Honda products and to build frameworks for providing satisfaction to the customer
through after-sales service. Specific initiatives include developing a ‘maintenance
invoice’ for use in emerging nations where educational levels are low. These have
been provided to dealers along with guidance on how to apply them. Invoices come

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with simple illustrations and diagrams have been included on the invoices to explain,
in a format anyone can understand, procedures for visual and operational
confirmation of vehicles on delivery after purchase, and procedures taken when the
customer brings in a vehicle for maintenance or repair. Easier to grasp and serving as
an aid for ensuring sound aftersales service delivery, the result is satisfaction for both
customer and dealer personnel. Furthermore, the exchange of maintenance invoices,
containing details of customer complaints and repair work and other valuable
information, puts in place a process at overseas subsidiaries for properly gathering
data on market quality for feedback to manufacturing and product development
divisions even in circumstances where it is not possible to invest sufficiently in
information infrastructure.

Automobile initiatives

Japan: Ensuring motorists can drive Honda vehicles safely

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Highly skilled service personnel with extensive knowledge of Honda vehicles
provide high-quality after-sales service at Honda Cars and Honda Auto Terrace,
Honda’s automobile dealerships: they make use of proprietary tools developed by
Honda, electronic diagnostic devices, and other systems along with extensive vehicle
quality information gathered from dealerships across Japan. As of March 2014, about
1.8 million customers had taken advantage of bundled services including regular
inspections and oil changes, and more than half of all new vehicle purchases
included Honda’s extended warranty, helping the company achieve a high level of
customer satisfaction. Dealers work hard to ensure that customers can enjoy their
Honda vehicles with confidence and peace of mind under the best possible
conditions by offering a wide range of services to provide a pleasant ownership
experience, including by enhancing Honda's menu of car maintenance services, a
reasonably priced selection of ways to refresh vehicles inside and out.

Japan: Customer support via the Honda C-card

Honda offers the Honda C-card to provide an optimal level of service to customers at
all times. As of March 2014, the card, which combines a point-based cash rewards
program, preferred service for members, a charitable donation program, and other
benefits with basic credit card functionality, had been issued to a total of some 2.89
million members since the start of service in October 1995. Additional "Honda C-
card Members" services were added in October 2006, including the ability to
reference a vehicle's maintenance history and the ability for cardholders to notify
Honda of their address changes 24 hours a day. We've also added a Honda C-card
without credit card functionality as an additional choice for customers.

Donating funds based on Honda C-card usage

Each year since its introduction in 1995, Honda has donated a fixed percentage of
customers' Honda C-card usage to the Japanese Red Cross Society and the Japan
Committee for UNICEF. In 2014, these

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Increasing service staff members' technical skills

A unique service education system

Honda offers a range of training for dealer service staff through the Honda
Automotive Service Education System. The program is based on Honda Automotive
Service Training System (HAST), which incorporates not only technical but also
customer service content in order to foster the simultaneous development of both
technical and customer service skills. The program, which includes training in
specialized subjects as well as training for full-time workers, meets the needs of a
broad range of field staff. Honda also offers the Body Paint (BP) Training Program
for body repair and painting staff in order to foster the development of specialists in
those areas. Recently, we have been working to enhance the technical skills of
service staff by increasing the percentage of these workers who hold Service
Engineer certifications*1 and expanding a trainer program*2 designed to bring
HAST training to the prefectural and corporate levels. *1 Trainer program: A
program that builds on HAST training in order to offer trainer education to
exceptional staff at the prefectural and corporate levels. *2 Service engineer
certification: A series of service engineer certifications (grades 1 through 3)
reflecting level of training have been established under the HAST Program and the
BP Training Program.

Giving service personnel a chance to hone their skills at the

Honda Automobile Service Skill Competition

Honda holds the Honda Automobile Service Skill Competition to provide an

opportunity for service personnel from across Japan to put their service skills,
knowledge, and hospitality to the test at a venue designed to stimulate participants to
hone their skills while fostering the development of the next generation of service
professionals. The competition consists of three events: the Service Engineer Course,
where individuals compete to gauge the precision with which they can diagnose

27
malfunctions and replace parts; the Corporate Team Course, where teams of three
compete in a simulated customer service from reception to delivery as well as
malfunction diagnosis; and the Reception Staff Course, where participants compete
in a role-playing format that tests their ability to serve customers as reception staff. A
maintenance contest where participants compete to see who can disassemble,
measure, and assemble functional parts with the greatest speed and precision is held
at the same time. Through the Service Skill Competition, Honda is striving to train
its service personnel to a higher level. Through their participation in an event that
allows them to exhibit the skills they have developed through their daily work,
service personnel both increase their awareness of the importance of building skills
and help improve service quality at Honda.

Overseas: Products that bind customers to Honda

Honda strives to deliver an optimal level of service to customers worldwide based on

its philosophy of creating and expanding customer joy worldwide through service.
The company shares advanced service activities and approaches from different
countries with personnel worldwide through Customer Service Operations in Japan
as it works to expand its program of initiatives in ways designed to complement each
country’s market characteristics. To provide a pleasant ownership experience for
customers, Honda dealers offer a range of regular inspection packages with various
payment and service options as well as extended warranties designed to ensure
customers are able to enjoy their products over the long term. These products
continue to evolve on a daily basis in each market in response to customer needs,
which are diversifying worldwide. As of January 2014, they were being offered by
dealers in more than 30 countries. Going forward, we will strive to expand customer
joy to include all countries as we create strong bonds linking customers and Honda in
markets worldwide by bringing these activities to emerging markets.

Power product initiatives

Enhancing the way we provide service information to

customers and dealerships: Consumer products edition

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In emerging nations, where demand is growing rapidly, products are carried by
businesses other than Honda dealers, making it necessary to provide appropriate
service information to general retailers. Even as we've been building a service
network linking Honda stores, we've also enabled the direct distribution of the
minimum amount of service information needed by general retailers and customers
via the Internet. Specifically, we improved our engine information website to add
consumer products information. We also asked for local feedback about the types
and categories of service information that should be provided, and we selected,
compiled, and otherwise prepared information based on that input. As a result, we
began offering service information for generators and outboard engines in addition to
engine information in fall 2010. As of March 2014, this information was available in
43 countries, and it was being accessed about 13,000 times each month. (From
access logs, we found that while the information was made available in 43 countries,
it was actually accessed by users in a total of 139 countries.) Additionally, the
website incorporates a mechanism for soliciting market feedback about needs related
to information dissemination, site content, and product serviceability. These
questionnaires make it easy for customers to submit requests and opinions to Honda.

Expanding an initiative to reduce complaints

Thanks to an initiative to address complains by soliciting customer feedback that was

launched in Japan in June 2006 and subsequently implemented in Europe and the
United States, the complaint rate (obtained by dividing the number of complaints per
month by the number of power products sold over the last year) has been falling.
About eight years of experience with this initiative has taught us that customer
complaints and requests concerning our products exhibit great variety as a result of
regional differences in culture, climate, and lifestyle, revealing significant
differences in how products are used. Recognizing the breadth of those differences,
we began developing similar systems in China and Thailand in April 2012 and in
India in October so that we could better gather customer feedback in those countries
as well. Specifically, a regular meeting to reduce customer complaints is held in each
country on a monthly basis. In addition to facilitating the sharing among relevant
departments of information about every piece of customer feedback received by
customer service hotlines concerning our business operations, including products as
well as sales and service activities, and the examination of improvement measures,
these meetings provide a venue for reviewing the progress and results of those
measures and ensuring that they are incorporated into a growing feedback database.
We also work to eliminate customers' complaints at the source by investigating the
root causes of complaints, identifying issues that need to be resolved, and

29
implementing measures as the departmental level to do so. Customer complaints that
go beyond the regional level and have the potential to impact the power products
business as a whole are identified and shared along with information about effective
countermeasures among facilities worldwide. Including a quick reference guide in
product packaging

Including a quick reference guide in product packaging

In order for customers to be able to use the products they purchase in their original
condition as long as possible, it is critical that they operate them properly and inspect
them regularly. Honda Siel Power Products in India packages a quick reference guide
with generators sold in emerging nations. Designed so that they will be available for
use whenever they are needed. These guides incorporate following characterics: 1.
Operating instructions on the front and a description of how to perform a regular
inspection on the back, 2. Illustration-based explanations, 3. All on a color-printed
A4-size sheet (designed so that it can be reproduced clearly as a black-and-white
copy), and 4. Uses paper that will not tear even if it gets wet.

Maintainace support iniciative

Initiative to streamline environmental responsiveness:

Introducing water-based paint at Asian dealers

Honda recognizes the need to minimize the environmental impact of industrial waste
such as the used tires and oil and scrap cars that are generated as part of its after-sales
business activities. Emissions of volatile organic compounds (VOCs) during painting
work are one such area since atmospheric emissions of compounds such as toluene

30
and xylene from paint act as photochemical oxidants to cause photochemical smog.
These compounds also cause acid rain, contributing to the destruction of forestland
and interfering with absorption of CO2 to accelerate global warming. Along with
Europe and South Korea, California and a number of other states in the U.S. have
prohibited the use of paint mixed with solvents or thinners, leading to broad use of
water-based paint. By contrast, use of solvent-based paint remains common in
Southeast Asia, which lacks legal regulations prohibiting their use, and very few
dealers have pursued use of water-based paint on their own due to the higher cost.
Honda Automobile (Thailand), a Honda automobile subsidiary in Thailand, took the
initiative in 2008, deciding to introduce water-based paint at automotive dealers in
the country. The Customer Service Education Branch's Body Repair and Painting
Team in Japan was asked to help prepare for the change, but the team lacked the
necessary expertise at the time since use of water-based paint was unusual in Japan
due to the lack of similar regulations there. At the same time, there has been a
tendency in the industry to avoid use of water-based paint due to its high cost. We
then conducted an exhaustive trial of water-based paint and upon reviewing their
properties found that water-based paint contains more pigment (i.e., it “covers”
better) than solvent-based paint that has been cut with thinner, with the result that
less paint is needed to complete a given job. The use of existing techniques to apply
water-based paint leads to the use of more paint than is needed, increasing costs. We
realized that it was overuse of paint that was fueling the view that water-based paint
is more expensive. Using the appropriate amount of paint not only saves on total
paint consumption, but also streamlines work by shortening the number of hours
needed to complete a given painting job, increasing the amount of work that can be
finished each day and boosting body repair revenue. As a result, dealers in Thailand
welcomed the introduction of water-based paint, and we were able to bring it to all of
the more than 100 body repair and painting shops in the country. Having
incorporated these techniques into training materials, introduction of water-based
paint in China is underway, while its introduction in Indonesia was completed in
2012. We have also started introducing it in Vietnam, while studies into doing the
same in the Philippines are underway. In Asia, where there are no regulations
prohibiting solvent-based paint, and China, where such regulations are comparatively
weak, Honda's environmental responsiveness in this area places is a step ahead of
other companies. We will continue this program of activities to ensure that those who
implement environmental measures come away happy, based on our global
environmental slogan, “Blue Skies for Our Children.

31
Do you use any Honda vehicle?

Classification No. of responses Percentage

Yes 81 81.3

No 17 17.7

other 1 1

Interpretation

From the above table it can be inferred that 81.3% of the respondent using Honda
vehicles,17.7% of respondent do not using Honda vehicle ,1% of respondent using other
vehicle.

It can be concluded that most of the people using Honda vehicle.

32
Which vehicle of Honda are you using?
Classification No. of responses Percentage

Car 19 19.6

Motorcycle 52 52.2

Other 28 28.3

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Interpretation

From the above table it can be inferred that 19.6% of the respondent using Honda car
vehicles, 52.2% of respondent using Honda motorcycle vehicle ,28.3% of respondent
using other vehicle.

It can be concluded that most of the people using Honda motorcycle vehicle.

Classification No.of responses Percentage

1-11 month 29 29.3

1-10 years 46 46.7

More than 10 years 23 23.9

How long have been using the vehicle?

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Interpretation

From the above table it can be inferred that 29.3% of the respondent have been using
Honda vehicle at least 1 to 11 months, 46.7% of respondent have been using Honda
vehicle at least 1 to 10 years, 23.9% of respondent have been using more than 10
years. It can be concluded that most of the people have been using at least 1 to 10
years.

How often do you visit for the maintenance of the

vehicle?

Classification No. of responses Percentage

Every week 7 7.5

Every month 26 26.9

Whenever it is 65 65.6
required

35
Interpretation

From the above table it can be inferred that 7.5% of the respondent do often visit for
the maintenance of the vehicle every week, 26.9% of the respondent visit every
month for the maintenance, 65.6% of respondent visit whenever it is required for the
maintenance. It can be concluded that most of the people visit for the maintenance of
the vehicle whenever it is required.

How much do you spend on the maintenance every

month?

Classification No. of responses percentage

Less then 2000 Rs 66 66.7

2000-5000 Rs 25 25.8

More than 5000 Rs 7 7.5

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Interpretation

From the above table it can be inferred that 66.7% of the respondent spend less than
2000 Rs. on the maintenance every month, 25.8% of the respondent spend 2000 to
5000 Rs., 7.5% of respondent spend more than 5000Rs.

It can be concluded that most of the people spend less than 2000 Rs. on the
maintenance every month

How is the fuel consumption of the Honda vehicle you

are using ?
Classification No. of responses Percentage

Good 52 52.2

Average 40 40.2

Bad 7 7.6

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.

Interpretation

From the above table it can be inferred that 52.2% of the respondent good fuel
consumption of the Honda vehicle, 40.2% of the respondent average fuel
consumption, 7.6% of the respondent bad fuel consumption. It can be concluded that
Honda is the good fuel consumption.

Classification No. of responses Percentage

Good 49 49.5

Average 46 46.2

Bad 4 4.3

How is the mileage of the vehicle?

38
Interpretation

From the above table it can be inferred that 49.5% of the respondent mileage of the
vehicle is good, 46.2% of the respondent mileage of the vehicle average ,4.3% of the
respondent mileage is the bad of the vehicle.

It can be concluded that most of the people opinion is the mileage good.

Do you recommend other people to use Honda vehicle?

Classification No. of responses Percentage

Yes 81 81.7

No 18 18.3

39
Interpretation

From the above table it can be inferred that 81.7% of the respondent recommend
other people to use Honda vehicle, 18.3% of the respondent recommend no to other
people to use Honda vehicle.

It can be concluded that most of the people says yes to recommend other people to
use Honda vehicle.

How is the driving comfort of the vehicle?

Classification No. of responses Percentage

Good 82 82.8

Bad 12 12.9

Average 4 4.3

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Interpretation

From the above table it can be inferred that 82.8% of the respondent driving comfort
of the vehicle is the good, 12.9% of the respondent average for the driving comfort,
4.3% of the respondent bad for the driving comfort of the vehicle.

It can be concluded that most of the people says good for the driving comfort.

What is your age?

Classification No. of responses Percentage

18-25 68 68.8

25-35 19 19.87

35 Above 11 11.5

41
Interpretation
From the above table it can be inferred that 68.8% of the respondent belongs to the
age group between 18-25, 19.8% of the respondent belongs to the age group between
25-35 , 11.5% of the respondent age is above 35 .

QUESTIONNAIRE
What is your age?

 18 - 25
 25 - 35
 35 above

What is your name?

-----------------

Do you use any Honda vehicle?

 yes
 no
 other

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Which vehicle of Honda are you using?

 car
 motorcycle
 other

How long have you been using the vehicle?

 1-11 months
 1-10 years
 more than 10 years

How often do you visit for the maintenance of the vehicle? 

 every week
 every month
 whenever it is required

How much do you spend on the maintenance every month?

 less than 2000 Rs

 2000-5000 Rs
 more than 5000 Rs

How is the fuel consumption of the Honda vehicle you are using?

 good
 average
 bad

How is the mileage of the vehicle?

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  good
 average
 bad

Do you recommend other people to use Honda vehicle?

 yes
 no

How is the driving comfort of the vehicle?

 good
 bad
 average

OBJECTIVE

 To know the buying behavior of consumers

 To know the consumers preference towards automobiles

 To study impact of after sales services on consumers buying

behavior

 To find out the strength and weakness of Honda

44
 INDEX

CHAPTER 1 HONDA INTRODUCTION

HISTORY
COMPANY BACKGROUND
MISSION ,VISSION AND VALUES
SWOT ANAYLYSIS
MARKETING MIX
SUCCESS STORY ;HONDA

CHAPTER 2 INICIATIVE TAKEN BY HONDA

AUTOMOBILE INICIATIVE
Power product initiatives
Maintainace support iniciative

CHAPTER 3 MAIN COMONENTS OF HONDA MOTORS

FORD
TOYOTA
Volkswagen:

45
 General Motors:
Suzuki:

FCA:
Hyundai Motors:
BMW:
Nissan:
Tata
Renault:

Suggestions

From the study we found that HONDA was placed IInd in the market. Thecompany
should try to maintain the same and adopt suitable strategies to reach the
No.1 position.

The company should also try to give certain offers to the dealer so as improve his efficiency
in the selling the Honda products which other company also give to their dealer

From the study we found that HONDA was placed IInd in the market. Thecompany should
try to maintain the same and adopt suitable strategies to reach the No.1 position.

The dealer is required to provide discount on cash purchase. The company/ showroom may
give special offers to the students at the time of booking

The company has to initiate psychological retain techniques like sending birthday,
anniversary wishes to the present customers.

46
Findings

 High priority should be given to the milage because middle class people are
using the bikes.

 Majority of81.9% of the respondents will strongly recommending to others but

18.1% of them were not.

 90% of the respondents rated Honda Dios riding comfort as superior and only 10%
of them rated as deficient.

47