Acura was launched in the mid 1980s, and it was the first Japanese produced luxury car, however it lacked many of the features that customers were looking for in high end vehicles and Acura went through almost five years of net losses before Honda finally figured out their design and distribution methods. Honda depends too much on their ingenuity and ability to adjust once a product enters the market, and as a result, they often make hasty and faulty decisions that they must then spend millions and years to fix. Honda has significant opportunities in the near future to become the premier manufacturer in the world. The biggest opportunity lies in their technology advantage, as the frontier leader within fuel economy, they have had years of research to help them build motors that are highly fuel efficient. This applies to every single market that they operate in and with the socio-economic interest in saving fuel and find alternative solutions to energy waste; Honda could become an even bigger player within the manufacturing market than they already are. Additionally, another advantage is the flailing of other major American manufacturers that formerly had a vice grip on the American motor industry. General Motors and Ford are both in deep debt and appear to be years away from full recovery, as a result, the door is open for Honda to seize their existing market share by both pricing the competition out of the market, and by dominating the overall quality of their products. If they can leverage their current advantage on a full scale, Honda will be able to gain a significant amount of the market share that was previous taken up by GM and Ford. Finally, the emergence of new markets means that there is a market expansion for Honda products. Both China...
Honda already has a foothold in China, and are beginning to enter heavily into India and should they take control at the inception of these two powerhouses, their overall revenue should increase exponentially in the next decade.
Major markets are saturated with products. Because of high fixed costs in the industry, exit barriers are high. Competition has kept margins relatively low, so Honda must move volume since they do not have sufficient differentiation to leave the mass market category. Overall, the outlook for the automotive industry is weak for the coming years. One environmental consideration however is with respect to higher fuel costs. While this represents a
Honda Case Study Honda Motors the iconic Japanese automobile and engine manufacturer was the definitive example of the 1980's and early 90's surge of Japanese dynamism and economic muscle. "Only 25 years after the firm entered the automobile industry, the 'industry of industries', Honda had become one of the world's top ten producers" (Mair, A. 1997). Over the last two decades though Japan has been mired in a morass of economic
Until very recently, GM was not being publicly traded; after its bailout by the U.S. government, the company was required to pay down its debt and essentially purchase itself back from the taxpayers before issuing stock. This stock has now been issued, and the debt was very recently paid off, giving the company a current debt/equity ratio of .36 (GM 2011). This means that the company is primarily being
Honda case, Honda simultaneously developing hybrids, diesel, natural gas, fuel cell cars. a. Why Honda chosen strategy? Is characteristic company industry? Should Honda pick focus efforts important Honda pursue synergies ( preserve options) developing promoting multiple technologies? b. Honda Motor Company Ltd. The diversification strategy and the environmentally friendly automobile Honda is a long established and powerful presence within the international automobile industry. Throughout the past recent years, the company has become focused
Ford Motor Company Business Analysis Ford Motor Company Ford Motor Company is 4th on Fortune 500 List and 4th on Global 500 List and is the 2nd largest auto manufacturer in the world. Ford Motor Company has the advantage of Ford Motor Credit however, due to Firestone tire recalls the prices are the lowest prices in years with cash reserves sunk to $4.1 billion and $13 billion on acquisitions with $3.5 billion
Recommendations The key competitive advantages that Ford Motor Company of Canada must concentrate on include the following. First, the continue growth of supplier relationship management and tight integration at the quality level of sourcing and procurement (Baker, Artinian, 1985) is critical. This will alleviate any increases in the 78% of their cost structures that are dedicated to sourcing and procuring products, well above industry norms. Second, the use of R&D funds
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