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About HONDA R&D CO., LTD.

Honda Motor Company is Japan's #2 automaker (after #1 Toyota) and the world's largest motorcycle producer. The company's global car models include the Accord, CR-V, Civic, Fit and its new Clarity Fuel Cell model. Honda's line of motorcycles includes everything from scooters to superbikes. The company's power products division makes commercial and residential machinery (lawn mowers, snow blowers, and tillers); portable generators; an outboard motors. Its Honda Aero subsidiary also manufactures jet and turboprop engines. More than half of Honda's sales comes from North America.

Operations

Four reporting segments comprise Honda Motor's operations: the Automobile business, Financial Services business, Motorcycle business, and Life Creation and other businesses.

Automobile business generates more than 65% of total sales. It offers vehicles that use gasoline engines of three, four or six-cylinder configurations, diesel engines, gasoline-electric hybrid systems and gasoline-electric plug-in hybrid systems.

Financial Services generates more than 15% of total sales. It offers retail lending, leasing to customers and other financial services, such as wholesale financing to dealers through finance subsidiaries.

Motorcycle Business generates about 15% of total sales. Honda produces a wide range of motorcycles, with engine displacement ranging from the 50cc class to the 1800cc class. Honda's motorcycle lineup uses internal combustion engine of air- or water-cooled, and in single, two, four or six-cylinder configurations. Honda also has electric vehicles in its lineup. Honda's motorcycle lineup consists of sports, business and commuter models.

Life Creation and Other Businesses generates more than 1% of total sales. Honda manufactured a variety of power products including general purpose engines, generators, water pumps, lawn mowers, riding mowers, robotic mowers, brush cutters, tillers, snow blowers, outboard marine engines, walking assist devices and portable battery inverter power sources.

Geographic Reach

Headquartered in Tokyo, Honda's major geographic areas are concentrated in North America (the US, Canada, and Mexico); Asia (Thailand, Indonesia, China, India, Pakistan, and Vietnam); Japan; and Europe (the UK, Germany, Italy, Belgium, France). North America generates roughly 55% of net sales while Asia brings in more than 20% of sales. Japan accounts about 15% and Europe and other regions generates about 10% of sales combined. The Financial Services business provides financing and leasing through its subsidiaries in Japan, the US, Canada, the UK, Germany, Brazil and Thailand.

Sales and Marketing

Most of Honda's products are distributed under the Honda trademarks in Japan and/or in overseas markets. In Japan, Honda produces and sells motorcycles, automobiles, and power products through its domestic sales subsidiaries and independent retail dealers.

Financial Performance

Honda's consolidated sales revenue for the fiscal year 2020 (ended March), decreased by ¥957.6 billion, or 6.0%, to ¥14.9 trillion from the fiscal year 2019 (ended March), due mainly to decreased sales revenue in the Automobile business as well as negative foreign currency translation effects, which was partially offset by increased sales revenue in the Financial services business.

Profit for the year decreased by ¥166.3 billion, or 25%, to ¥509.9 billion from the previous fiscal year.

Consolidated cash and cash equivalents on 2020 (ended March) increased by ¥178.2 billion from 2019 (ended March), to ¥2.7 trillion. Net cash provided by operating activities amounted to ¥979.4 billion of cash inflows, while net cash used in investing activities amounted to ¥619.4 billion and net cash used in financing activities amounted to ¥87.4 billion.

Strategy

Honda engages in business operations through alliances and joint ventures with other companies in expectation of synergy effects and increased efficiency, or to meet the requirements of the countries in which business development is being undertaken.

As Honda advances its mid- and long-term initiatives toward further electrification, more widespread use and evolution of driver-assistive technologies, and further provision of mobility services, the utilization of alliances and other forms of partnership are gaining importance.

Going forward, trends in the negotiations regarding trade agreements, particularly those related to the United States, could have adverse effects on Honda's business and operating results. Honda will continue to monitor the status of negotiations and take action in consideration of the impact on Honda.

Especially noteworthy is the fact that the United States-Mexico-Canada Agreement (USMCA) is expected to enter into force in July 2020. The revision of various rules such as the rules of country of origin for automobiles sold within the regions covered in USMCA may adversely affect Honda's business in North America.

Mergers and Acquisitions

In late 2019, Honda R&D Co. Ltd. a subsidiary of the Japanese automaker has announced the acquisition of all the outstanding shares of California-based, Drivemode Inc. a company that develops smartphone apps for drivers for an undisclosed amount. Honda claims, this move will further strengthen the automaker's new value creation in the areas of digital and connected mobility products.

HONDA R&D CO., LTD.

1-4-1, CHUO
WAKO, STM 351-0113
Phone: 81 (048-) 048-461-2511

Firm Stats

Employer Type: Unknown
Managing Director: YOSHIHARU ITAI
Managing Director: AYUMU MATSUO
President: TOSHIHIRO MIBE

Major Office Locations

WAKO, STM

Other Locations

Asaka, Japan
Fujisawa, Japan
Haga-Gun, Japan
Hamamatsu, Japan
Kamikawa-Gun, Japan
Kikuchi-Gun, Japan
Minato-Ku, Japan
Sakura, Japan
Sayama, Japan
Shioya-Gun, Japan
Suzuka, Japan
Wako, Japan