Temple of VTEC Rumors and News - WSJ: New Honda CEO Faces Big Drop in Japan Sales

In today's Wall Street Journal the front page of the Marketplace section has an article detailing some of the challenges faced by Honda Motor Co.'s new President, Takeo Fukui.

Mr. Fukui takes the helm as Honda's Japanese Market Sales are sharply down. Models that were red hot just one year ago are suddenly also-rans in the JDM Market. In the U.S., sales remain very strong, yet Honda "has slipped on a key quality measure in the U.S." This "key quality measure" is J.D. Power & Associates' New Car Quality survey, and the slip is from 2nd to 4th place in the ranking. Another "trouble spot" noted in the text is Honda's U.S. Acura division, citing Koichi Amemiya's concession that Acura has sometimes fallen short due to a lack of clear distinction between certain Honda and Acura models. To address this lack of distinction, the Acura brand is in the midst of a makeover, which began with the MDX and will continue with the introduction of the '04 TL (what about the TSX??).

And finally, the company's said to be losing its environmental technologies leadership to the likes of Toyota and GM. This assertion is based on the notion that both companies have "far more ambitious plans for fleets of ultraclean gas-electric hybrid vehicles." Toyota's all-new Prius is trumped as being more efficient than any of Honda's cars.

The column classifies Mr. Fukui as being a strong competitor, mentioning his road to success in the company's motorcycle racing program, and implies that this trait will help Honda surmount the challenges they currently face.

Commentary

Unfortunately at this moment I don't have enough time to address all the points I would like to, but I would like to make one point that probably touches all of the "issues" mentioned by the WSJ. I suppose Honda's incredible secrecy when it comes to the disclosure of future product details and new model introductions probably helped create a slightly dour tone in the WSJ's article. Overall, I believe that Honda is clearly in the running for the leadership role in terms of environmental technology, and they are committed from top to bottom to maintaining that position for quite some time. There have long been rumors of IMA technology appearing in more mainstream models, and I'm willing to wager that Honda will be one of the first to have it in an SUV, Minivan, and/or mid/large sedan, if not a sports car.

On the quality side, I too hope Honda rights the ship and goes back to their former standards. Unfortunately, in many of their vehicles of the past few years, top notch designs have been tainted by going a bit too far in cost-cutting certain areas. I believe a better balance in terms of quality and cost can be achieved. jp