3-page Literature Review

1.0 Executive Summary 

One of the major automobile manufacturers worldwide is the Honda Motor Company. The United States market presents various difficulties for the corporation, including falling sales, competition from other automobile manufacturers, and the requirement to invest in emerging technology. The company is also facing various issues in its home market of Japan, contending with falling sales, competition from other manufacturers, and a strong yen. These challenges are causing the company to struggle. 

The company is experiencing many difficulties in its native market of China, including falling sales, increased competition from other automakers, and a general slowdown in the economy of China (Boiral et al., 2020). The Honda Motor Company has launched a variety of different efforts in order to meet the difficulties that have been presented. The company has stated that it will be making a new investment in its manufacturing operations in the United States of America and a new commitment to developing cutting-edge technology.

The company is concentrating on expanding its sales channels and improving its product mix in the Japanese market. During its time in China, the company focuses on growing its dealer network and developing new products specifically for the Chinese market.

2.0 Analysis

2.1 Obstacles Facing Honda in the United States of America

The Honda Motor Company is experiencing several difficulties in the United States, including falling sales, competition from other automobile manufacturers, and the requirement to invest in emerging technology. In recent years, there has been a general downward trend in the sales of Honda automobiles in the United States, which can, in part, be attributed to increased levels of competition from other manufacturers of automobiles. The total number of units sold by Honda in the United States in 2016 was 1.63 million, which decreased by 4.7 percent compared to the previous year (Boiral et al., 2020). The percentage of the market that Honda holds in the United States. Similarly have decreased over the past few years, going from 9.2 percent in 2011 to 8.3 percent in 2016. 

Additionally, the business must contend with rivalry from other automobile manufacturers in the United States, such as Toyota, Nissan, and Hyundai. These businesses have increased their market share in the United States by providing customers with a more incredible selection of automobiles, which includes sport utility vehicles (SUVs) and pickup trucks. Additionally, Honda is confronted with the requirement to make investments in emerging technologies, such as autonomous vehicles, electric vehicles, and connectivity. Because of the growing significance of these technologies in the automotive sector, Honda will need to make significant expenditures to maintain its position as a market contender.

2.2 Obstacles Facing Honda in the Japanese Market

The Japanese domestic market presents a variety of difficulties for Honda Motor Company, including a decrease in sales, rivalry with other automobile manufacturers, and a full value of the yen. This situation is similar to that which exists in the global market. In recent years, there has been a downward trend in the sales of Honda automobiles in Japan, which can be attributed to the increased rivalry with other automobile manufacturers (Park & Park, 2021). The total number of units sold by Honda in Japan was 1.24 million in 2016, representing a decrease of 9.5% compared to the previous year. The percentage of the market that Honda holds in Japan has decreased over the past few years, going from 15.4 percent in 2011 to 13.8 percent in 2016.

Additionally, the business must contend with rivalry from other automobile manufacturers in Japan, including Toyota, Nissan, and Mazda. These firms have increased their market share in Japan by providing customers with a more incredible selection of cars, including pickup trucks and sport utility vehicles. The strong yen presents an additional hurdle for Honda in the Japanese market because it raises the company's vehicle prices relative to its rivals. Because of the strength of the yen, exporting Honda vehicles to other countries, such as the United States, has become more challenging for the company.

2.3 The Challenges Facing Honda in China

Honda Motor Company is also experiencing a variety of difficulties in its native market of China. These difficulties include falling sales, competition from other automobile manufacturers, and a recession in the economy of China. The sales of Honda automobiles in China have been on a downward trend over the past few years, partly because of the increased competition from other automakers (Thomas, & Maine, 2019). The overall number of units sold by Honda in China in 2016 was 782,000, representing a 12.3 percent decrease compared to the previous year. The percentage of the market that Honda holds in China has decreased over the past few years, going from 3.2 percent in 2011 to 2.7 percent in 2016. In addition, the corporation must contend with rivalries from other automobile manufacturers in China, such as Toyota, General Motors, and Volkswagen. These businesses have successfully increased their market share in China by providing customers with a more incredible selection of automobiles, including SUVs and pickup trucks (Boiral et al., 2020). A decrease in consumer demand for automobiles is one of the challenges that Honda is currently facing due to the recession in the Chinese economy.

3.0 The Initiatives Taken by Honda

The Honda Motor Company has launched many different efforts to solve the issues it is currently experiencing. The company has stated that it will be making a new investment in its manufacturing operations in the United States of America and a new commitment to developing cutting-edge technology. The company is concentrating on expanding its sales channels and improving its product mix in the Japanese market. The company's existing dealer network and its efforts to develop new products specifically for the Chinese market are focused on China.

3.1 Initiatives Undertaken by Honda in the United States

A new commitment to the development of sophisticated technologies and additional investment in Honda's manufacturing activities in the United States have both been announced by Honda in the United States (Chahande, 2022). The corporation has revealed that it will invest an additional $ 850 million in its manufacturing facilities in the United States. The Honda manufacturing plants in Ohio and Indiana will be expanded thanks to this investment. The corporation has also committed additional to developing cutting-edge technology, such as creating electric vehicles, driverless vehicles, and improved connections. Research and development in the United States will receive an investment of $215 million from Honda.

3.2 The Initiatives Taken by Honda in Japan

Honda is currently attempting to strengthen its product mix and extend its distribution channels in the Japanese market. The corporation is trying to enhance its product mix by providing customers with a more incredible selection of automobiles, such as sport utility vehicles (SUVs) and pickup trucks. Additionally, the corporation is attempting to broaden its sales channels by establishing additional dealerships and increasing the effort it puts into selling its products.

3.3 Honda's Initiatives in the People's Republic of China

Honda is working hard in China to produce new models and expand its dealer network to meet the demand of the growing Chinese market. The corporation is actively seeking to grow its dealer network and is growing the number of dealerships it operates as part of these expansion efforts (Boiral et al., 2020). Additionally, the corporation is focusing on developing new models for the Chinese market, including sport utility vehicles (SUVs) and pickup trucks.

4.0 Recommendations

The following suggestions are offered based on the investigation that was carried out:

1. Honda should concentrate on extending its distribution networks in the Japanese and Chinese markets.

2. Honda ought to prioritize the production of new models specifically for the Chinese market.

3. Honda ought to prioritize growing its dealer network in China as a priority.

4. Honda needs to concentrate on expanding its marketing efforts in the Japanese and Chinese markets.

References

Boiral, O., Brotherton, M. C., Rivaud, L., & Talbot, D. (2022). Comparing the uncomparable? An investigation of car manufacturers' climate performance.  Business Strategy and the Environment,  31(5), 2213-2229.

Thomas, V. J., & Maine, E. (2019). Market entry strategies for electric vehicle start- ups in the automotive industry–Lessons from Tesla Motors.  Journal of Cleaner Production,  235, 653-663.

Chahande, M. S. S.(2022)  “A study of various purches factor of Yamaha scooter and its impact on buying behavior vis-à-vis other competition in the segment (Doctoral dissertation, Rashtrasant Tukadoji Maharaj Nagpur University).

Park, Y. W., & Park, Y. J. (2021). Corporate Strategy for Corporate and Ecosystem Sustainability. In  Corporate Social Responsibility and Entrepreneurship for Sustainability (pp. 71-79). Springer, Singapore.