According to President Donald Trump, Japan, one of the US’s biggest trading partners, has agreed to a “massive” trade agreement with the US. According to Trump’s social media post, the idea would result in Japan investing $550 billion (£407 billion) in America and US imports from the Asian nation being subject to a 15% levy.
Key Highlights of the U.S.–Japan Agreement
He went on to say that Japan will allow American products, such as rice, trucks, vehicles, and some agricultural products, to enter its economy. Shigeru Ishiba, the prime minister of Japan, praised the announcement, stating that it was the lowest number among nations having trade surpluses with the US to date.
Tariff Reductions on US Autos and Agricultural Exports
At a White House event on July 22, Trump boasted that he had recently struck what he believes to be the biggest trade agreement ever with Japan. He went on to say that the squad had put in a lot of time and effort on it, and that Japan has its best personnel here. And it’s a fantastic bargain for all. “I constantly stress that it must be fantastic for everyone.
“It’s a fantastic deal,” Trump said. In an interview with reporters on July 23, Ishiba stated that the deal would reduce US car and part tariffs from 25% to 15%. “We were the first in the world to reduce tariffs on cars and auto parts without any quantity restrictions,” he stated. “The agreement does not include any reduction of tariffs on the Japanese side,” Ishiba stated.
Japan’s Billion Dollar Investment Commitment
Shigeto Nagai of Oxford Economics, a research firm, told BBC News that Japan’s “best compromise at this stage” is to lower its main tariff rate to 15%. The announcement’s mention of Japan’s planned investment in the US “will be a huge boost to restore the US, fitting in with Trump’s story of reviving US manufacturing with more jobs,” he continued.
Political Context in Japan Following the Deal
This month, Trump threatened to impose a 25% tariff on Japan’s exports to the United States unless a new trade agreement was reached by August 1. This was one percentage point higher than the 24% rate that was announced during his so-called Liberation Day on April 2.
Following global market turbulence, the April tariffs plan—which included levies on numerous US trading partners worldwide—was put on hold for ninety days. It gave the trade delegates from Tokyo more time to engage in talks with their Washington colleagues.
Market Reaction: Japan’s Stock Surge
The Nikkei 225, Japan’s benchmark stock index, rose more than 3% on 23 July in Tokyo, driven primarily by advances in shares of the country’s largest automakers, such as Toyota, Nissan, and Honda. The alleged agreement comes as Ishiba faces pressure to resign following the weekend elections that cost his Liberal Democratic Party (LDP) the majority in the nation’s upper house. Last year, the LDP lost its majority in Japan’s lower house, which has more influence.
Uncertainty surrounds the fate of a Japanese private lunar lander that lost communication on 6 June while descending to the moon.
The lander, dubbed Resilience, successfully left lunar orbit, according to Tokyo-based iSpace, but communication was lost during the hour-long descent phase. At crucial points, the company’s broadcast abruptly ended.
As Mission Control worked to reconnect, a commentator in Japanese stated that there was still no confirmation of the landing. According to a Japanese media report, one of the commentators stated in Japanese, “We haven’t been able to confirm,” and that Mission Control “will continuously attempt to communicate with the lander.”
After an unsuccessful trip two years prior, this was iSpace’s second attempt to land on the moon. As a tribute to their tenacity, the firm had given this new craft the name Resilience.
The lander carried a miniature red house made by a Swedish artist and a small rover intended to gather lunar material. Since 2019, private companies have joined government space agencies to explore the moon, with varying degrees of success.
Launched from Florida in January, Resilience travelled on Firefly Aerospace’s Blue Ghost, the first private craft to land on the moon safely earlier this year, before reaching lunar orbit.
ispace’s Lander Targeted Mare Frigoris
Mare Frigoris (Sea of Cold), a crater-rich area with ancient lava flows on the moon’s northern near side, was the objective of iSpace’s lander. It was anticipated that the 2.3-metre-tall Resilience would deploy its rover over the weekend and start sending pictures soon after landing.
Tenacious, a five-kilogram rover manufactured in Europe, was made of plastic reinforced with carbon fibre. It had a shovel that NASA had commissioned and a high-definition camera. With a targeted range of up to one kilometre over a two-week operating window, the rover was intended to remain close to the lander while travelling at a modest pace of centimetres per second.
The Moonhouse, a little red residence designed by Swedish artist Mikael Genberg and intended for installation on the lunar surface, was also transported by the rover as a symbolic act. Takeshi Hakamada, CEO of iSpace, described the expedition as a first step towards next endeavours, including the development of a larger lander in collaboration with NASA for a planned trip in 2027.
Hakamada had stated his faith in the lessons learnt from the first failed mission before the landing attempt. In a statement, CFO Jumpei Nozaki reaffirmed the company’s commitment to lunar exploration “regardless of outcomes”.
However, Jeremy Fix, chief engineer of ispace’s US division, admitted the financial realities at a recent space industry conference, stating that the organisation “cannot sustain repeated failures”. Although the new mission’s cost was not made public, it was said to be less than their first, which cost more than $100 million.
Other Private Firms Pushing their Moon Mission
There are other private companies that are still striving for success. Astrobotic Technology and Blue Origin are preparing missions for the year-end. After failing to reach the moon in 2024, Astrobotic returned to Earth’s atmosphere.
Only five countries have accomplished robotic moon landings to date: the US, China, India, Japan, and Russia. With 12 NASA astronauts stepping on the moon between 1969 and 1972, the US is the only country to have landed humans.
Next year, NASA plans to send humans back into lunar orbit and use SpaceX’s Starship to make a commanded landing. Additionally, by 2030, China intends to send humans to the moon.
No, this is not a magic spell from Harry Potter’s world. In English we call the above phrase ‘Mitsubishi corporation’ which is equally magical as a spell. This article is a dissection of the businesses they do, their business model and the philosophy they operate with. So, take your diving suits with you and get ready.
Headquartered in Tokyo, Japan. If we dive into the articles of this company we will find that it reflects quite a clear view of their working areas. It says that the company will be involved in diversified businesses including purchase, sale, manufacturing and development of products. Logistics, new business development, providing services in a broad range of fields, either through the company itself or with any other company in which they hold shares or interests. Okay, that is a lot of areas.
Thinking of one, Of all. – The tagline
Shoki Hoko (Corporate Responsibility to Society), Shoji Komei (Integrity and fairness) and Ritsugyo Boeki (Global Understanding Through Business) are the three prime philosophy pillars of this Global Brand.
Mitsubishi is an Integrated business enterprise with offices and subsidiaries in 90 countries and approximately 1,700 group companies worldwide. Their 10 business groups are engaged in a wide range of businesses across virtually every industry, ranging from natural resources to the items used in everyday life. Mitsubishi manages a variety of operations in locations across the globe working to achieve sustainable growth for the company and Society.
Mitsubishi evolution
Mitsubishi Mission
Their mission is to provide optimal business solutions to societal needs. Their food and consumer goods businesses help provide a stable supply and resources for everyday life. Engaging in each link of the supply chain, from the production of raw materials to processing, logistics and sales, we provide products that are safe, secure and highly traceable. In the fields of mobility and infrastructure their operations support the sustainable growth of cities. These include Automotive business, airports and other businesses that facilitate the smooth flow of people, goods and data as well as dedicated urban development projects.
The company has vehicle manufacturing facilities in Japan, the Philippines, Thailand, and Indonesia, and 12 plants co-owned in partnership with others. Mitsubishi has had a 30-year-long association with actor Jackie Chan, who has used their vehicles almost exclusively in his movies throughout his career.
They also invest in mineral resources and metals projects which are vital in so many ways to the growth of prosperous cities. Energy and power essential for both quality-of-life and industrial development, Operations there include liquefied natural gas or LNG as well as wind power and other renewable energy businesses. By providing a stable supply of energy and power they are helping to realise Sustainable societies. Having their roots in trade, Mitsubishi Corporation has flexibly adapted their business models in line with the ever-changing needs of society. Once again we are in a new era, this one Defined by innovative digital technologies. In order to continually evolve as a company they are taking on new challenges in this space as well. Since their Foundation the three corporate principles have underpinned our commitment to create a new value hand in hand with society.
Mitsubishi Facts
The Mitsubishi logo was derived from the flag design of its shipping company predecessor. The three triangles are actually based on the shape of a water chestnut. In Japanese, the word for three is “mitsu,” and the word for water chestnut is “hishi.” However, “hishi” is pronounced as “bishi” when used in the second half of a word. The combination generated the name Mitsubishi.
The logo design, originally created for the shipbuilding company, was based on a blending of two family crests. It existed for many years before the automotive manufacturer’s version was trademarked in 1914.
Sold in over 160 countries around the world, Mitsubishi has established itself as the 16th largest automotive manufacturer in the world. Over the years, Mitsu has partnered with other leading brands including Volvo, Chrysler, and Hyundai to produce vehicles sold around the globe.
In 1976, Mitsubishi developed the Silent Shaft engine, reducing vibration in 4-cylinder setups. After patenting the groundbreaking technology, they then licensed it to several other big-name manufacturers including Porsche an Saab.
The Mitsubishi brand name was not introduced in the U.S. until 1982, when their sedan, the Tredia, and coupes, the Cordia and Starion, hit the scene. When sales started out, Mitsubishi’s cars were sold through 70 dealers in 22 states. But by the end of the ’80s, the company had run its first U.S. ad campaign and significantly increased its presence.
Speaking of Guinness Book records, Mitsubishi beat five of them in 24 hours in 2011. Taking their newly released Outlander and Outlander Sport to remote Canada, they racked up a series of unrivalled achievements in one day.
Greatest distance driven by a vehicle in reverse on snow in 30 seconds (300 meters)
Shortest braking distance by a vehicle on ice (56.2 meters)
Most vehicle figure eights on ice in two minutes (3 laps)
Fastest vehicle slalom relay on ice (1 minute, 11 seconds)
Fastest driven square lap (19 seconds)
Mitsubishi Business Model
Mitsubishi Corporate Strategy Model 2021
Midterm corporate strategy 2021, showing business portfolio (Business management model)
This business portfolio shows clearly that the most business of the company comes from the mineral resources area and the second most investment balance is in motor vehicles, machinery and equipment and steel. Investments that show an upward trend in these times are
The reason behind this up jump In investments can be the unprecedented times we all are facing, that is the pandemic. Also, the future lies in electricity and is going to be about sustainability development and natural resources. So, the company wants to invest in the future via the course available through their widespread businesses. We can also see a downward trend in the retail business because of the Covid-19.
Mitsubishi planning reorganisations across fields of its presence(Mitsubishi Midterm 2021)
The company revealed in the annual business portfolio that the company will be forming more business groups for the likes of natural gas, industrial materials, Petroleum and chemicals, Minerals etcetera. While the LNG demand is rising because it is the prime resource in the power and industrial sector in the Japanese market, Their mission is to tap this demand via adjustments or betterment in the present scenario to be in sync with the rising demands.
Industrial materials are an ever increasing competitive market and diversifying materials are likely to provide the opportunity of diversification. The company is planning to redefine the role that they play In this scene. The food industry faces challenges of diversifications. Mitsubishi plans to tap this trouble too by introducing more stable and sustainable business models around this field. To calm societal problems around supply chain management. With the same target to spearhead into solutions, Mitsubishi also plans to jump around some stuff here and there in the Consumer Industry, Power solutions and Urban development to make their existing businesses in these domains more efficient and well planned.
Consolidated Net Income 2021
How does Mitsubishi make money?
The Company is actually a group of group of companies stacked together in harmony, Including but not limited to these groups –
One of the most prominent or major source of revenue for Mitsubishi is their automotive business, That is known to us as Mitsubishi Cars. They started manufacturing cars from 1917, a luxury vehicle for the government officials. They decided to jump into motorsport with the “Macau Grand Prix” In 1962. With an inception like this, Mitsubishi went through a long history of vehicles, made for everyone. They were sold in America, Japan and eventually spread out in the whole world. From that time, Their Automotive business became a major and prime source of the revenue.
In one of its leading places, North America, The company determined its initial target audience to be consumers under the age of 45, typically married, and with an annual household income above $55,000. Mitsubishi strategised about the best ways to reach this demographic group. The company’s solution was to pitch the Galant as an antidote to the drab routines and responsibilities of adulthood. So they came up with a tagline “Wake Up and Drive”. After cars this magnanimous giant corp is moving its legs to electric future. Yes, Mitsubishi Electric, a new sustainable approach to transportation that is matching the company’s tagline of sustainable future. Truly Thinking of one, of all.
So, we see that the company is totally diversified to too many areas. Be it manufacturing, development, services, transport of all sorts and what not. Let’s look at some interesting data touch points in representation.
Conclusion
The company has established itself as a global brand with its strong position in different spheres.
It is a group of companies packed together for synergy.
It operates heavily on its Automobile business and invests primarily in various sustainable resources.
The philosophy of this Corporation has three edges Shoki Hoko (CSR), Shoji Komei (Integrity) and Ritsugyo Boeki (Understanding).
It plans to go with the aim of sustainable growth in future, meeting the current pandemic needs.
FAQs
What is Mitsubishi known for?
Mitsubishi is among the top automotive manufacturer that sold in over 160 countries around the world.
What country was Mitsubishi founded in?
Mitsubishi was founded in 1870, Tokyo, Japan.
How much money does Mitsubishi make a year?
Mitsubishi Corporation generated revenue amounted to around 15-16 trillion Japanese yen.
What products does Mitsubishi make?
Mitsubishi products include products in several industries that are:
SHIFT which is a software testing company that is based in Japan has seen an increase in its stock price of around 5,300%. The CEO of the company has shared the secret behind the surge in the stock price of the company. Let’s look at the reason for this bull run in the stock price of the company.
Shift was established in the year 2005 by Tange. He was grown up in an ordinary family in the Southwest Japan and started the company after completing his master’s in mechanical engineering and spending more than 5 years in working for a consulting firm.
Before entering the software testing business in 2009, Shift was involved in advising companies on how to improve their profits. Tange had conveyed that he would want to change the perception towards the job of software engineering from considering it as a second-rated job by increasing their pay.
For example, for a service that would be charged in the market for 3 million yen would be charged 2.5 million yen by the company. This strategy helped them win more clients and the engineers who would get paid around 400,000 yen for their work would be paid 700,000 yen by Shift. This was possible by cutting down the middlemen.
Yusuke Santo who is a software developer of a company acquired by Shift has said that his salary had jumped more than 70% post the acquisition. He said that Shift was a huge turning point in his career. Shift has acquired more than 14 firms from the year 2015 with an increase in their number of permanent engineers from 228 to 3,308.
Tange has conveyed that his business model is an attempt to remove the inefficiencies in the software industry of Japan. The subcontractors take cuts from the top industry and later pass on the work to the lower companies which reduces the pay of the engineers.
He also said that it is a step to taking a break from the Mergers and Acquisition strategy of buying a business in order to reduce the cost. He conveyed that he is on a mission to rescue the young employees and would want to create a fair working environment through the Mergers and Acquisitions.
Rise in Shift’s Shares
The shares of Shift Inc. have seen a rise of more than 5,300 % since the day it went public in the year 2014. The company is considered to have shown the second-best performance in the benchmark of the Tokyo stock index.
The market capitalization of the company has seen an increase to around USD 2.3 billion, where Tange holds 33 % of the stock which has a valuation of about USD 745 million.
The market size of IT Industry in Japan
The Strategy of Shift behind the surge of Stock price
The CEO of the company Masaru Tange has shared the strategy where he says that increasing the pay of his engineers is the secret behind the surge in the stock price of his company. He conveyed that he acquired smaller firms and increased the pay of the workers. This is the ultimate strategy that boosted the share price of the company.
The company would acquire other businesses that are at the bottom of the supply chain industry and increased the salary of their engineers. He communicated that he is able to do so and charge competitive prices from the company’s clients by cutting down the company’s that act as a middleman in the outsourcing process.
He added that having more workers in your company leads to an increase in the number of sales.
According to Go Saito who is an analyst has conveyed that increasing the number of engineers leads to an increase in the revenue as the company will be able to do more business. The sales of the company can be derived by multiplying the number of engineers and the unit price for engineers.
He also conveyed that the company has a highly qualified human resource as they have created a framework of skill developed engineers. In the year August 2020 the revenue of the company had increased to 28.7 billion yen compared to 208 million yen 3 years back.
The company forecasts an increase in its revenue this fiscal year to 45 billion yen and is expecting to reach 100 billion yen by the end of 2025. The CEO of the company has said that the company is the best in its field in Japan.
FAQ
Who is the founder of Shift?
the Founder of Shift is Masaru Tange who founded the company in 2005.
What does Shift Inc. do?
Shift is a software testing company, headquartered in Tokyo.
What is the revenue of Shift?
The revenue of Shift was ¥28,712,177 thousand in 2020.
Conclusion
The shares of Shift haven’t fallen much and the most recent was during the month of October where the company had seen a fall of around 22% as investors had sold high-technology stocks. Even after the fall in shares, the company is estimated to be trading more than 80 times the estimated earnings.
Dreaming about beginning a company abroad and hunting for the world’s most startup friendly countries? It has never been easier to launch a company abroad in today’s globalized economy. It is worth investing in exploring the right place to suit your business if you are thinking about beginning a startup abroad. Even if it’s not as straightforward as it seems to us everybody knows that starting a business is always a company.
Think and Decide
A startup will thrive in many ways including dedication, inspiration, creativity, talented workers, aspiring leaders, and, of course, an outstanding concept. Investments, accelerators, and incubators funding and a solid and well-developed ecosystem should also be made readily available. Tax incentives for entrepreneurs and government funding should also be offered in order to achieve their dreams and to take chances on the road to growth. There are several aspects deciding what makes a country that is ideal for start-ups.
Keeping all these factors in considerations, here are the top 10 startup-friendly countries:
1. Germany
Germany Flag
Germany is the fourth-largest economy in the world and the largest in Europe. It provides a competitive funding climate for start-ups, a clear organizational culture, and a well-trained workforce. English is widely spoken all over, making creating a global corporation smoother and attracting diverse skills. Germany gives start-ups favorable funding choices and straightforward corporate culture. German firms are funded by the most popular foreign investors including Earlybird VC, Ciaran O’Leary, etc. In addition, the nation has a highly trained population, global ties, a skilled workforce, and a sophisticated infrastructure.
A reputation for conservativeness, old fashion and risk-averse in the Japanese marketplace. Yet this mentality is evolving and it has made the entrepreneurship community expand rapidly. In 2018 it began the ambitious J-Startup program aimed at generating 20 unicorns or listed companies by 2023. There are roughly 10,000 start-ups in the world according to the Japanese Ministry of Economics. This has been possible through creative thinking, technology skills, advanced networks, a well-trained ex-pat population, competent staff, etc. This has been possible.
As the nation has a well-evolving community and a long tradition of entrepreneurship, the U.S. is not new to the innovation ecosystem. Silicon Valley is known around the country for its world-famous start-up center, as are Atlanta, New York, Austin, San Diego, San Francisco, and others. As a result, several people decide to immigrate to the US in order to start a business. Some of the best examples of successful start-ups are Google, Uber, and Facebook. The amount of financing given to young ventures has increased, leading to the growth of entrepreneurship.
The UK is well known for numerous technology start-ups. Britain is now famous for its presence in colleges of world-class and a diverse pool of foreign talent. The UK startup community has not ceased manufacturing creative businesses like Revolut, Move Wise, and Perkbox amid shaky talks on Brexit and an unpredictable future. Start-ups in the United Kingdom profit from Europe’s highest population of English, easy business entry, and highly trained, highly skilled workers. The British new technology economy is full of talent to choose from, with a population of 2.1 million.
Canada gives founders and start-ups a comprehensive support structure that includes a wealth of activities and programs. Increase business practices, trained people, a well-developed facility and competitive foreign exchange rates are open to Canadian start-ups and more. With many seeing it as one of the most appreciated countries in the world not only to develop a corporation but to establish families and raise children, Canada has become one of the best locations. It may be a powerful company, access to a wide talent pool, or welcome, but it seems that Canada is gaining a lot of fame as one of the most promising countries on a business trip.
Switzerland is regarded as a tranquil paradise with magnificent lakes, glaciers, and mountains. However, elegance does not keep the European start-up community from being broken. According to this assessment, the fact that a company starts in Switzerland has more positive than negative implications, so it is a very good chance for entry into a stable market with access to the European markets in order to be stable, creative, and productive, it helps you to test your product or service in a multicultural environment. Thanks to the presence of a trained population, a well-established regulatory environment, and quick access to capital for enterprises, the country has a successful startup ecosystem.
Sweden is a unicorn factory in the industry as it is home to valuable industries across the world. There is a tiny domestic market in the world, which pushes start-ups and entrepreneurs to think internationally from the beginning and take them to high levels. Despite Stockholm, the capital city of Sweden, which is per capita the second most active technology center of the world after Silicon Valley, many consider that the Swedish economy is being powered by big companies. However, 99% of all companies in Sweden are small firms, currently hiring four out of five individuals.
Australia is in the Royal proclamation. There are also several islands in the world, particularly Tasmania. The area was settled by aboriginal people at least 40,000 years before the first British settlers in the 1700s. Australia ranks fifth when it comes to women entrepreneurship, one of the world’s most start-up-friendly countries. It was reported that either migrants or their children founded 57% of start-ups in the country and 20% of workers are foreign talent. Australia has achieved a well-built community, infrastructure, and regulatory system in terms of education. Australia has scored.
Opposition to the southern part of the Korean Peninsula South Korea, formally the Republic of Korea, is a region with a long tradition of violence in Eastern Asia. Freed from Japan at the conclusion of World War II in 1945, South Korea was occupied in North Korea a couple of years later by Communist Forces. South Korea has experienced rapid economic growth and is now the world’s 11th largest economy. In recent years, there has been an immense increase in the country’s technology start-up ecosystem. With the various investments of these start-ups, this is likely. In 2017, 2.38 trillion start-ups were spent, and by 2018 hit 3.42 trillion.
Singapore is the busiest metropolis in Southeast Asia and home to one of the world’s most busy ports, established as a British trading colony in the 19th century. On the eponymous capital island, the vast majority of its 5,7 million people remain, and the city-state is complete by hundreds of neighboring islands. The government encourages startups with large incentives and creative policies favorably. In addition, Singapore has an advanced ecosystem of entrepreneurs with multiple incubators and accelerators. More than 150 risk capital investors in the country are also responsible for the growth of these start-ups.
Various aspects contribute to an environment of diverse entrepreneurs. Firstly, government funding in the form of monetary benefits and other programs must be consistent. The next key consideration is unimpeded access to highly trained and eligible workers. The country’s position is also significant, as it can make foreign markets easier for companies to enter.
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Honda Motor Company, Ltd. is a Japanese public multinational conglomerate corporation primarily known as a manufacturer of automobiles, motorcycles, and power equipment. Honda Motor Co., Ltd. operates under the basic principles of “Respect for the Individual” and “The Three Joys” commonly expressed as The Joy of Buying, The Joy of Selling and The Joy of Creating.
Honda has been the world’s largest motorcycle manufacturer since 1959, reaching a production of 400 million by the end of 2019, as well as the world’s largest manufacturer of internal combustion engines measured by volume, producing more than 14 million internal combustion engines each year. Honda became the second-largest Japanese automobile manufacturer in 2001. Honda was the eighth largest automobile manufacturer in the world in 2015.
Honda Motor Co., Ltd. engages in the manufacture and sale of automobiles, motorcycles, and power products. It operates through the following segments: Automobile, Motorcycle, Financial Services, and Power Product and Other Businesses.
The Automobile segment manufactures and sells automobiles and related accessories. The Motorcycle segment handles all-terrain vehicles, motorcycle business, and related parts. The Financial Services segment provides financial and insurance services. The Power Product and Other Businesses segment offers power products and relevant parts. The company was founded by Soichiro Honda on September 24, 1948 and is headquartered in Tokyo, Japan.
Honda was the first Japanese automobile manufacturer to release a dedicated luxury brand, Acura, in 1986. Aside from their core automobile and motorcycle businesses, Honda also manufactures garden equipment, marine engines, personal watercraft and power generators, and other products.
Since 1986, Honda has been involved with artificial intelligence/robotics research and released their ASIMO robot in 2000. They have also ventured into aerospace with the establishment of GE Honda Aero Engines in 2004 and the Honda HA-420 HondaJet, which began production in 2012. Honda has three joint-ventures in China: Honda China, Dongfeng Honda, and Guangqi Honda.
Honda – Logo and its Meaning
The stylized design of the capital H had a certain influence on the print. It is distinguished by the absence of decorative details and minimalistic design bordering on austerity. At the same time, chromium coating of the innovated logo’s font makes it quite prestigious and valuable. The line width helps it stand out clearly on the background.
Honda’s Company Logo
Honda – Founder and History
The engineer Honda Soichiro founded the Honda Technical Research Institute near Hamamatsu in 1946 to develop small, efficient internal-combustion engines.
Founder of Honda
It was incorporated as Honda Motor Company in 1948 and began producing motorcycles in 1949. The Honda C-100, a small-engine motorcycle, was introduced in 1953 and by 1959 was the largest-selling motorcycle in the world. In 1959 the company also established a U.S. subsidiary, the American Honda Motor Company, which began producing motorcycles in the United States in 1979 and automobiles in 1982.
While still Honda is a world leader in producing motorcycles, the bulk of the company’s annual sales comes from automobiles, which the company began manufacturing long ago. Among its lightweight, fuel-efficient passenger cars have been the popular Civic and Accord models. The company’s other major product areas include farm machinery and small engines. Honda is a major Japanese exporter to the United States and to other parts of the world. It also has assembly plants in a number of other countries and is engaged in joint ventures and technology-licensing agreements with several foreign companies.
Honda – Mission
Honda’s mission statement says, “Maintaining a global viewpoint, we are dedicated to supplying products of the highest quality, yet at a reasonable price for worldwide customer satisfaction.”
Automotive (~71%) – Honda derives a majority of its revenue from the sales of its automotive units around the world. Per Bloomberg intelligence, 75% of the vehicles Honda sells in the US market are manufactured in the country itself. Additionally, the company does not expect a significant revenue impact from recently imposed tariffs in the US as it manufactures a notable quantity of its US volumes in the domestic market itself. We expect automotive sales of 5.35 million worldwide, translating into $104.7 billion in revenues from this division.
Motorcycle (~14%) – Honda derives $18.4 billion in revenues from the sales of its motorcycle units. This segment includes motorcycles, all-terrain vehicles (ATVs) and Personal watercraft (PWC). We expect higher sales volume of its motorcycle business to drive its top-line growth in 2019. The increased volume sales are expected in its key markets of Asia, including Indonesia, India, and Vietnam. Honda’s Activa and X-blade models continue to be the bestsellers in these markets in 1Q’19.
Financial Services (~13%) – Honda provides a variety of financial services – retail lending, leasing to customers and wholesale financing to its customers and dealers through its finance subsidiaries. Within the financial services segment, North America contributes about 90% of the segment’s revenue. We expect the segment to generate $19 billion in revenue in 2019.
Power and Other business (~2%) – HMC manufactures and markets a complete range of power equipment products for commercial, rental, and residential applications. Its comprehensive product line, which includes tillers, portable generators, outboard engines, water pumps, lawn mowers, snow throwers, general purpose engines, electric four-wheel scooters, is powered exclusively by advanced 4-stroke engines. These products are sold by the company in its markets, mainly in Japan, and are also sold to Original Equipment Manufacturers (OEM).
Honda – Revenue and Growth
Year
Amount
Percentage Change from last year
2020
$137.365B
-3.94%
2019
$142.998B
+3.43%
2018
$138.25B
+6.19%
Honda – Investments
Honda Motor has made 12 investments. Their most recent investment was on Jul 18, 2020, when Contemporary Amperex Technology raised CN¥19.7B.
Date
Organization Name
Round
Amount
Jul 18, 2020
Contemporary Amperex Technology
Post IPO Equity
CN¥19.7B
Jun 28, 2019
MONET Technologies
Corporate Round
¥499.9M
May 14, 2019
Moixa Technology
Corporate Round
£8.6M
May 7, 2019
Cruise
Corporate Round
$1.2B
Mar 28, 2019
MONET Technologies
Corporate Round
¥498M
Mar 5, 2019
ubitricity
Series C
€20M
Oct 3, 2018
Cruise
Corporate Round
$750M
Nov 6, 2017
Mcity
Venture Round
$11M
Sep 19, 2016
Grab
Series F
$750M
Jun 8, 2010
Virent Energy Systems
Series C
$46.4M
Honda – Acquisition
Honda Motor has just one acquisition. Honda acquired ubitricity on Feb 27, 2019.
Honda – Competitors
Major names among Honda’s competitors include – Ford, General Motors, Toyota, Suzuki, Volkswagen, Hyundai, Nissan, FCA (Fiat Chrysler Automobiles), BMW andMercedes.
The automobile crisis of 2008-2010 was the part of financial downturn, which affected automobile makers and suppliers around the world. The industry was weakened by the substantial increase in the prices of fuel linked to energy crisis of 2003-08 which discouraged purchases of automobiles with low fuel economy. In the year 2008 there were fewer fuel efficient models to offer to the consumers, the bigger automobiles including General Motors, Toyota, Ford, Chrysler, Nissan and Honda Motors experienced sliding sales.
Honda has used PEST and SWOT analysis to work harder to achieve the goal to make their sales go high, and have worked on the weakness in the market as well. Honda has studied their PEST analysis and the factors that are affecting their company, being the leading automobile industry has to know its strengths and weakness, when dealing with their customer. All they needed was to know their needs, wants and demands.
Honda is going bullish on its expansion plans. Honda currently holds the number two position in terms of domestic sales, behind Hero MotoCorp, and plans to become number one by December 2020. To achieve this, the company is expanding both, manufacturing and sales. Last year, the company added a fourth assembly line at their Narsapura manufacturing facility in Bengaluru. This move adds 6 lakh units to Honda’s current capacity of 64 lakh bikes and scooters per year. For sales, Honda has set a target of adding 500 retail outlets this year, to its existing 5,200 dealerships. Of these, Honda has already added 250 outlets from April to August and will be adding 50 more this month. Honda is specifically concentrating on rural areas with 70 per cent of the new outlets coming up this year to be situated there.
Honda has been recording strong sales with currently a 30 per cent overall domestic market share for two-wheelers. It is currently the market leader in scooter sales with a 69 per cent market share. While their scooter sales have been strong, Honda wishes to focus more on motorcycle sales now.
Honda is further accelerating its electrification plans for Europe by moving forward its goal for all of its European mainstream models to feature electrified powertrains by 2022. The bold new target announced during an ‘Electric Vision’ event in Amsterdam, is three years ahead of the previously announced 2025 goal, demonstrating the confidence Honda has in its electric and hybrid powertrain technology. This acceleration will see 6 electrified models launched over the next 36 months.
