Honda Motor Co Strategy

Honda Motor Co., Ltd., (NYSE: HMC) today announced an ambitious strategy to enhance corporate value through a major expansion of sales within each of its three product lines -- based on accelerated innovation throughout the company, including manufacturing and research and development.

With annual sales achieving an all-time record of nearly 11 million motorcycles, automobiles and power products in the most recent fiscal year (ended March 31, 2000), Honda announced a dramatic new sales target of 16 million units for the fiscal year ending March 31, 2004. "Honda's goal is to be a company at the leading edge that creates new values for our customers," said Honda President and CEO Hiroyuki Yoshino, during a press conference at the company's headquarters in Tokyo. "As a unique company with a variety of 'Powered by Honda' products and a wide- ranging customer base, we will continue the challenge to enhance the value of the global Honda brand."

Honda's FY 2004 sales target represents an expansion of all three product lines; with motorcycle sales forecast to reach 7 million units, an increase of 2.6 million units; automobile sales to reach 3 million units, an increase of 500,000 units; and power products to increase sales by 50% to 6 million units. To achieve these aggressive sales targets, Honda will focus on growth segments within each product line. The biggest increase in motorcycle sales will be achieved in Asia and other newly industrialized countries. Power product sales will expand largely through OEM engine business. The expansion of auto sales will focus on the growing light truck segment in North America and strengthening the small car line-up in Japan and Europe. Based on the long-standing philosophy of, "building products in the markets where they are sold," Honda now has more than 100 manufacturing facilities in 33 countries. Sales growth in Honda's three product lines will be based on this global production capability, with increasing local content of those regionally produced products. Beginning this fall, Honda will implement a new global manufacturing system that will position the company to establish a global product supply network to make the best use of Honda's major factories around the world.