Honda Case, Honda Simultaneously Developing Hybrids, Diesel,

Honda case, Honda simultaneously developing hybrids, diesel, natural gas, fuel cell cars. a. Why Honda chosen strategy? Is characteristic company industry? Should Honda pick focus efforts important Honda pursue synergies ( preserve options) developing promoting multiple technologies? b.

Honda Motor Company Ltd.

The diversification strategy and the environmentally friendly automobile

Honda is a long established and powerful presence within the international automobile industry. Throughout the past recent years, the company has become focused on a determined diversification strategy which strives to respond to the various needs of vast consumer palettes. The manifestation of this diversification strategy has materialized in the creation of four categories of vehicles -- hybrids, diesel, natural gas and fuel cell cars.

A question is being posed relative to the reasons which might have driven the Honda executives to implement this strategic approach. Two primary reasons could be offered at this stage. The first is constituted by the changing needs of the contemporaneous society. In this order of ideas, the events of the past recent years -- such as international tensions between the West and the East, the oil crises or the internationalized economic crisis -- have led to a situation in which people seek prudential spending. Relative to their automobile purchases, the populations seek vehicles which consume lower amounts of gas and can as such be maintained and operated for lower costs. Additionally, there is the social pressure towards environmental stability. This tendency has been accentuated by the growing threat of global warming. The result is that of the population demanding environmental responsibility and this pressure impacts all industries, but even more so the automobile industry.

On the other hand, the rationale could have been constituted by the fact that the other players in the automobile industry have intensified their efforts towards the creation of more environmentally friendly vehicles. In other words, the diversification of the automobiles would have been based on a competitive strategy as a diversified offer of automobiles is characteristic within the industry.

In terms of the future, a question is being posed relative to whether Honda should select a specific automobile category and focus on its production and development, as opposed to the continued diversification of its product palette. The answer is offered in favor of the second alternative, namely the maintenance of a diversified offer from which the customers can choose the vehicle which best serves their needs and wants.

In other words, the main reason in support of the diversified automobile selection is given by the need to serve as many customer needs as possible. For instance, some customers might prefer gas cars, whereas others would prefer hybrids. The diversified offer is the means to serve diverse customer needs and ensure organizational profitability.

But aside from this, the recommendation towards a diversified product palette is also supported by the uncertain future of the society. In this order of ideas, environmentally friendly automobiles are desired by the environmentally responsible consumers, but the adequate infrastructure has yet to be developed. And the future is unsure. In this line of thoughts, it would be more prudential for Honda to continue to produce various automobile models and to preserve its options.