Honda Motor Company Is One

Honda Motor Company is one of the world's premier manufacturers. Over the past three decades it has taken up a dominant niche market within several industries and competes with other highly touted automobile companies for massive market entrenchment within the United States and other developed nations. The following SWOT analysis will analyze Honda to examine particular planning and business enterprises.

Honda has much strength, and in recent years it has progressed to become one of the front runners in the auto industry. Its primary strength since its inception has been making high efficiency cars at a low cost. This statement encompasses the core ideals and strengths of Honda. First, it is highly efficient because Honda designed vehicles are always well designed for maximum output with minimum input. Which means that it is lighter than most cars that it competes with, as well as providing the maximum space within any specific automobile class? The most important advantage in the current market however, is that Honda has devoted far more research into fuel efficient cars than any other competitor, with soaring gas prices and greater environmental concerns about fossil fuel usage, Honda has emerged as the leader in fuel efficiency and energy efficiency. As a result, Honda automobiles have surpassed GM and Ford for the first time last year in overall sales. The application of Honda's automobile powerless to other motorized devices such as ATVs, Water Craft, and electrical generators has made its diversification another key strength. This means that overall Honda has divested its revenue across many different platforms, investing significant research in a variety of growing demand markets such as water sports. As a result, it has gained a significant advantage over other major motor producers and its overall diversification allows it to make profits even when its primary revenue share (automobiles) lag in sales. The final strength that Honda has is it price competes in every market that it operates in. Honda specializes in creating highly efficient, but low cost products and as a result, is competitively priced in every market it operates in. This is extremely rare with large name brand manufacturers because they do not have to price compete when they dominate the brand. However, Honda has prided itself on being cost efficient and passing on these savings to their customers. The combination of these three elements makes Honda one of best if not the best manufacturers on the planet.

While Honda has much strength to their name, they also suffer from some major weaknesses. The primary weakness of Honda is oftentimes one of their major strengths as well. By sticking to their guns as the technology innovator within their industry, Honda divests much of its resources in exploring new methods to enhance their products. However, they often conduct research and innovation in fields that have no practical application until long into the future. Take for example their fuel efficiency research; Honda was the industry leader in fuel efficiency from 1985 to present. However, only until recently did gas prices raise high enough to warrant the fuel economy as a significant advantage. Had Honda divested more of their resources to other high end upgrades such as competing within the SUV market, they might have made much more profits. Thus, finding the balance between future research and current profits is one of the major weaknesses with Honda. Another one of its weaknesses is that Honda relies on its "entry first, organizes later" strategy for new market penetration. Its corporate strategy appears to be to enter established markets with their innovative products and develop an infrastructure and organization after they observe how the market reacts. Although this strategy has worked well in some cases such as Honda's entry into the light truck division, where its Ridgeline won Truck of the Year, however in other cases such as the launch of Acura success was met first by years of trial and error. Acura was launched in the mid 1980s, and it was the first Japanese produced luxury car, however it lacked many of the features that customers were looking for in high end vehicles and Acura went through almost five years of net losses before Honda finally figured out their design and distribution methods. Honda depends too much on their ingenuity and ability to adjust once a product enters the market, and as a result, they often make hasty and faulty decisions that they must then spend millions and years to fix.

Honda has significant opportunities in the near future to become the premier manufacturer in the world. The biggest opportunity lies in their technology advantage, as the frontier leader within fuel economy, they have had years of research to help them build motors that are highly fuel efficient. This applies to every single market that they operate in and with the socio-economic interest in saving fuel and find alternative solutions to energy waste; Honda could become an even bigger player within the manufacturing market than they already are. Additionally, another advantage is the flailing of other major American manufacturers that formerly had a vice grip on the American motor industry. General Motors and Ford are both in deep debt and appear to be years away from full recovery, as a result, the door is open for Honda to seize their existing market share by both pricing the competition out of the market, and by dominating the overall quality of their products. If they can leverage their current advantage on a full scale, Honda will be able to gain a significant amount of the market share that was previous taken up by GM and Ford. Finally, the emergence of new markets means that there is a market expansion for Honda products. Both China and India are becoming world powers and the overall world economy is on the rise, as a result, emergent markets require motor power at a faster pace than ever before. Honda already has a foothold in China, and are beginning to enter heavily into India and should they take control at the inception of these two powerhouses, their overall revenue should increase exponentially in the next decade.