Honda promotes American managers in push to revive U.S. market

By ALAN OHNSMAN / Bloomberg News

Honda Motor Co. was the first Asian carmaker to build autos in the U.S. and is the most dependent on the market. Now it's also putting more non-Japanese in key roles.

North American Chief Operating Officer Tetsuo Iwamura becomes executive vice president April 1 and No. 2 to President Takanobu Ito. His new seven-member board will manage activities from product planning to production to sales in North America. Three members will be U.S. natives, the first time Americans have held such responsibility, including Erik Berkman to lead regional product development and design.

"Honda quite literally has become a North American car company headquartered in Tokyo, and that's a horrible combination," Jim Hall, principal of 2953 Analytics Inc., an auto consultant in Birmingham, said in a phone interview. "When your headquarters isn't in your most important and biggest-volume market, you become disconnected. We can see that's what's been happening to them. This is to reconnect headquarters with their most important market."

While Honda's U.S. problems have been less dramatic than those of Toyota Motor Corp., which recalled millions of vehicles for unintended acceleration, they've been significant. Even before last year's earthquake and tsunami cut supplies, core Honda cars such as the Civic and Accord were losing ground to Hyundai Motor Co. and Ford Motor Co. models that won praise for stylish looks and fuel economy.

Growing competition spurred Honda to offer U.S. incentives that were 87 percent of the industry average in this year's first two months, according to Woodcliff Lake, New Jersey-based Autodata Corp. In 2008, Honda's discounts were less than half the average.

'Out of Necessity'
"For too long they've lived in this cocoon of 'What we're doing is good enough,' " said Maryann Keller, principal of a self-named consulting firm in Stamford, Conn. "There's a recognition that that's no longer the case, so I think they are making these moves out of necessity."

For the first time, Honda's No. 2 executive will be based at the company's U.S. headquarters in Torrance, Calif., instead of Tokyo.

"Knowing the current competitive and complicated marketplace, rapid changes in customer needs, we think it's better to put more emphasis on the American side," Iwamura said in a March 12 interview. "Production and R&D, development facilities, those can be done by investing money. Localization of the people is one of the key issues."

Toyota Moves
Honda's revenue from sales of autos, motorcycles and power products in North America was 986.2 billion yen ($12.7 billion) in the quarter that ended Dec. 31, or 51 percent of its global total. While U.S. sales of Honda and Acura autos fell to 1.15 million units last year, which was still 38 percent of the company's worldwide volume.

Toyota, too, is giving more authority to North American executives, to improve development of products for the market and avoid a repeat of the 2009-10 recall crisis.

This month, Toyota promoted Jim Lentz to chief executive officer of its U.S. sales unit, the first time that job has gone to an American.

Asia's largest automaker last week said Steve St. Angelo, executive vice president for North American engineering and manufacturing, will oversee regional production as part of his duties on Toyota's North American management committee. Ray Tanguay, chairman of Toyota's Canadian unit, is responsible for North American quality issues. Lentz will oversee regional sales, marketing and product planning.

Honda's Revamping
Toyota President Akio Toyoda has said shifting more responsibility to local managers in North America is central to his goal of restoring customer satisfaction hurt by the recalls.

Honda's U.S. car and light truck sales slid 6.8 percent last year after natural disasters in Japan and Thailand curbed output of parts and vehicles. The company's redesigned Civic also flopped in tests by Consumer Reports, which recommended previous versions, a sign that the carmaker's ills extended beyond 2011's one-time events.

For decades, products created for the U.S. came from a "synergy effect" between Japanese and American engineers, Iwamura said. Now, American engineers making product decisions for U.S. customers is the best way to increase competitiveness, Iwamura said.

"That is one of the reasons we appointed Erik as the top man of R&D," he said. Berkman, who begins his new job April 1, was traveling in Japan and unavailable for an interview.

Honda's Targets
John Mendel, executive vice president of U.S. sales, is also joining Berkman on Honda's North American management board, as is Tom Shoupe, president of the company's Alabama plant.

Honda wants to rebound this year with a 24 percent U.S. sales gain. It has made some progress, boosting sales 11 percent in 2012's first two months, led by a 45 percent jump in Civic deliveries. The company plans to release a modified Civic later this year to address concerns raised by Consumer Reports, as well as a redesigned Accord.

The company's U.S., Canadian and Mexican plants may also set a production volume record, building about 1.8 million vehicles this year.

The automaker is completing more than $690 million of upgrades at U.S. plants and is also building an $800 million factory in Mexico to produce subcompact models such as the Fit.

In January, Honda said it planned to build its Acura NSX "supercar" in Ohio within about two years. The racing-style coupe will sell for more than $100,000. The site and cost of that project hasn't been announced.

Restoring Reputation
Restoring its reputation as an industry innovator, a legacy of founder Soichiro Honda, is a bigger challenge than boosting sales and production.

"It's not just the Koreans; everyone has gotten better," Keller said. "In terms of quality and features, it's a game of equals. It's just a lot harder for Toyota and Honda to stand out."

It may be years before Honda's changes in local management are effective, said Hall of 2953 Analytics.

"It's safe to say that if they keep going the way they were going, they were heading for a decline with other guys passing them and just doing better than they are," he said. In the U.S., "the question is whether they've caught their problems soon enough to not get passed by Hyundai-Kia."

Source;
http://www.detroitnews.com/article/20120325/AUTO0104/203250305/1148/auto01/Honda-promotes-American-managers-push-revive-U-S-market

Honda names former Chrysler exec to steer U.S. marketing

By Mark Rechtin, Crain News Service



LOS ANGELES (Aug. 19, 2011) — American Honda Motor Co. has chosen an outsider and former Chrysler executive Michael Accavitti as its chief marketing officer.



Mr. Accavitti most recently was executive automotive adviser for Cisco Systems, but is better known as the veteran Chrysler executive who was president of the Dodge brand and lead marketing executive of the Chrysler Group before his 2009 departure.



Mr. Accavitti replaces Steve Center, who will lead a new enterprise within American Honda called the Environmental Business Development Office.



Mr. Center has been in Honda’s top U.S. marketing post since June 2008.



Mr. Accavitti inherits an organization that’s battling production shortages stemming from the March 11 earthquake and tsunami in Japan. American Honda’s U.S. sales have declined 3 percent this year through July in a market that’s up 11 percent.



To retain U.S. customers until stockpiles are replenished, Honda has taken the unusual step of extending leases or offering vouchers or rebates toward the future purchase of a new Honda.



Honda has told its U.S. dealers car and light truck inventories are not expected to return to normal levels until the last quarter or early 2012.



New group

The new environmental group will oversee Honda’s various green business initiatives, from the Fit electric vehicle to solar panel arrays to home co-generation units fueled by natural gas.



“Honda is structured by distribution group, by auto brands, motorcycles, and power equipment.



But these futuristic energy creation groups are transcending those silos,” Mr. Center said in an interview.



With “the dynamics (of) the utility business, you can see that things are starting to break through all the distribution channels,” he added.



Mr. Accavitti first worked for Chrysler starting in 1977. He installed axles on trucks at Chrysler’s Warrren, Mich., truck plant—known as Dodge City—to save money for college. He worked on the line for two years and one summer before starting college.



He rejoined Chrysler in 1984 when the auto maker was hiring engineers and spent time in product marketing, brand management and racing.



At Honda, he will oversee the marketing of the Honda and Acura brands, public relations, auto shows and emerging-markets advertising.



The transition is occurring immediately, although it was announced internally on Aug. 1.

Mr. Accavitti is in the process of relocating to Los Angeles and was not immediately available for comment.



Fresh blood

“You need the fresh blood,” Mr. Center said about the changes. “Fresh thinking is good, but too much and you can lose your culture or focus.”



Last year, Honda extended voluntary retirement offers to certain employees and lost about 50 managers, many of whom had more than 30 years of experience at the company. Center said Honda is “still a very young company.”



Mr. Accavitti will have a full plate awaiting him as Honda strives to recover from the March earthquake.



Because of the earthquake-related inventory crunch that killed the momentum of the spring launch of the Civic, Honda will re-launch the compact car this fall. Also, a redesigned CR-V crossover arrives later this year, and a new Accord comes next spring. Those are three of Honda’s four “pillar” vehicles, Mr. Center said.



Honda brand sales are off 2 percent this year, and Acura sales are down 6 percent.



Like Mr. Center did, Mr. Accavitti will report to Tetsuo Iwamura, president of American Honda. Unlike other auto makers, Honda separates its auto operations—such as product development, product planning and marketing—from auto sales, which covers distribution, wholesale and retail and is overseen by executive vice president John Mendel.



Mr. Center, 54, joined Honda in 1993 as part of Dick Colliver’s team of transplants from Mazda North American Operations. Mr. Mendel was formerly executive vice president and chief operating officer for Mazda North America before joining Honda in 2004.



Mr. Center’s career has included managerial positions in market support, e-business, Acura sales, advertising and public relations.



The Environmental Business Development Office will receive additional staff, but Mr. Center declined to give further details.



He called it “a combination of a brain trust, think tank and venture capital firm.”



Source;

http://www.tirebusiness.com/subscriber/headlines2.phtml?cat=1204552929&headline=Honda+names+former+Chrysler+exec+to+steer+U.S.+marketing&id=1313763465

Honda Motor To Cut Number Of Directors To 12 From 20 - Update

(RTTNews) - Japanese automaker Honda Motor Co., Ltd. (HMC: News ) Tuesday stated that its board of directors has decided on a plan for changes in management and board structures. The plan includes reducing the number of directors to twelve from presently twenty.

The plan, which was decided at a board meeting held today, is intended to strengthen the company's management structure amid changes in the economic environment.

The planned changes are subject to shareholders' approval at the general meeting to be held in late June 2011 and a decision at the board meeting to be held immediately thereafter.

According to the company, in 2005, it had implemented an operating officer system to strengthen the execution of regional and on-site operations and to carry out appropriate management decisions. In that system, a structure was established to differentiate the roles between directors and operating officers.

Honda Motor today said it will designate all of the directors who have business execution roles, including the president, as operating officers. In conjunction with these changes, titles such as senior managing, managing, and the like will be attributed to officers within the operating officer system.

Further, the company will elect a member from the operating officers as a candidate for director.

This member will be responsible for deciding matters provided by law and for monitoring and supervising business execution, in order to speed-up and streamline board's decision making. This member will also respond to the requests of shareholders and investors.


As a consequence of these changes, the number of directors will change from twenty to twelve in late June this year. Meanwhile, the company will maintain the number of corporate auditors at five.

In addition, in order to align with the beginning of the business year, the time of assumption of office for operating officers will be changed to April 1. It was late June earlier.

HMC closed Friday's trading at $44.49, up $0.12, on a volume of 496,400 shares.

Source;
http://www.rttnews.com/Content/BreakingNews.aspx?Id=1558176&SM=1