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Section: BHONDA (A)Case SnapshotTag Line

Presence in International Markets

Porters 5 ForcesCompetitive Rivalry-HIGHMany established players - strong hold & loyal customer base

Market shares in USAHONDA40-50%YAMAHA15-25%KAWASAKI10-15%SUZUKI9-12%SOTWResearch and Development Dealer and Distribution NetworkExpansion Huge Advertisement BudgetIntegrated ProducerStrengthCost Reduction PolicyNo unit cost performance data Catering to Middle ClassEnvironmental pollution Operating Lossess WeaknessFierce CompetitionMarket StagnationOil and Commodity PricesAppreciating Yen against DollarOther utilizing cost effective ways of production ThreatsHybrid Motor CycleStrategic Alliance Aging PopulationSocial Media PresenceEnvironmental friendly vehiclesOpportunitiesInternal Factor Evaluation (IFE) MatrixStrengthsWeights RatesWeighted ScoreHonda is a fully integrated producer of engines, frames, chains, sprockets and other ancillary parts crucial to motor cycle performance.

Honda has product advantage through heavy commitment to R&D and advanced manufacturing capabilities.

Honda has strong dealer and distribution network.

Honda has expanded its production facilities in different parts of the world.

Honda has substantial amount of budget which is solely dedicated to advertisement and marketing. 0.05

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10.25Internal Factor Evaluation (IFE) MatrixWeaknessesHonda has cost reduction policy. Over time if they dont control this then Honda may not be able to develop profit margins good in comparison to its competitors. Honda does not have unit cost performance data of its competitors thats why it is difficult for them to analyze their performance in terms of its competitors. Honda is catering to only middle class segment of the society whether it is USA or any other market. Since Honda continuously comes up with new motor cycle. Some of its models have generated low sales volume which has contributed to the huge operating expense to the company. Motor cycles are polluting the environment thats consumers have high environmental concerns. 0.050.030.050.050.07312120.150.030.10.050.14Total13.97External Factor Evaluation (EFE) MatrixOpportunitiesWeights Rates Weighted ScoreHonda can develop hybrid motor cycles which are fuel efficient.

2. Can do strategic alliance and joint venture in order to grow its market.

3. People above age sixty makes up over 50 million people in the USA and represent almost 40% of all vehicle buyers.

4. Enhance social media presence

5. Investment in environmentally friendly vehicles and research and development solely dedicated to environmental sustainability. 0.1

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0.3ThreatsFierce competition by Japanese and US motorcycle producers

Middle class consumers have preference towards buying cars.

Oil and commodity prices are increasing

Appreciating Japanese Yen against the USA dollar.

Regaining the lead of low emissions is a risky proposition as other companies are coming out with new and cost effective ideas of producing low emission vehicles.0.15

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0.15Total12.75RECOMMENDATIONSThey should reposition their brand image

Cost has to be controlled.

Strategic Alliance with American Players

Production of Hybrid Motor Cycles

Environmental Safety and Concerns