Honda announced plans to combine all of its automobile manufacturing and product development facilities in the U.S. into one new company, in similar fashion to the consolidation announced in February in Japan.
The new entity will be called Honda Development & Manufacturing of America (HDMA) and will incorporate all the carmaker’s facilities related to frames, engines and transmissions, as well as related engineering and purchasing operations.
In addition, the new company will also integrate the automobile product development operations of Honda R&D Americas (HRA). The Japanese carmaker said the unification of its manufacturing operations and merger with auto product development will be effective April 1, 2021.
“Today, we are announcing a number of changes to our business operations that continue the journey we began last year, to become a more lean, nimble and unified company in North America,” said Shinji Aoyama, chief officer of North American Regional Operations of Honda Motor Co., Ltd., and president & CEO of American Honda. “Each change is vital to our ongoing effort to make Honda in America stronger and more responsive to the customer, better able to invest in advanced technology, and prepared to meet future market needs.”
Another consequence of this move will be the integration of automobile product design and certain market research functions currently part of the HRA Los Angeles Center into the Regional Operations of American Honda Motor Company based in Torrance, California.
According to Honda, the main goal with the consolidation of its U.S. auto creation activities is “achieving seamless development of new products with improved efficiency and quality, thus positioning its North American operations for the future”.
As a result of these changes, all auto development, planning, purchasing, strategy and manufacturing will be brought into one company. This will strengthen what Honda calls a “one-floor” approach to the product development process, with the carmaker listing three major advantages of this philosophy.
The first is the centralization of key business functions to become more efficient and eliminate redundancies. The second regards the execution of new product development with increased speed and accuracy, and the third is about improving manufacturing characteristics with a focus on quality, cost competitiveness and the ability to deliver vehicles that appeal to customers in a timely manner.