Engineers at Honda will soon spearhead the company’s research and development, rather than following directions from company management.
According to business news outlet Nikkei Asia, Honda will spin off its R&D department in an effort to reignite innovation from within the Japanese car company.
In 1960, the R&D unit was originally designed as a separate arm of Honda (from the idea that creativity and innovation are best developed in an independent environment) – an idea championed by founder Soichiro Honda.
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However, the subsidiary was then absorbed back into Honda in 2020 due to financial constraints.
I had a good idea, either for the lead of headquarters or six years ago to be “Five or 6 years earlier”. The world has changed a lot,’ Honda executive told Nikkei.
This move is said to be a response to the large competition that has been developing in China’s automotive industry, and it will reinstate Honda R&D as its own business unit.
The Chinese car companies can build a new model in less than two years, including innovations in production and lower manufacturing costs about half the time it takes for Japanese automakers to make.
The Honda executive said ‘If we restore the research institute, there is no guarantee that we can beat China’ but reiterated it was not about the company to “raise the white flag”.
Honda has been sagging in the Chinese market for recent years as its position in Japan is under pressure from . Honda sold about 1.1 at its peak in 2020, when it was around s for the first time. There were 6 million cars there, but this dropped to 640,000 last year despite a series of products designed for China including electric vehicles (EVs) and other Chinese-based goods. Honda has production capacity of about 1-1 in China, Nikkei says. has a factory use rate of about 50-60 per cent, with 2 million units.
Last month, Honda announced it was abandoning plans to produce electric cars with Sony under the Afeela brand – four years after the joint venture was announced. It came just days after Honda confirmed it was axing a range of its own future electric models, shortly before they were due to enter production.
Earlier, Honda has also announced plans to develop electric vehicles and hydrogen fuel-cell technology with General Motors before ditching those plans and announcing the same deal with Mitsubishi on cheap battery-powered cars.
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