By on July 7, 2015

Photo courtesy Honda

New Honda CEO Takahiro Hachigo told media Monday that the automaker wouldn’t aim for a specific global sales figure to drive growth and would be open to partnerships with other automakers, Automotive News reported.

The speech also emphasized sharing global manufacturing resources within Honda’s six regional divisions and to create “challenging products.” (Which may or may not — probably not — mean “Challenger.”)

The speech was Hachigo’s first public address since taking the reins of Honda last month. In a sustainability report released in June, Hachigo signaled that the Japanese automaker would adopt English as its official language by 2020.

The news yesterday is particularly interesting as speculation ramps up around FCA and Sergio Marchionne’s plan for consolidation with General Motors. Any alliance with Honda could help FCA gain a sales foothold in Japan and could revitalize FCA’s hybrid program. In turn, Honda could capitalize on FCA’s European market share and network.

In the speech, Hachigo outlined several different initiatives Honda will undertake in the next few years, which include building a smaller, turbocharged Civic and other production efficiencies. For example, the CR-V, which is produced in Canada, will be exported worldwide. Civics produced in England will be shipped to Japan, and Japanese-built Fits will be sent to the U.S. In addition to those announcements, Hachigo said Honda will begin building Accords in Nigeria for African markets. More than 80 percent of Honda’s car building is outside Japan.

Get the latest TTAC e-Newsletter!

Recommended

61 Comments on “With New Honda CEO, Possible FCA Partnership?...”


  • avatar
    thornmark

    Although I have great fondness for Chrysler, Dodge and RAM, FIAT is crap.

    Honda, avoid FIAT like the plague.

    • 0 avatar
      Buckshot

      What´s wrong with Fiat?

      • 0 avatar
        mmreeses

        ***What´s wrong with Fiat?***

        as long as partnership isn’t the first step to marriage.

        imagine Toyota bought old GM in January 2008 and then started move a big chunk of production to Mexico for the sake of cost cutting.

        Now replace Toyota with Honda, GM with Fiat and Poland with Italy.

        • 0 avatar
          Buckshot

          Is Fiat cars problematic in the us?

          • 0 avatar
            heavy handle

            Short answer: no.

            Long answer: some people like to play a game where they compare 1970s’ Fiats with today’s non-Fiats. Probably because 1975 was the last time they had a full head of hair.
            It’s something that they do. It’s mostly harmless, and it keeps them happy.

          • 0 avatar
            CJinSD

            There’s no truth to what you just said, heavy handle. Buckshot asked a question and you took advantage of the opportunity to lie before the truth could take hold. New Fiats are some of the worst cars you can buy in the US in terms of quality, and they have poor resale value. Check all the relevant indexes.

          • 0 avatar
            heavy handle

            CJ, you forgot to scroll-up a little higher. Thornmark made a statement that was inflammatory, and frankly quite trite, then buckshot asked for clarification.

            All I did was call a spade a spade, and tell him where those statements come from.

            As far as resale goes, I don’t know about SD, but prices seem to be holding-up in my area. Reported reliability issues (on this site, and first-hand from techs) are limited to trim and entertainment. I’ll bet you 90% of that is due to the Microsoft entertainment system on the original 500.

            Even the anecdotal stuff doesn’t line-up with your claims. Most brand forums are littered with reliability complaints, but the American Fiat forums aren’t. It’s actually kind of weird.

          • 0 avatar
            CJinSD

            http://www.jdpower.com/press-releases/2015-vehicle-dependability-study

            Scroll down; you’ll get to Fiat at the bottom. If finishing a DISTANT dead last in the JD Power dependability study doesn’t trump anecdotal evidence, my uncle’s Abarth was totaled by the dealer while replacing the clutch on a car that was only about a year old. Sure, dealer incompetence is nothing new when the place probably was a Daimler-Chrysler outlet, but they shouldn’t have been cutting the body structure to replace a clutch in a year old car because they shouldn’t have had to replace a clutch after a year. My uncle’s previous cars had all been sticks too, so I doubt it was user error.

            Recently I’ve seen brand new Abarths for prices that wouldn’t buy a decently equipped Sonic. Or how about $10K for a new 500 Pop? People pay more for Mitsubishi Mirages.

            http://www.cars.com/for-sale/searchresults.action?feedSegId=28705&rpp=50&requestorTrackingInfo=RTB_SEARCH&stkTypId=28880&PMmt=1-1-0&zc=92109&rd=99999&mdId=20483&mkId=20060&prMn=0&prMx=20000&searchSource=SORT_NEW&crSrtFlds=stkTypId-feedSegId-mkId-mdId-pseudoPrice&pgId=2102&sf1Nm=price&sf1Dir=ASC&sf2Nm=location&sf2Dir=ASC

          • 0 avatar
            heavy handle

            CJ,

            Those are awesome deals if you drive stick. I wonder how high the transaction fees are.

            A good buddy just passed the 100K mark on his 500 (50 mile commute each way). His only maintenance costs were oil and tires.

            I’ve already mentioned JD Power. Note the first sentence in your link: “Bluetooth connectivity and voice recognition issues are the most frequently reported problems after three years of ownership.” That hardly sounds like a plague.

            Too bad about your uncle’s botched clutch job. There’s a way to do that job without writing-off the car, as you surely realize.

      • 0 avatar
        Lorenzo

        The problem with the Fiat part of FCA is what another website refers to as the “espresso-swilling minions” of Sergio. That’s the traditional management of Fiat, a corporate culture that shouldn’t have survived the modern era. Under that management, no new feature, no new model, can be counted on until you see it rolling off the assembly line.

        It’s a seat-of-the-pants management style that only worked when there was an Agnelli in charge to bark orders and get things finally settled, and Sergio is no Agnelli. Sergio has been able to keep that part of Fiat alive for far too long, despite the missed deadlines, half-finished engineering and sloppy fit and finish.

        You just can’t get away with that kind of industrial management culture anymore, and it’s probably the biggest reason, after the debt load, that Sergio is unable to find a partner. If Honda has it’s mojo back, they surely wouldn’t want to deal with that. The clash of Fiat’s management culture with GM’s own dysfunctional culture would be a whole ‘nother trainwreck.

    • 0 avatar
      Luke42

      @thornmark:

      If that’s your concern, then a Civic in Fiat’s clothing would likely fix the problems you see.

      And FCA could save that $5BN that they want to spend on the Giulia on everything else, by using Accord bones. See like a win.

      If Honda can help the rest of FCAs platforms with reliability in exchange for economies of scale, I Gould see it working. Assuming, of course, that most people at most levels of both companies want it to work – alliances and mergers can be derailed by something as simple as a personality conflict at the wrong place…

      • 0 avatar
        Pch101

        The problem is with deal structure. Honda doesn’t want to be devoured (nor does it need to be), while FCA doesn’t want to write checks for cars produced by someone else. FCA wants a no-money-down deal, and that won’t happen with Honda.

        In any case, FCA’s greatest concerns are with market share in Europe, and Honda is of absolutely no help to it there.

        FCA’s best hopes would be some sort of marriage with PSA or, if it could swing it, Opel-Vauxhall. And the latter isn’t likely to happen.

        • 0 avatar
          MBella

          I think Honda could help in Europe if the deal was done right. If Honda let them use their platforms and drive-trains, and let FIAT do the styling, they probably would sell well in Europe. Sergio would have to find a way to make it worth it for Honda, and that might be more difficult.

    • 0 avatar
      jimmyy

      Actually, Chrysler, Dodge, Ram, and Fiat is crap. Have you seen their bottom of the barrel reliability in Consumer Reports? Honda, run. Fast.

  • avatar
    Pch101

    Given what Honda is, I would expect that a “partnership” would be largely comprised of Honda outsourcing its services to others, particularly engine development.

    • 0 avatar
      thornmark

      I doubt Honda would outsource engine development to another company considering that Honda is the largest producer of ICE’s extant and is considered to be among the best in that area.

    • 0 avatar
      slavuta

      I don’t know what they going to do there… today I don’t buy Honda because of their packaging system (LX, EX…) But if they join FCA, I will not even look their way. I like well-built, reliable cars. FCA can’t describe itself building these.

  • avatar
    RideHeight

    And J.K. Rowling will coauthor a series of novels with E.L. James.

  • avatar
    indi500fan

    Hachigo-san:

    Consider the fate of GM when they had to pay palimony to sever relations with Fiat.

  • avatar
    CoreyDL

    Look look!

    http://news.yahoo.com/japan-not-prosecuting-american-toyota-exec-drug-case-133459309.html

    Who had called it that the Japanese justice system doesn’t prosecute without guaranteed conviction in advance? I can’t recall who it was.

    “However, prosecutors in Tokyo decided they would not pursue an indictment given the relatively minor nature of the crime, Japan’s top-selling Yomiuri newspaper reported, citing unnamed sources.”

    • 0 avatar
      Pch101

      I can’t see how that’s possible, when TTAC’s right-wing commentariat had already tried and convicted her online.

      • 0 avatar
        CoreyDL

        I was one of the people on the “this could be conspiracy” side of this thing.

        It’s interesting to me, all of that being said, that she was -not- trying to break any law and yet still imported it via mail (illegal) without prescription (illegal) and hid the pills amongst accessories, labeling the package “necklaces” (illegal).

        That’s a lot of serious “mistakes” to make, for someone who didn’t know what they were doing.

        • 0 avatar
          Pch101

          I don’t see a conspiracy. Judging from the media reports, the case was weak if one is using something that resembles a reasonable doubt standard.

    • 0 avatar
      RideHeight

      This is why I want Corey to anchor TTAC’s East Asian bureau.

  • avatar
    87 Morgan

    Honda for the most part makes great engines and transmissions, save the glass ones from the early 00’s. It is not like Chrysler can lob any stones at a minivan that eats trannies.

    The Honda small car platform is what Marchionne needs and I am sure that Honda would not mind gaining some revenue by licensing said platforms and or participating in their manufacture.

  • avatar
    dal20402

    I’m sure Sergio gets a bit breathless when he thinks about what Honda could do for him. Having access to Honda powertrain tech would solve his biggest problems overnight.

    I’m also sure that FCA would be just about the very last automaker Honda would partner with, unless such “partnership” is in reality just a big transfer of cash into Honda’s coffers.

    • 0 avatar
      Pch101

      Marchionne wants to get married, i.e. FCA uses some sort of LBO to get platforms and drivetrains. Not much interest in casual dating, particularly when it would involve FCA writing checks. (I am presuming that Honda would want to be paid for its motors and is not interested in dilution.)

  • avatar
    Veee8

    Hellcat Pilot, has a certain ring to it – or perhaps an EarthDream engined Challenger, hmmm…

  • avatar
    Tstag

    So Honda gets a new Rover in Fiat?

  • avatar
    70Cougar

    Sign me up for a four door hatch or wagon that looks like an Alfa and is built like a Honda. Manual, but not brown or diesel.

  • avatar
    danio3834

    Both Honda and FCA are in similar situations being the smallest of their respective “Big 3s”. Being that both have a good amount of value to offer each other in the form of filling in product weaknesses and have strengths in different markets, this hypothetical merger makes a ton more sense than the GM talk.

    • 0 avatar
      Pch101

      I don’t see Honda getting anything from FCA unless FCA wants to buy engines (which I doubt that it does.)

      Honda is already highly efficient, doing as much platform sharing as is humanly possible. Trying to use other automakers’ platforms would probably add to inefficiency rather than improve it.

      At the same time, Honda does not seem culturally inclined to move seriously into anything that involves much use of anything with more than six cylinders.

      At most, I can see a repeat of something similar to what was done with Rover and the Honda Legend, where Honda essentially developed the car and Rover modified Honda’s work. (One can only hope that the next car company doesn’t botch things up as Rover did.) Or it could be similar to what was done with GM, with Honda making engines for certain models.

      • 0 avatar
        danio3834

        Honda has very little exposure to trucks, SUVs and commercial, areas where FCA has strength. It would be very difficult for Honda to break into these more profitable markets without a partner. They are right to be risk averse to those markets on their own. The average transaction prices of the vehicles of the two companies are fairly far apart.

        • 0 avatar
          CoreyDL

          I think they should have entered the real truck market years ago, like when Toyota was selling the T100 before Tacoma and Nissan no larger offering either. I guess their management was a bit too closed-minded to consider it? They just have no interest in V8 engines?

          They could’ve called it the Terrain, that sounds nice.

          • 0 avatar
            danio3834

            Honda is traditionally a conservative and risk averse company when it comes to cars. V8 pickup trucks are mostly a North American phenomenon, and that market is fiercely brand loyal. The cost of acquiring customers in that market is very high, so they chose not to jump in with both feet like Nissan and Toyota. Toyota has struggled to move the Tundra up to projections and the Titan, well, it has’t worked out so far.

          • 0 avatar
            MBella

            There were rumblings last decade that a V8 was in development, but they stopped it when the crash happened in 2008. Now that engines everywhere are going smaller, I don’t think it’s very necessary for them.

        • 0 avatar
          Pch101

          I doubt that Honda has any interest in full-size trucks.

          The Honda Ridgeline tells you a lot about how Honda looks at these things. It’s a platform extension exercise that utilizes as many existing resources as possible, not a serious effort to grab market share by competing head-on against the leaders.

          • 0 avatar
            clivesl

            But do you think they sell the Honda faithful 25000 copies of a mildly reskinned RAM 1500?

            And could they do that profitably?

          • 0 avatar
            danio3834

            “I doubt that Honda has any interest in full-size trucks.”

            I’m not sure why they wouldn’t be when there’s money to be made. So far the potential for loss of heavy investment in that area has stopped them, a partner could alleviate much of that risk.

          • 0 avatar
            Pch101

            At its core, Honda is a maker of small engines. A full-size truck is a bad fit culturally.

            In any case, Honda’s greatest vulnerabilities are not in the US. I suspect that the new guy is more worried about other markets such as Europe, where Honda lags and has excess capacity.

        • 0 avatar
          dal20402

          I could see a Honda-FCA tie-up making sense only if FCA is so desperate that it’s willing to throw a LOT of value out the window. Honda competes, and is just superior, in a big chunk of FCA’s business.

          Fiat: Can survive as a boutique brand of Italian “charm” cars and commercial trucks, but will lose most of its products and volume (or, in Italy, sell rebadged Hondas).

          Alfa Romeo: If it’s really going to try to survive as an RWD BMW-style brand, then maybe there’s a place for it, with lightweight RWD chassis powered by Italian-tuned Honda engines. As operated in the last decade or so, it’s totally redundant.

          Chrysler: The only thing worth keeping is the 300, which should probably be merged with the Dodge Charger into one premium full-sizer anyway.

          Dodge: Honda can’t do Challenger or Charger. Viper is on borrowed time. Everything else is superfluous and dies.

          Jeep: KEEP ALL THE JEEPS, except the Compass (and turn the Durango into a 3-row “JGC L,” which would quadruple sales overnight).

          Ram: Keep the pickups and the bigger Eurovans. Everything else is superfluous and dies.

          I’m sure in this scenario that Ferrari would be spun off.

    • 0 avatar
      Lou_BC

      We tend to see Honda as a small car company but as a company in general Honda also builds robotics, jets, engines, motorcycles, outboard boat motors and multiple other power products.

      I’m sure Honda would be FCA’s wet dream more so than GM. I doubt that conservative anal retentive Asian business culture would be a good match for FCA.
      Which corporate culture would prevail?

  • avatar
    Polishdon

    Well,

    It would give Acura an avenue to produce a true luxury car (i.e. RWD). And would strengthen FCA.

    Question is……

    Are we talking merger or just platform, etc sharing ?

    • 0 avatar
      clivesl

      In a perfect world FCA would handle luxury, trucks and RWD. Honda would build the rest. I’d shop at that store.

    • 0 avatar
      dantes_inferno

      Honda: Why did you go to the Congress, why didn’t you come to me first?

      FCA: I didn’t want to get into trouble…

      Honda: I understand. You found paradise in America, learned a good trade, made a good living, you have politicians protecting you, and you have courts of law. You didn’t need a friend like me. But now you come to me and say “Honda, make me a partner”. But you don’t ask with respect. You don’t offer friendship. You don’t even think to call me GodHonda. You just come to me on this day and ask me to commit merger, for money.

      FCA: I ask for justice.

      Honda: That is not justice. Your company is still alive.

      FCA: Then make the competition suffer, as I suffer. How much shall I pay you?

      Honda: FCA, FCA. What have I ever done to you to treat me so disrespectfully? If you had come to me in friendship, then the competition who almost ruined your company would be suffering this very day. And if by chance an honest company such as yourself should make enemies…then they would become MY enemies. And then they would fear you.

      FCA: Be my friend, GodHonda… (kisses Honda’s hand)…

      Honda: Good. Now there will come a day, and that day may never come, that I may call upon you to perform some styling for me. But until that day, accept this partnership as justice on this day…

  • avatar
    Speed3

    I actually think an FCA tie-up with Honda would be great. Obviously there is much more for FCA to gain than Honda, and Honda is very risk-averse so this would not likely happen. But…can you imagine FCA products with Honda build quality? Quality concerns aside, FCA’s biggest hole is a solid mainline brand like Ford or Toyota.

    This is how I see it: Honda and FCA merge. Synergies are developed – shared engines, parts, platforms, etc. Fiat is relegated to developing-world cheap car status (they are basically that anyway in much of the world). Chrysler is discontinued. Dodge is paired down to a boutique brand (Charger – Challenger – Viper).

    You now have a company that has all its bases covered: Global brands: Honda, Acura, Jeep, Alfa Romeo, Maserati, Ferrari. Possible global brand: Dodge (American muscle/sports car brand), Fiat (either cheap developing car brand or small cute car boutique brand) Non global brand: Ram, Fiat Professional.

    No overlap and a solid company to rival VW.

    • 0 avatar
      CJinSD

      Can you imagine Mercedes-Benz cars with Chrysler-Jeep quality? Because it happened.

    • 0 avatar
      Polishdon

      Not too bad, only things I would change are:

      Keeping the Chrysler minivan. It is being replaced, but it is so well entrenched (hey, they created the minivan), it would probably be a mistake to kill off.

      I’d kill Acura & Alfa Romeo. It doesn’t compete with Lexus, etc. Or at least merge them and move Acura upmarket

    • 0 avatar
      CoreyDL

      I don’t see FCA having anything besides Jeep that Honda would want, since they aren’t interested really in the truck market or big engines.

      If they wanted to do trucks here, they’d probably do a tie up with Isuzu, or Suzuki, or Mitsu – someone else Japanese. Hell, I can see them working with a Korean firm before doing something with FCA.

      Overall, I feel this Honda-FCA discussion is rather moot and silly. Honda is risk averse as mentioned before, and FCA is a huge risk from all directions at this point in time.

  • avatar
    SCE to AUX

    Honda could replace its weak V6 transmissions with FCA’s balky 9-speed. Or maybe not.

  • avatar
    PentastarPride

    Hopefully, one of these days a billionaire investor from the US–who just so happens to love Mopar–buys the Chrysler division from FCA and brings it back to America.

    If I were in the position to buy out Chrysler from FCA, I would. Then I’d immediately get some engineers together to revive the cab-forward LH platform. RAM would be Dodge Ram.

  • avatar
    hiptech

    To my way of thinking a much better synergy for Honda isn’t FCA but Mazda!

    Think about it, Mazda that scrappy little company offers excellent design, innovative engineering and outstanding handling is hanging on by their fingernails.

    An allegiance with Honda is the perfect (forgive the pun) fit. Imagine Honda drivetrains and supplier resources combined with Mazda style and handling.

    Combining their engineering talents could make for some interesting vehicles…

  • avatar
    kuman

    well… bleak prospect for honda perhaps, or they are really that desperate to fend of the complaints about how they car looks ( not how they perform ) and thinks perhaps some Italian know how in car styling would help them…

    On the upside and perhaps its a wishful thinking, we can finally have an alfa romeo with honda reliability

    sort of italian exotic looks with japanese temprament


Back to TopLeave a Reply

You must be logged in to post a comment.

Recent Comments

  • Lie2me: $30K is loaded Renegade Trailhawk 4X4 177hp turbo money, I’m not feeling this Kona
  • Art Vandelay: “But we would at least like to have the opportunity not to buy it.” I can say 100 percent,...
  • SCE to AUX: As long as mfrs hedge their bets by not going all in on EVs, they are effectively planning to fail in the...
  • brettc: Sounds like he didn’t say yes to everything in the F&I office… But more seriously, wow. This...
  • sportyaccordy: Unless you were flooring it all the time, I doubt a smaller motor would have helped.

New Car Research

Get a Free Dealer Quote

Staff

  • Contributors

  • Timothy Cain, Canada
  • Matthew Guy, Canada
  • Ronnie Schreiber, United States
  • Bozi Tatarevic, United States
  • Chris Tonn, United States
  • Corey Lewis, United States
  • Mark Baruth, United States
  • Moderators

  • Adam Tonge, United States
  • Corey Lewis, United States