Japanese car maker Honda is hoping to return to its former glory under the guidance of a new global boss, Toshihiro Mibe, who has an engineering background and is the former head of the company’s flagship research and development division.
According to industry analysts, the appointment of Mr Mibe is intended to return Honda to better times after being accused of cutting corners and cutting costs for the past decade.
An insight into Honda’s gradual decline: the Japanese brand ranked 27th in the most recent vehicle quality survey published by JD Power in the US, after dropping to 18th the year before.
The appointment of Mr Mibe “restores the car maker's focus on technology and (motor vehicles) at a critical time for the middle-size player,” reported respected industry journal Automotive News.
“Selecting the veteran powertrain engineer steers Japan’s Number Three (vehicle manufacturer) back to its long tradition of promoting its global R&D boss to the head of the whole company,” the media outlet reported.
When Honda appointed its current CEO Takahiro Hachigo in 2015 it broke with tradition, promoting an executive who hadn’t led the company’s engineering arm.
“By contrast,” Automotive News reported, “Mibe has been a top executive at Honda R&D since 2016 and was appointed its head in 2019. He has a front-row seat to the vexing issues Honda must tackle in an industry under siege by electrification, connectivity and autonomous driving.”
Analysts say Mr Mibe, 59, needs to fast-track Honda's electric and autonomous vehicles – while at the same time trying to dramatically improve profit.
Automotive News reported the profit margin at Honda's automobile business was just 0.8 per cent for the last nine months of last year, down from 2.9 per cent the prior year.
Cars have only accounted for only 18 per cent of Honda's total profit so far this Japanese financial year, whereas motorcycles represented 52 per cent of the brand’s profit – with a healthy 12.1 profit margin, Automotive News reported.
Last September, Honda and GM announced a deepening of their partnership to include a range of vehicle platforms, engines, materials, purchasing and manufacturing.
In Australia, Honda sales fell by 33.8 per cent last year in a market that declined by 13.7 per cent compared to 2019.
From July 2021, Honda will reduce the number of dealers who represent its brand in Australia – and will switch to non-negotiable fixed-pricing across its local model range.
MORE: Everything Honda