25 YEARS OF HONDA IN THE U.S.A.: New methods made waves, then won respect
Honda's decision to make cars in U.S. factories with U.S. workers was unpopular among a group that might have been expected to support it: Honda's U.S. dealers.
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Some dealers "complained that the anticipated inferior quality of workmanship at the new (Ohio) plant would ruin their businesses," wrote Robert Shook in his history of the company, Honda: An American Success Story.
Indeed, Honda has shown a knack for attracting controversy since it began a quarter-century ago to build products in the United States.
Rick Case has sold Honda motorcycles since 1965 and Honda cars since 1972, when he opened a dealership in Akron, Ohio. He confirms that a fear of shoddy products was common among dealers before Honda first built cars in the United States in 1982. He also says he did not share that apprehension.
"I promoted the fact that they were made in Ohio," Case says.
Honda always has assembled vehicles in the United States with nonunion labor. Until 1996, it built vehicles with too little content from U.S. suppliers for federal rules to count them as American-made.
These facts have contributed to the notion that Honda hasn't always fit in well as a naturalized corporate U.S. citizen.
'A great relationship'
Case insists he did not worry about the quality of Ohio-built Hondas. He says he was eager to sell the made-in-America angle to his Ohio customers. Many of them were anxious about factory closings and job losses in the nation's industrial heartland.
Case has become a top Honda and Acura dealer in Ohio and Florida. He also has Hyundai, Mazda and Mitsubishi franchises in several states. He built that empire on the foundation of early motorcycle sales and a single, once-struggling Honda dealership in Ohio.
"I've had a great, great relationship with" Honda, Case says. His wife, Rita, also is a Honda dealer and is the daughter of Honda's first U.S. franchisee, Bill Manly.
But not everyone feels such kinship. Supporters of organized labor remain annoyed that Honda America Manufacturing Inc. has repelled UAW attempts to organize Honda factories.
Joe Teague, an assembly line worker at the Marysville plant, has taken part in the effort to organize it. Teague, 33, says he doesn't object to the wage level at the plant. In fact, he considers it "a blessing."
But Teague, a nine-year Honda employee, says he is concerned about health and safety issues and what he calls the company's exploitation of temporary employees. He says coworkers are afraid to speak up for their rights.
"They are scared," Teague says. "There's been a lot of negative propaganda" from the company about the union, he asserts.
Ed Cohen, vice president for government and industry relations of Honda Motor America Inc., says the automaker's nonunion status should not trouble people with progressive principles.
"If Honda were not a good employer, it would bother me," Cohen says. But he contends Honda provides good pay and benefits, and has never laid off an employee in the United States. Such practices reflect union goals, he adds.
Another view
 When Rick Case, right, opened Rick Case Honda in Cleveland in 1973, he got a visit from Honda founder Soichiro Honda. |
A 1993 study by the Economic Policy Institute, a pro-labor think tank in Washington, concluded: "Because transplant vehicles displace domestic vehicles at a very high rate, and because transplants use proportionally more imported parts, transplant production destroys more jobs than it creates."
Such production does not improve the automotive trade balance, the report said. It noted that many of the parts Japanese automakers bought in the United States came from Japanese suppliers that had opened facilities near transplant factories.
The study added that transplants increased pressure on U.S. automakers to continue "closing plants, reducing work forces, cutting back on health and pension benefits, and resorting to low-wage, nonunion suppliers" (including offshore sourcing).
Other researchers from the period said Honda and other Japanese car companies boosted the U.S. auto industry. They encourage the use of better production methods, more sophisticated technology and more highly trained, more highly motivated workers, the analysts concluded.
Honda America Manufacturing and its related companies sometimes have appeared unsure of how "American" they want to be.
The Honda way
The automaker took a low-key approach to its 1987 acquisition of Ohio State University's Transportation Research Center, which adjoins Honda's Marysville property in central Ohio. The purchase came at a time when many Americans expressed concern about foreigners buying up the nation's assets.
The purchase effectively made Honda a landlord to the federal government's auto industry regulators, the National Highway Traffic Safety Administration. NHTSA conducts testing and research on the site.
NHTSA spokesman Rae Tyson says he has heard no complaints about the relationship.
"We were delighted to be able to stay there," Tyson says. "It has served us well. It's a fabulous research center."
Then there is the matter of Honda's relations with other automakers in Washington, D.C. In the early 1990s, the Big 3 invited Honda to leave the Motor Vehicle Manufacturers Association, then the industry's main lobby. They sought to create a more nationalistic American Automobile Manufacturers Association.
By the end of the decade, the pendulum had swung back and the Big 3 wanted to form a more inclusive association with import-brand companies. Honda chose to stay out of the new Alliance of Automobile Manufacturers. It remains a member of the Association of International Automobile Manufacturers.
Cohen says Honda's decision reflected the independent streak of its founder, Soichiro Honda. The attitude, he adds, still "permeates" the automaker.
