The CEO said Honda will slash the number of trim and option variations to a third of their current level by 2025 across its worldwide lineup.
How complicated has it gotten for Honda? Consider the Civic Touring sedan.
That model has three choices of 18-inch alloy wheels, then three choices of wheel decals: blue, green or red. Inside, customers have their pick from four interior panel trims: black, blue, green or red. Top that off with four options for cabin illumination.
Reducing choices is just one of a string of overhauls Honda announced in a strategy shakeup as it races to rein in costs, streamline its manufacturing and free up r&d resources to compete in new segments and technologies.
Despite its big presence in the U.S., Honda is a midsize player on the global field. Like its rivals, Honda hopes to maximize resources to invest in next-generation technologies covering everything from electrification to autonomous driving.
"As we were growing in the U.S., our variants have also increased, which has worsened our efficiency," Hachigo said at a press conference last week where Honda announced a 13 percent decline in parent-company operating profit for the fiscal year ending March 31.
"The number of models for production and the processes involved in development will be streamlined," he declared. "Therefore, we can get resources for future technology development."
Other key elements of Hachigo's new strategy:
- Consolidate some models that are unique to certain markets into models that can be shared in other markets.
- Boost global factory utilization to 100 percent by 2022, up from 90 percent last year.
- Cut global production costs 10 percent by 2025, compared with 2018 levels.
- Debut a new vehicle architecture next year that bolsters component commonization.
- Reduce by 30 percent the number of employee hours required to develop production vehicles.
In showrooms, the immediate upshot will be less complexity in customizing cars. Hachigo said he has no intention of eliminating nameplates, just the number of trim options. He said Honda does not expect to lose sales by narrowing the array.
"Compared with other manufacturers, Honda tends to have a higher number of variants," Hachigo said. "We want to focus on the variations that are really needed by consumers. In the end, everyone agreed we have too many variants. "
He cited control panel color combinations as one target in Honda's push to simplify, which will affect its five global nameplates: the Civic, Accord, Fit, CR-V and HR-V.