AD #1557 – Honda’s CEO Under Fire, OEM Ranks By Employment, Strikes Disrupting Production

February 16th, 2015 at 12:06pm

Runtime: 7:13

- Honda’s CEO Under Fire
- Is Apple Developing the iCAR?
- Hyundai Jumps Into CV Segment In U.S.
- Strikes Disrupting Production
- Mazda’s Diesel Woes
- Car OEM Ranks By Employment

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15 Comments to “AD #1557 – Honda’s CEO Under Fire, OEM Ranks By Employment, Strikes Disrupting Production”

  1. Mike Says:

    The MBA’s are also against Vertical Integration. It is easy to see why. If the accounting is set up so that all operations, other than the final sales event, are set up to make 5% return, then it makes no sense to make cars at all. The profits are shown at the sale and with the money made from selling the loan. Penske had it right; Sell me the Saturn Name and distribution and I’ll just buy the cars wherever they make them the cheapest.

  2. Chuck Grenci Says:

    On the story about “OEM RANKS BY EMPLOYMENT”: Would the numbers mean anything more if they were broken down by employees per vehicle (rather than just total employees)?

  3. Bradley Says:

    Honda CEO appears to be making sound decisions, so what am I missing? It sounds like he is managing a car opposed to a cash machine (this is a good thing).

    Mazda and Honda do not sell Diesels anywhere?

  4. J Hundertmark Says:

    Regarding vertical integration – Adds to higher profit margins if run in a positive manner. GM was very vertically integrated in the old days (60′s, 70′s) & demonstrated a very high profit margin at the time. The component divisions were set up to run very high volume of minimal designs & were not very flexible. As the industry changed to increased model diversity, they were not in a good position. Appears GM took the approach of spinning off the component divisions (Delphi) as opposed to updating them under GM control.

  5. Mike Says:

    #4 And yes, Ford created Visteon as a holder of their capital depleted parts making operations. For the margins available, it just didn’t make sense to re-invest in the parts making operations. Price fixing and manipulation on the part of a number of Japanese companies made it look like parts were available “for free” in terms of investment at prices that were less than the fully costed internal number. Detroit may be “back”, but the true total economic impact is much less than it used to be when they were more vertically integrated.

  6. HtG Says:


    Going far afield, when comparing GM and Apple’s cash piles keep in mind that lots of Apple’s money is held abroad for tax avoidance purposes, and that they did indeed face pressure from Karl Icahn and others to give some of the cash back to investors. Apple also had a near death experience earlier in its history under Jobs’s first period where its cash hoard was key to staying afloat.

    As far as Apples’ car plan, remember what Jen Sun Huang said a few years ago about cars, they are the ultimate mobility device. You guys see that oculus campus Apple is building? The car is going to be a part of a much larger interacting world mediated by sensors and datacenters.

  7. pedro fernandez Says:

    This outsourcing does not bode well for companies like Toyota and Honda that have built a reputation for quality and reliability. Just look at all the crappy parts coming out of China.

  8. Kit Gerhart Says:

    3 Mazda and Honda sell diesels about everywhere in the world except the U.S.

  9. Mike Says:

    What is so lacking in the Chinese parts making industry are the “Senior Engineers”. The prints themselves do not tell the whole story of how to make really good parts that last the 15 years and 200K miles. That information comes from experienced Senior Engineers who really know and understand the product. The second “missing” item is “metals, plastics and materials” knowledge. There are hundreds of alloys of metals and plastics. It cannot all be done with 3 shades of brass and four of Iron. China really hurts for the lack of the right materials and the right knowledge.

  10. pedro fernandez Says:

    I have been told many times about the poor quality of Chinese steel which explains why my Chinese made wheel bearings failed so quickly.

  11. Kit Gerhart Says:

    2 If ranked by employees per vehicle, Daimler would probably top that list by a wide margin. Is that why their cars are so expensive? Vertical integration isn’t cheap.

  12. HtG Says:

    Off topic

    Lord, what a day it was today. DC F&G

  13. GJason Says:

    Regarding Nissan being the only Asian auto manufacturer currently selling commercial vehicles in the US market: what about Toyota’s Hino subsidiary? Am I correct in saying that they sell and even build product in the US?

  14. Kit Gerhart Says:


  15. Tom Tyson (ARHPG) Says:

    In the segment, Is Apple Developing The iCAR, were comments that “Apple has $178 billion in cash, enough to buy GM, Ford and FCA.” More realistically is the prospect that Apple will venture into the electric-car business—perhaps even absorbing companies like perennial money-losing Tesla—enabling the free-wheeling Elon Musk to venture into even wilder projects. Speaking of General Motors—and moving obliquely to the rear—it is interesting that U.S. taxpayers no longer own any of GM, but one wonders why the Treasury Department sold the last of its shares in 2013 and couldn’t hold on just a little longer to try to recoup taxpayers’ loss of $10+ billion now that GM has become relatively profitable, less we quickly forget the “Motors Liquidation Company.” With GM being accused of “holding too much cash with about $28 billion in the bank,” it simply epitomizes the waste and incompetence in government to simply write down the debt. What an ugly mess.