Honda Killing Models To Cut Costs, Boost Production Efficiency

Honda will also increase parts sharing on future vehicles.

Honda Motor CEO Takahiro Hachigo looks toward the future in a new speech where he outlines plans to simplify the company’s lineup. The initiative would even include axing vehicles if the company can consolidate similar models from different regions into a single product offering.

Hachigo offered a few specifics about future products. The company intends to offer its two-motor hybrid system throughout the entire lineup. The next-gen Honda Fit debuts at the Tokyo Motor Show this fall, and it gets a new, more compact version of this hybrid tech that works in smaller vehicles.

The new Honda Architecture vehicle development method is also part of the company’s simplification plan by increasing parts sharing among products and improve production efficiency. The first vehicle using this new strategy is a “global model” that arrives next year.

Two-thirds of global sales would be electrified by 2030. These would primarily be hybrids, but there are sure to be EVs, too. The Honda E is among these upcoming models by introducing a dedicated EV city car with an estimated range of over 124 miles (200 kilometers). 

By 2025, Hachigo’s plans to “reduce the total number of variations at the trim and option level for our global models to one-third of what we have now.” He believes the company offers too many equipment combinations in an effort to appeal to different regions, and this is decreasing production efficiency.

Honda’s boss expects the simplification to result in a 10 percent reduction in global production costs by 2025. In the same period, product development would require 30 percent fewer manhours, and the company wants to reinvest that time into research and development of new technology.

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