Our Perspectives
Rick Schostek, SVP Honda of America Mfg., Inc.
As we celebrate Honda's 30th year of making cars in the U.S., I am reminded of a story I was told by a Honda associate - that's what we call all our employees - at our auto plant in Alabama.
Whenever a new project began at his previous employer, he said that everyone received explicit instructions on how to do their jobs: "Here's how to build a forging line, follow this blueprint!" This associate told me he was very surprised when he received a new assignment at Honda and his instruction was simply: "Go to the Honda engine plant in Ohio and see what they have done. Then make sure this new one is better."
This has been our path in North America over the past 30 years, ever since that first Honda Accord rolled off the line at our Marysville, Ohio auto plant on November 1, 1982. There is no cookbook at Honda, no predetermined way of doing things that would dampen the initiative and creativity of our associates. This makes the "Honda Way," a bigger challenge in some respects, but it also creates a bigger opportunity by encouraging innovative thinking and fostering the growth of our people - our most precious asset.
I clearly remember from my early days in Ohio, how we opened our doors to the leadership of factories from the Detroit automakers. After all, many skeptics thought it was a risky move for Americans to build Honda products in America. Well, the skeptics were wrong. Soon our competition wanted to tour our new Marysville Plant to understand how we built high quality vehicles in the U.S. with such efficiency and flexibility. It didn't take long before the industry, and our customers, began to view Honda as the benchmark auto producer in North America. We have never looked back.
Today - we have seven auto plants in North America with an annual capacity of 1.63 million units. This spring, we broke ground for a new plant in Mexico that will build Honda sub-compacts like Fit, and increase our capacity to 1.92 million in 2014. And we are expanding and innovating our existing production operations in Ohio, Alabama and Indiana. Over the past 18 months alone, we've invested more than $2 billion. So in the coming years, well above 90 percent of the Honda and Acura vehicles our customers purchase will be made in North America.
In an auto industry whose history is pockmarked with plant closures, Honda's story in North America has been one of continued growth and ongoing investment in our existing plants to keep them on the leading edge of quality, efficiency and flexibility. It's really an investment in the nearly 26,000 people working in our plants. And it's a never-ending commitment.
Through the years we have worked to keep our original Marysville Auto Plant state-of-the-art. This includes major investments over the past decade in all-new weld, paint, assembly and stamping operations. In fact, about the only thing that hasn't changed about the Marysville Auto Plant is that it still builds the Honda Accord, the car that started it all back in 1982. We just launched production of the all-new 2013 Accord. Through it all, we've navigated through good economic times, and bad, without a single associate layoff.
So, I think it's significant that, 30 years later, the Marysville Auto Plant took home the Silver award in this year's J.D. Power and Associates Initial Quality Study. When you consider that our production associates achieved such high quality while coping with the stops and starts caused by two unprecedented natural disasters last year -- a tragic earthquake and tsunami in Japan, and devastating floods in Thailand -- it's really an extraordinary achievement. Our associates constantly seek to exceed our customers' expectations. Their pride is on display every day.
In the coming years, our associates will take on a new role that is unprecedented for an international automaker in the U.S., a role that is both challenging and humbling. In the past, our team has been responsible for the launch of numerous products that are developed and built exclusively in America, including the Honda Odyssey minivan, Ridgeline truck and Pilot SUV. This new responsibility calls on Honda associates in North America to set the standards for production processes for key global products that also are made in other regions - and then to share their knowledge and expertise with those Honda plants all around the globe.
Based on this new leadership role, we also will increase exports from North America to global markets. This fall, Honda will reach the one million mark in total automobile exports from the U.S. Further, we're expecting an almost 70 percent increase this year in the export of major auto parts from the U.S. to Honda plants in South America, Europe and Asia. This is a substantial increase in business for North American suppliers that will grow even greater in the coming years.
The continued expansion of our North American manufacturing operations, combined with the new leadership role we will play, speaks volumes about our confident outlook for the future.
After three decades of building cars in America, using both domestic and globally sourced parts, what's important is not so much a major milestone like the 30th anniversary of Honda auto production in Ohio, but what it represents - through deep associate involvement and teamwork we are committed to our original vision: achieving the highest levels of quality for our customers in America and around the world.
That's the only blueprint Honda will ever need. # # #