Honda Memo

Honda Memo - MEMORANDUM TO: Isin Guler FROM: Josh Kahn...

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MEMORANDUM TO: Isin Guler FROM: Josh Kahn DATE: November 3, 2008 RE: Honda Case The purpose of this memo is to analyze Honda’s strategy and implementation for entering the US market between 1960 and 1980. Honda’s Strategy Honda’s strategy for start-up, growth and entry into the US was centered on a long-term approach based on sales volume and market share. The company was willing to accept short- term losses for long-term payoff. Honda formulated its strategy to be based on lower prices and targeted advertizing in order to grow market share in the long-term. Honda’s lower prices reflected their high commitment to research and development and advanced manufacturing techniques, which brought about a productivity-based cost advantage. Each new model was priced below competitive machines ($250 vs. $1,000-$1,500 for bigger American or British machines) and was brought to the market within 18 months, which often allowed Honda to capitalize on first-mover advantages for different models. The lower cost, coupled with a
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Honda Memo - MEMORANDUM TO: Isin Guler FROM: Josh Kahn...

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