Honda
In any normal year, if Honda's full year (ended March 31st, 2021) motorcycle sales revenue had fallen by -13.2% (11.59bn) then one would assume that we were all in deep trouble. But when was the last time anyone in the international motorcycle industry saw anything even remotely resembling 'normal'?
Honda's results for the fiscal year ended at the end of March are remarkable given what happened during that period.
Despite the decrease in demand due to the pandemic, despite semiconductor supply shortages, despite supply chain disruptions, freight costs and all the other materials and component inflationary pressures, Honda has posted consolidated fiscal year operating profit of 660.2bn yen - due primarily it says to "control of selling, general and administrative (SG&A) expenses and cost reduction efforts based on a review of business activities" as well reduced provision for credit losses in its financial services business.
"Despite the impact of an increase in raw material prices, Honda plans to achieve a consolidated operating profit of 660bn yen for the fiscal year ending March 31, 2022 (FY22), equivalent to that of FY21, by increasing unit sales and making progress in initiatives to solidify its existing businesses. Although production adjustments are currently being made at some Honda production operations globally, due primarily to the semiconductor supply shortages, Honda will minimise the impact of such production adjustments for the full-year results.
Total corporate sales revenue was 13,170.5bn yen (a year-on-year decrease of -11.8%), with operating profit up by +4.2% (660.2bn yen). Q4 sales revenue was 3,623.8bn yen
(-4.8%); operating profit was 213.2bn yen (+218.8bn yen).
Its motorcycle business sales revenue was 529.1bn yen (+55.5bn yen) - "the increase was mainly due to the recovery of sales in Asia". Operating profit was 72.2bn yen (+8.7bn yen) - "due primarily to an increase in profit related to changes in sales volume, model mix and cost reduction efforts".
Honda Group motorcycle unit sales were 4.3m units in Q4 (+0.24%) and 15.1m units for the full year (+0.13%). For the full year, unit sales in Europe, North America were essentially flat at 234,000 units, 332,000 units and 215,000 units respectively. Unit sales in Asia were down by nearly 4,000 units for the 12 months (13,319 units) and -21.8% down globally for the 12-month period.
Toshihiro Mibe - 2050 vision
In his first speech since taking the top job at Honda in April, President and Representative Director Toshihiro Mibe laid out his vision for Honda's priorities in the coming decades, defining Honda as a "mobility company that offers a wide range of products."
Stating that Honda will "work comprehensively to address challenges in the areas of the environment and safety," Mibe set out the Board of Directors' ambitions to achieve carbon neutrality and to "lead the advancements which will be made in the areas of mobility, the power unit, energy and robotics" and to remain committed to ensuring the attainment of its goal to "solidify our existing businesses."
The headline news was the "three initiatives in pursuit of zero environmental impact will be striving to realise carbon neutrality for all products and corporate activities by 2050 - not only of our products but the entire product lifecycle including our corporate activities.
"Honda will focus on 'three pillars' of our initiatives - carbon neutrality, clean energy and resource circulation" - also known as the Circular Economy.
"For the further expansion of the use of renewable energy, we will be proactive in promoting the utilisation of hydrogen. We will strive to realise a "multi-pathway of energy," which is a concept of utilising a wide variety of energy sources including carbon-neutral fuels, which will be effective in all areas.
"Including more effective ways to reuse and recycle batteries, Honda is pursuing research on material recycling and will take on the challenge of developing products made from 100% sustainable materials.
"Honda will focus on three core areas - expansion of the utilisation of Mobile Power Packs, utilisation of large-capacity batteries for electrified vehicles and application and implementation of fuel cell systems."
Addressing the electrification of motorcycle products specifically, Mibe laid out a multi-channel pathway, stating that "Honda will strive to lead the motorcycle industry at the forefront of its environmental initiatives with an approach which will include not only electrification but also the improvement of the fuel efficiency of gasoline engines, utilisation of biofuels and other strategies.
"The key to successful electrification of motorcycle products is to consider the battery (which is still expensive) separately from the motorcycle. In developed countries, where electrification is in strong demand by society, we will pursue electrification utilising Mobile Power Pack, targeting our B-to-B (business-to-business) and B-to-G (business-to-national/local governments) customers.
"For personal-use customers, we must not only enhance our product line-up, but also make a large number of battery-swapping stations available and ensure convenience to users by making them compatible with EVs of other makers.
"To accommodate the diverse needs of our customers, in addition to introducing GYRO e: and GYRO CANOPY e: in the area of business-use bikes, scheduled for this year, we are going to introduce three new EV models in the area of personal use, in classes with engine sizes of below 50 cc and below 125 cc, by 2024. We also will introduce new products in the 'FUN' area as well."
Mibe was also 'strong' on continuing to pursue fuel cell technology. "Hydrogen is expected to be popularised as a renewable energy source. Honda has a long history of researching, developing and commercialising fuel cell technologies."
