Honda Motor Co. Ltd was founded by Soichiro Honda on September 24, 1948, based in Tokyo, Japan after realizing the great travel demand of Japan after World War II. The company started manufacturing from motorcycles to scooters. In the late 1960s, Honda dominated the world motorcycle market. By the 1970s, the company had become the largest motorcycle manufacturer in the world up to the present time. After that, the company began to expand car production in 1960.
I, HONDA OVERVIEW 1, Honda Company Overview - Honda Motor Co Ltd was founded by Soichiro Honda on September 24, 1948, based in Tokyo, Japan after realizing the great travel demand of Japan after World War II The company started manufacturing from motorcycles to scooters In the late 1960s, Honda dominated the world motorcycle market By the 1970s, the company had become the largest motorcycle manufacturer in the world up to the present time After that, the company began to expand car production in 1960 - Today, Honda is the fifth largest automobile manufacturer and the number one motorcycle manufacturer in the world, with more than 14 million engines per year in more than 100 production facilities → over 30 countries worldwide Honda's main product lines are automobiles, motorcycles, electrical products, mobile technology products and aviation Honda's main markets are North America, Europe, and Asia Currently, the Chairman, CEO and Representative Director is Mr Takahiro Hachigo - Vision – mission + Vision: Honda becomes the world's leading automobile, motorcycle and technology product manufacturer + Mission: Honda maintains a global stance of providing the best quality products at prices that satisfy customers around the world 2, Honda Vietnam Overview + In March 1996, Honda officially received an investment license in the Vietnamese market and only years later the most modern motorcycle manufacturing factory in Southeast Asia was inaugurated at the head office of Honda company: Phuc Thang - Phuc Yen - Vinh Phuc with initial investment capital of more than 290 million USD Honda Vietnam Company is a joint venture with 03 partners: Honda Motor Company (Japan – 42%), Asian Honda Motor Company (Thailand – 28%), Motivation and Agricultural Machinery Corporation Vietnam – 30%) + Since Honda entered the Vietnamese market, the company has continuously invested in building production infrastructure to meet the increasing demand of the market - where motorcycles are the vehicle that accounts for nearly 90% of the total in big cities + Honda has a strong presence in Vietnam, with six manufacturing factories spread across different provinces of the country (Including motorbike manufacturing plants, car manufacturing plant, and plants producing various types of spare parts) These factories produce a range of high-quality products, including motorcycles, automobiles, power products, electronic components, and precision components With an annual production capacity of millions of units and employing more than eights of thousands of workers, Honda's factories in Vietnam play a crucial role in the company's global supply chain, providing high-quality products to both domestic and international e markets II Analyzing the External Environment in Honda Viet Nam: General Environment - PESTEL Analysis Political: A business unit is critically influenced by the form of political law Every decision of expanding the consumption scale and prices are governed by the policy of the state management agencies Motorbike manufacturing is also affected by taxes, commercial laws, business laws, According to state policy, motorbikes will be banned from Hanoi in 2030, which will greatly affect the company's production strategy and sales Rather than focusing on motorbike production, the company can invest more in the development of automobiles The director of the company confirmed that: Honda Vietnam continues to maintain its position as the leading company even after society has shifted to a period of "Car goods" (Vision of 2030) Economic Economic environment affects consumer buying power and spending patterns.The research is about Honda motorcycles On the other hand, it examines all factors which are involved in the economic environment that influence the manufacturing and sales of motorbikes in Vietnam In fact, Vietnam is a developing country in the process of industrialization and modernization, and therefore, many economic factors have recently changed Our essay covers four parts belonging to the economic environment a Inflation rate: Firstly, the inflation rate in two countries, Japan and Vietnam, are analyzed Japan, the founder of Honda, will be considered first The inflation rates of Japan and Vietnam are always changing It will cause many products' prices to decrease or increase or stay constant, and the cost of materials usage in making motorcycles will follow in a similar way This may impact the price of the final products Besides, when motorbikes are delivered as export products to Vietnam, this price may be reduced However, the motorcycle market usually stays stable,so its price tends to stay constant Therefore, the motorcycle producers likely increase the quantity of motorbikes instead of changing the prices of products There are two kinds of motorcycles, one is assembled in Japan and another is assembled in Vietnam However, the reason for mentioning the inflation rate in Vietnam is that only a few percent of domestic production accounts for high-value components of vehicles Components manufactured in Vietnam are mostly simple spare parts such as seat belts, seats and wire The rest of the critical equipment with high technological content is mostly imported from other countries The increase in the inflation rate likely leads to the increase in the sales of products b Consumer spending: Consumer spending in Vietnam is the other crucial part According to MACROTRENDS (2021), Vietnam consumer spending for 2021 was $202.97B, a 4.63% increase from 2020 Vietnam consumer spending for 2020 was $193.99B, a 2.09% increase from 2019 Vietnam consumer spending for 2019 was $190.01B, a 7.35% increase from 2018 Because of the increase in consumer spending it indicates that Vietnamese people recently tend to spend more The market encourages people to spend as well as their ability to it Based on this information, producers could decide to increase the production of products and focus strongly on the Vietnamese market as the destination of export c The level of income This is the important part, Honda could briefly understand about the change in consumer behavior and buying power According to the World Bank the level of income has gradually increased every year GDP scale at current prices in 2022 was estimated to reach 9,513.3 million billion VND, equivalent to 409 billion USD[7] GDP per capita in 2022 at current prices was estimated at 95.6 million VND/person, equivalent to 4.110 USD, up 393 USD compared to 2021 Besides, the average cost of a motorcycle selling in Vietnam varies from $800 to $900 Basically, Vietnamese people could buy a motorbike by themselves with one or two years of savings Consequently, the level of income is predicted to increase in the future, so not only Honda but also the other companies likely produce and export more motorcycles in order to increase their revenue as well as profit Moreover, the Vietnamese market is still a potential market to invest and develop the motorcycle industry d Global effect Becoming a member of the World Trade Organization (WTO) promotes Vietnam's economy to develop deeper and wider in the global economy The opportunity to take advantage of external resources accelerates the process of industrialization and modernization in Vietnam Additionally, Vietnam has already set a target in 2020 to basically become an industrialized country Furthermore, there is another potential segment in the Vietnamese market: the foreign workers who work and live in Vietnam for a long period of time The market in Vietnam basically grows slightly, and it creates great opportunities for international companies The growth in the economy leads a lot of foreigners to come to Vietnam Some of them come for working and others for living and getting married Consequently, because there are many opportunities for international companies to invest in the Vietnamese market, a huge number of foreign laborers are working in Vietnam The Vietnamese market is likely a potential market Social culture: Social culture and the ways of doing things impact the culture of an organization in an environment Sharing beliefs and attitudes to the consumers play a great role in how marketers at Honda Motor Co., Ltd understand the customers of a target market and how they design the marketing message for Auto Manufacturers - Major industry consumers Social factors that leadership of Honda Motor Co., Ltd should analyze for PESTEL analysis are • Demographics and skill level of the population ● Age: golden population (15-60: 69.3%) ● Skill level: low-most of the population is the manual worker ● -Class structure, hierarchy and power structure in the society ● -Education level as well as education standard in the Honda Motor Co., Ltd ’s industry: ● -95% know how to read and write ● -Culture (gender roles, social conventions etc.) ● -Manpower but more and more equal ● -Entrepreneurial spirit and broader nature of the society Some societies ● encourage entrepreneurship while some don’t ● -Attitudes (health, environmental consciousness, etc.) ● -Leisure interests Nowadays, the role of women is increasing Moreover, their incomes are higher day by day that leads to the demand for motorbikes, which are suitable for women, increase The government officially recognized the equality of the genders, and women obtained employment in professions which had been previously dominated by men It is a chance for Honda to develop a product for women such as lead - Vietnamese people always prefer to have the personal vehicle as an asset, not a public transportation, besides the price of the car in Vietnam is very high due to the import tax so it is the opportunity for them to sell the product - Vietnamese people believe that Japanese products have the best quality They always want to buy products made in Japan first Technological Technology is fast disrupting various industries across the board The transportation industry is a good case to illustrate this point Over the last years, the industry has been transforming really fast, not even giving chances to the established players to cope with the changes A firm should not only the technical analysis of the industry but also the speed at which technology disrupts that industry Slow speed will give more time while the fast speed of technological disruption may give a firm little time to cope and be profitable Technology analysis involves understanding the following impacts - Recent technological developments by Honda Motor Co., Ltd Competitors +Technology's impact on product offering +Impact on cost structure in Auto Manufacturers - Major industry +Impact on value chain structure in the Consumer Goods sector +The rate of technological diffusion Legal: - Relating to localization issues, while motorcycles imported from foreign countries suffered 30-40% tax rate, the components imported for domestic assembling just suffered 20-25% tax rate, so local motorcycles will have a great advantage in price competition, especially for moderately priced motorcycles Since 1998, Honda has built three large motorcycle factories in Vietnam, producing about 2.5 million products per year - Nowadays, because of joining economic organizations, the tariff barriers are gradually abolished According to the project in 2018, the import tax on motorcycles fell sharply, even some motorbikes are free-tax imported from Thailand Therefore, the company are forced to bring out competitive solutions, such as lower costs, improve quality, creating more incentive programs and enhancing warranty service or repair Environmental Environment pollution in our country is increasing seriously, mainly due to the waste from industrial zones It is estimated that out of 183 industrial parks in the country, over 60% of industrial parks not have a centralized wastewater treatment system Therefore, since 2001, Honda Vietnam has applied a comprehensive environmental management system ISO 14001 in the production process with modern waste treatment systems, waste water and improve the efficiency of using energy quantity This system has contributed to reducing CO2 concentrations in the workshop from 5107mg / m3 in 2003 to 1403mg / m3 in 2004 and less than 900mg / m3 in 2005 and 2006 In Vietnam, motorcycles are the most common means of transportation and motorcycle emissions are also a major cause of air pollution In that situation, the company has produced motorcycle exhaust to ensure emission standards in order to not harm the people.- In addition, the scarcity of natural resources is also a concern of mankind Therefore, the creation of fuel efficient and environmentally friendly motorcycles is a matter for Honda Vietnam In 2006, the company introduced a new, eco-friendly and fuel-efficient, which features a new 108cc engine, which is cooled by a radiator with integrated exhaust Nox, HC and CO2 are even lower than the Euro-2 standard12 Task Environment - FIVE FORCE analysis Customer: - Characteristics: Female (35%) and male (65%) Age groups: 18–24 years (45%); 25–34 years (38%); 35–44 years (13%), >44 years (4%) Income: medium to high Medium price sensitivity: + Dominate the market in Vietnam ( 66% market share in 2015) + brand loyalty + reasonable price with high quality - Customer market: Honda’s main goal is to provide high quality transportation for Vietnamese people at a reasonable price Nowadays, motorcycles are considered as the most common means of transportation in Vietnam On average, there are 2-3 motorcycles in each house in Vietnam So, Vietnam has a large motorbike consumption Honda consumers in Vietnam include both females (35%) and male (65%) They divide customers into many different segmentation groups such as 18- 24 years old (45%), 25-35 years old (38%), 35-44 years old (13%) and over 44 years old ( 4%) According to the World Bank, the level of income has gradually increased every year Vietnamese people could buy a motorbike themselves without saving money for to years Honda customers have medium price sensitivity because HondaCompany has dominated Vietnam market with 66% market share in 2015 Moreover, Honda Company built a strong brand loyalty of customers So, in case Honda motorbike rises prices, customers will still purchase their products for high quality, brand image Competitors: In Vietnam’s market -Main: Yamaha +Weakness: cannot compete with Honda (Honda Vietnam) in terms of quality: durability , fuel economy +Strength: Yamaha has more advantages than Honda Vietnam in terms of various types This type of company is very rich, diverse and fashionable -Honda: 26% -Yamaha: 14% - Other competitor: SYM, Suzuki, Piaggio - Honda Vietnam has sold over 20 million motorcycles and scooters, occupying about 60 per cent of the market, reaching far ahead of competitors, including Yamaha Vietnam, Suzuki Vietnam, Piaggio Vietnam or SYM In order to reduce the threat posed by too much competition in the motorcycle manufacturing industry, Honda has made many efforts to distinguish itself from its competitors by creating differences and uniqueness of its products and services It also has patented its key technologies 3 Suppliers: Suppliers are individuals or companies that provide businesses with the resources to produce complete products (cars, motorcycles) - In order to produce motorbikes, cars, Honda has to buy steel, aluminum, tires and other materials In addition, the company also has to buy labor, fuel equipment, electricity, computers necessary to produce vehicles Honda Vietnam imported spare parts from Japan, Thailand, China In order to meet the demand of quality, marketing managers always pay attention to the events occurring in the "supplier" environment, because those events can affect the company's marketing Specifically, we can look at the earthquake risk in Japan,which has a huge impact on the automatic industry and at the same time affects the supply of spare parts of Japanese companies for Honda Vietnam Company Moreover, the company must always focus on risks from suppliers At this time, Honda Japan is pausing the exportation of spare parts from a number of factories but represents Honda Vietnam This statement does not affect the production of this joint venture "because we have a sufficient stock of reserves and if necessary we will consider finding another supplier to maintain production” Representing a dealer of Honda Vietnam also confirmed that the amount of spare parts at the dealer is not missing as the dealer of Honda plans to import spare parts for the year so the amount of spare parts in the warehouse "is still enough” Despite a long supply of supplies from Japan In addition, the marketing department of Honda Vietnam always pays close attention to the price of goods from suppliers, because the increase in the price of materials purchased can cause the company to increase prices of goods Thus, Honda also affects the companies, dealers, making them cannot have the competitive products of motorcycles and cars of all kinds This will adversely affect the position of the company in the market Suppliers ensure the resources needed for the business of producing and trading products Marketing managers need to grasp the ability of the suppliers both in quality and quantity Delay or supply shortage makes marketing difficult because it can harm the ability of the target customer to meet the demands and will inevitably affect sales, which is because the customers may switch to products of competitors Substitute products: In fact , there are not many substitutes that are considered a serious threat to the automobile Currently, there are a number of products that can replace cars such as motorbikes, buses, trains, planes, boats, old cars, etc Features of substitute products: - Motorcycles: have a price that is suitable for most people's pockets, suitable for the condition that the traffic infrastructure has not yet developed in Vietnam, but currently the motorbike market is freezing and tends to be stormy because according to the calculation of the Ministry of Industry and Trade, by 2020, the number of motorbikes will be nationwide is million units, reaching the utilization rate of 2.97 people/car At the rate of 2.9 people / vehicle, in Thailand, the motorbike market is saturated - Public bus: This is a public service, so the price is cheap, serving travel mainly in the inner city (under construction) develop ) - Trains, airplanes: Unscheduled and often used on long trips - Boats, boats, canoes: Often used in river areas with a system of canals and rivers interlaced - Old cars: are a big threat to current vehicles because of their cheaper price, suitable for lowor middle-income consumers If the features of an old car are not too different from that of a new car, this will be a potential substitute because customers are willing to switch to a new car using old cars , creating downward pressure on car manufacturers However, if the remaining usage time is included, the use of used cars does not affect the sales of automakers much Therefore, the threat of substitute products in this industry can be considered to be less serious In general, substitute products not put too much pressure on the automobile manufacturing and trading industry in Vietnam Thereby, we can see that the Vietnamese automobile market has a lot of potential and follows the inevitable trend, this is an "attractive" piece of cake in the future Pressure from potential opponents: The attractiveness of the industry: according to the theory, with the world's leading economic growth rate, large population size and current level of integration, it is completely possible to believe in the ability to develop in The future of the automotive industry in Vietnam However, the wave of world automobile corporations continuously pouring capital into Thailand shows that the Vietnamese auto market is losing its attractiveness (2011), and in 2012 it tends to prosper because according to the explanations of economists auto business, on In fact, people's real demand for cars is still relatively high, so there has been a clear shift in the market segment with the sudden increase of personal cars compared to commercial vehicles despite the difficulties economic hardship However, there are always barriers to entering the industry: • Economic scale: long-standing automobile companies such as Ford Vietnam, Toyota Vietnam, Honda Vietnam, GM Daewoo, Hyundai Motor Vietnam… they have a large scale, invest in modern equipment, and produce high-quality products produce products in large quantities, thereby reducing the cost per unit significantly Enterprises that want to enter the industry will have to invest approximately the same scale as the above companies to be able to compete • Product differentiation: emphasizing customer loyalty and brand awareness to customers reputable companies in the market Because cars are luxury products, when deciding to buy, people often think very carefully, they will give preference to products of famous brands over products of some new car company • Requires capital : The automobile manufacturing and trading industry requires a very large amount of initial capital and the ability to recover capital is slow This is also a significant barrier for new firms • Switching costs: is the cost that buyers have to pay to change the source of supply Including: staff training costs, the price of new equipment attached The higher this cost, the greater the barrier • Distribution channel: the characteristics of this industry are which firms have their own distribution channels If a new company wants to enter the industry, it must invest in building its showrooms This requires a large amount of capital • Other cost disadvantages unrelated to scale: old competitors often hold: product copyrights, patent rights, secrets, cheap raw materials, favorable location, CP's allowance, experience should create challenges for newcomers Analyze business strategies of enterprises in Vietnam market 3.1 Building brand identity system Name: HONDA – both powerful and unique, the font is designed with red capital letters showing strength and creativity Logo: Looking at this logo, everyone knows that this is the logo of Honda Vietnam This familiar bird logo has left a very deep impression in the minds of Vietnamese people Slogan: "The Power Of Dream" Everyone has a dream, an active goal that makes our lives more profound and meaningful When we chase our dreams, we feel empowered A successful slogan often carries an impressive message and arouses the customer's imagination about the product For Honda, instead of having to talk at length about the company's criteria, the company used the slogan "The Power Of Dream" to express the criteria the company wants to bring to consumers Honda Vietnam wants to bring every Vietnamese citizen more safety and happiness in life This slogan is like a message that Honda wants to send to all customers: "Become a company expected by society, make every effort for the development of the country and Vietnamese people" 3.2 Brand development strategy ● Low cost strategy Honda's goal is to create a competitive advantage by creating products at the lowest cost Thus, stemming from the use of a multinational strategy for the motorcycle product Honda has focused on developing its manufacturing plant in Vietnam to take advantage of Vietnam's advantages of location economies In addition, Honda also focuses on the strategy of developing a variety of product lines targeting different target customers, from low-priced cars to high-end segment cars Typically, in 2002, Honda launched the Wave alpha motorcycle with the price of 13,690,000 VND, durable quality, compact design suitable for the needs of rural consumers - low income This low-cost competitive strategy has helped Honda capture the rural market of 70% of Vietnam's population ● Success: Honda Vietnam has been successful with low-priced but good-quality cars such as Super Dream, Wave α These vehicles have brought high satisfaction to consumers In the early stages of business in Vietnam, Honda faced great competition from low-cost Chinese motorcycles, but through a low-cost strategy, Honda launched a product assembled in Vietnam, Wale α with the same price as Chinese motorbikes but with higher quality, thereby helping Honda regain market share and grow stronger in Vietnam ● Limit: The low-cost strategy has brought great success to Honda Vietnam, but there are still many limitations in the strategy implementation process The price Honda offers for some products is still high, the company can still reduce the price further through improved human resource cost management and the difference between the company's proposed price and the market price ● Differentiation strategy Honda has the largest product chain among motorcycle manufacturers in Vietnam, spanning all segments There are a total of 14 models with engines of 300 cc or less The diverse prices and models make Honda motorcycles suitable for all types of customers, from affordable, intermediate to high-end, from young to middle-aged people, including both men and women Digital models have Wave, Blade and Future Scooters span many price points, including Vision, Air Blade, LEAD, PCX, SH Mode and SH In particular, the SH motorcycle series is a high-end product line with many unique and outstanding features to target high-income customers, young people, who like trendy and classy products The line of personal clutches has products: WINNER, MSX and Monkey Large displacement vehicles with both throttle and clutch, are SH 300i and Rebel 300 Each model is divided into many small versions, diversifying choices for customers For example, Wave has Alpha and RSX FI that differ in design and technology; PCX has engine options 125cc, 150cc and Hybrid; SH has engine options from 125cc, 150cc to 300cc Such versions are further subdivided with CBS or ABS brake configurations, creating a huge product network Honda products are known for their durability, beauty, powerful engines and fuel economy With any product line, Honda always innovates designs and techniques over time to suit consumers Eg: - Wave series ● Wave α (2002) ● Wave RS ● Wave 110 RSX - Future series · Future · Future X · Future X FI ● Success: Honda offers a very convincing differentiation criterion for customers to buy products that are "fuel economy" With the introduction of FI technology, electronic fuel injection, Honda Vietnam has hit the customer's mind when the price of gasoline increases continuously, contributing to a rapid increase in market share In addition, the company offers a strategy aimed at young people, the population making up a large proportion of the total population, Honda takes the very youthful slogan "Be U with Honda" along with a loud advertising strategy popular in the media, creating a youthful new image for Honda, which was considered a product for people of the previous generation Honda products always improve in eye-catching designs and colors to catch up with the dynamism of young people ● Limit: Honda's differentiating technology was not a breakthrough, just an improvement of existing technology, so Honda's innovation was quickly taken up by other companies with similar products ● Focused Strategy In addition to the above product line, Honda also offers a number of product lines suitable for female customers such as convenience and fashion while the price is only average This is a very easy to use vehicle, no need for clutches, gears, a large storage box that can hold many important things this vehicle has many rich, unique, luxurious and suitable designs with the personality of young people, especially women Therefore, Honda scooters are more and more popular Honda Vietnam Company has launched a new type of scooter called Click, and then respectively: Air Blade (April 2007), Click Play (September 2008), Lead (December 2008) ● Success: Another success in Honda's business strategy can be said to be the focus strategy Realizing the rapid increase of customers who have high demand for scooters, the company quickly launched scooter products for the high-end segment: SH, Spacy, @ This model is continuously improved by Honda to meet the needs of customers In addition to the high-end scooter line SH Honda Vietnam also offers products such as PSi, @, Here Honda has created a new segment for the high-end scooter market, thereby competing directly to win a lot of scooter market share of Piagio and other automakers ● Limit: In addition, the above strategy also has many limitations: The price is always set at a high level such as SH, Spacy, @, PS, making sales low, cars are often in inventory, making it difficult to implement business plan The image of Honda has been adversely affected by setting prices too high, creating artificial scarcity to always push prices up The quality of vehicles in the focus strategy does not have much improvement, usually only a change in styling 3.3 Brand promotion communication Honda is a very strong brand in advertising communication, with advertising campaigns ranging from television to Outdoor advertising On the roads we can see Honda ads, aggressive ads for their new product lines, or just propaganda about traffic safety Moreover, television advertising is Honda's strength with dense advertising TVCs and is carefully focused on the young vitality of Vietnam Honda cooperates with Vietnamese television station to launch a series of programs "I love Vietnam" with the aim of increasing traffic safety awareness in Vietnam The program is strongly communicated on television and also on the Internet with great coverage nationwide With this tactic in Honda's marketing strategy, the company wishes to be able to create sympathy with customers, increase reliability and "pin" in the subconscious about a clean brand, increasing the level of customer satisfaction identified As a result, people can see how successful it is with annual sales at more than 80% of the motorcycle and 7% automobile market share In addition, Honda also organizes a series of events such as: "Honda - full of faith", "BeU + with Honda", to thank customers for sticking with Honda Vietnam, thereby not only reinforcing loyalty old customers but also build a good image in the eyes of new customers Besides communication on the media and advertising billboards, promotions are also a strong point of Honda when constantly offering promotions with preferential prices These are probably Honda's most successful promotional campaigns Usually in these campaigns, when you buy a Honda motorbike like a Dream car, you are given a Honda-made helmet, a fee support when registering the vehicle's paperwork, and possibly maintenance periodically at Honda centers without paying Mobile service programs to other provinces demonstrate how much the company cares about customers, and each month, activities like Honda's BeU often hold promotions to enhance service This strategy is very popular with customers and it generates positive feedback from the public Effective business strategy of Honda Vietnam When participating in international business, companies in general and Honda in particular often have to adjust their activities and products to suit actual conditions Therefore, for each stage, each different market segment Honda Vietnam has different business strategies Honda VN takes advantage of the available resources of intermediaries, from capital, people, management to customer service and relationships with potential customers as well as public agencies rights in the local market More than anyone else, Honda understands that the distributor is their extension arm in the market, they know how to take advantage of the power of the Head to penetrate and conquer the Vietnamese market with the following numbers we can see This is achieved with: The capacity of motorcycle factories is 1.5 million vehicles/year and the automobile assembly plant is 10,000 vehicles/year With annual revenue of over billion USD, Honda Vietnam is the largest FDI enterprise in Vietnam Overall, Honda does business in Vietnam in many fields, but Honda's main products are motorcycles Each product includes many segments, such as: popular segment, mid-size segment and luxury segment Therefore, to well in the Vietnamese market, Honda needs to use and combine many strategies IV Honda’s Business Strategy Comparison between different market: Vietnam, China and India Similarity: Localization Honda has localized its products in all three markets to suit the needs and preferences of local consumers In China, Honda has developed a long-wheelbase version of the Accord to cater to the Chinese consumers' preference for spacious vehicles In India, Honda has developed models such as the Honda Amaze and the Honda City with features that are popular among Indian consumers, such as fuel-efficient engines and affordable prices Expansion of production facilities Honda has invested in expanding its production facilities in all three markets to increase its production capacity and meet the growing demand for its products Honda has set up joint ventures with local Chinese partners to produce and sell cars in China, and it has set up a new manufacturing plant in Gujarat, India, to increase its production capacity Focus on electric vehicles Honda has increased its focus on electric vehicles in all three markets In China, Honda has introduced several hybrid and electric vehicles In India, Honda has launched a new motorbike version at the Auto Expo 2020, which is expected to be launched in the Indian market soon In Vietnam, Honda has introduced the Honda PCX Electric scooter Partnerships with local companies Honda has formed partnerships with local companies in all three markets to expand its presence and leverage local expertise In China, Honda has set up joint ventures with local partners such as Guangzhou Automobile Group and Dongfeng Motor Corporation In India, Honda has formed a partnership with Hero MotoCorp to manufacture and sell motorcycles under the brand name Hero Honda In Vietnam, Honda has formed a partnership with the Vietnam Engine and Agricultural Machinery Corporation to produce motorcycles Digitalization Honda has embraced digitalization in all three markets to enhance the customer experience Honda has introduced digital showrooms and online sales platforms in all three markets to cater to the growing number of consumers who prefer to shop online Differences Vietnam China India Market Size Vietnam has a relatively small market size compared to China and India Honda's business strategy in Vietnam focuses on producing motorcycles that cater to the needs of the Vietnamese consumers Honda has a strong market position in Vietnam, and it is known for producing high-quality, reliable motorcycles China has the largest automobile market in the world, and it is also a significant market for motorcycles and power equipment Honda's business strategy in China focuses on producing a wider range of products, including cars and power equipment, with advanced technology and safety features Honda's products in China are known for their quality, reliability, and advanced features India is the world's largest two-wheeler market, and Honda's business strategy in India focuses on producing affordable and efficient motorcycles and scooters that cater to the needs of the Indian consumers Honda has a strong market position in India, and it is known for producing high-quality, reliable two-wheelers Consumer Behavior Vietnamese consumers are price-sensitive and value fuel efficiency, reliability, and low maintenance costs -> Honda's business strategy in Vietnam focuses on producing affordable and efficient motorcycles that cater to the needs of the Vietnamese consumers Chinese consumers are becoming more quality-conscious and are willing to pay more for high-quality products -> Honda's business strategy in China focuses on producing high-quality products with advanced technology, safety features, and comfort Indian consumers are also price-sensitive and value fuel efficiency, reliability, and low maintenance costs However, they also value style and comfort in their two-wheelers -> Honda's business strategy in India focuses on producing affordable and efficient motorcycles and scooters with stylish design and comfortable riding experience Competitive Landscape Honda faces competition from local and foreign motorcycle manufacturers in Vietnam However, Honda has a strong brand reputation and a wide distribution network, helps it maintain its market position China's automobile and motorcycle markets are highly competitive, with both domestic and foreign manufacturers Honda faces tough competition from local and foreign motorcycle manufacturers in China Honda competes with other established automotive manufacturers such as Maruti Suzuki, and Hyundai where brands such as Hyundai and Maruti Suzuki dominate the market Manufacturing and Production Set up a manufacturing plant to produce motorcycles, automobiles, and spare parts Set up joint ventures with local Chinese companies to manufacture and sell motorcycles, automobiles Established two manufacturing plants to produce motorcycles and automobiles, and the company also sources components from local suppliers Marketing Promotion Focused on promoting its brand through social media, sponsorships, and advertising campaigns that appeal to younger consumers It has used celebrity endorsements and promotional events to enhance its brand image and appeal to consumers Promoting its fuel-efficient vehicles and safety features through advertising campaigns and customer engagement programs and V BUSINESS STRATEGIES COMPARISON OF HONDA & OTHER COMPANIES IN THE SAME INDUSTRY IN VN Since Vietnam's economic reform in 1986, Vietnam's economy has undergone many changes, with rapid growth, the domestic market has opened up, creating favorable conditions for foreign enterprises to penetrate the Vietnamese market The automobile and motorbike industry is a nascent industry, so this is a good opportunity for motorcycle manufacturers to jump into the Vietnamese market Some of the favorite motorcycle brands at the moment are Honda, Yamaha, Suzuki, and Piaggio Pricing Strategy HONDA PIAGGIO SUZUKI YAMAHA Honda focuses on a strategy of developing a variety of product lines targeting different target Selected a market segment where customers have high income, this is a difficult market segment because this To gain a foothold in the hearts of customers, a quality product is not enough, it must also come with a reasonable New product pricing strategy: Skimming pricing is to sell a product or service at a premium if the product or service has unique benefits Differentiation strategy customers, from low-priced cars to high-end cars Honda offers Wave alpha motorcycles priced from VND 13,000,000, durable quality, compact design suitable for the needs of rural consumers - low income This low-cost competitive strategy has helped Honda capture the rural market of 70% of Vietnam's population market segment is very difficult, the product requirements are very high Honda products are known for their durability, beauty, powerful engines and fuel economy With any product line, Honda always innovates designs and techniques to meet consumers's demand In addition, Honda also introduced into the Vietnamese While other motorcycle manufacturers introduce new models to the market, Piaggio offers new product lines that are always traditional and cultural in the shape of a boot But they were not popular at first, until the "princess" Vespa Lx was released price And it seems that Suzuki is meeting the needs of customers for a "ngon, bổ, rẻ" vehicle or characteristics Therefore, when the product or service is no longer unique because there are similar products or services, the selling price will gradually decrease Price adjustment strategy with discount: Automatic card program is a special care program for members of Yamaha Fan Club and customers who buy and use motorbikes of the limited company Yamaha Motor Vietnam All members and customers who own an Automatic card will enjoy good incentives Suzuki is considered very durable and requires little repair The engine of Suzuki motorcycles is highly appreciated, strong and durable Another point, many Suzuki motorcycles are now equipped with a lot of Yamaha's motorcycles have very strong, powerful engines, good acceleration, fast acceleration, so they are loved by many young people and have the advantage of long-distance riding The most popular Yamaha manual transmission motorbikes are the Jupiter series, the Marketing Strategy market a high-quality product line such as SH motorcycles and most recently CPX This is a high-end product line with many unique and outstanding features to target high-income customers, young people, who like trendy and classy products => created a fever and brought beauty services to the car modern and smart technology For example, the Suzuki GSX-R150 2021 clutch scooter is equipped with a 1-click start button, making it easier to start the car In addition, all models meet EURO emission standards, contributing to more environmental protection Nouvo and Nozza scooters are also not very impressive However, at the Yamaha clutch line, it is almost the king on the market with the Exciter, FZ 150, … Honda is a very strong brand in advertising communication, with advertising campaigns ranging from television to Outdoor advertising On the roads, we can see Honda ads, aggressive ads for its new product lines, or just propaganda about traffic safety (series "I love Vietnam" ") Moreover, television advertising is Honda's strength with dense advertising TVCs and is carefully focused on the In addition to using advertising channels, Piaggio also organizes clubs for Vespa's customers, which is a bridge for unfamiliar members to become close to each other => trend In online motorcycle forums, Vespa is considered the strongest with a large number of visitors, news/photos are constantly updated at home and abroad Articles with different styles (witty/informative /…) => Success in creating images in the subconscious Suzuki's promotion marketing strategy is "chọn mặt gửi vàng", becoming the main sponsor for many skiing sports events They are also the current sponsor of the Asean Football Championship (AFF Suzuki Cup) Yamaha is very strong in creating events and media programs with enormous coverage Yamaha's goal is to focus on TVCs advertising new product lines, the company's strategies aim at the awareness of its products to customers Yamaha's marketing strategy is also very up-to-date with recent trend when choosing Social Media to effectively reach users young vitality of mind of customers Vietnam Theredfore, creating strong impression of Piaggio Central Strategy Honda also offers a Dominating the number of product high-end scooter lines suitable for market in Vietnam female customers such as convenience and fashion while the price is only average Besides scooters, Suzuki gradually turned to the niche market of sports clutches and cars under 50 cc, where Honda ignored, choosing a message aimed at young people For the manual transmission motorbike market, Yamaha continues to promote sales of the Yamaha Sirius line - the top-selling digital car model in Vietnam, youthful, suitable for both men and women And the Yamaha Exciter series of clutches with a strong appearance Honda, Piaggio, Suzuki and Yamaha have had the right strategy when entering the Vietnamese market These multinational companies have built nationwide distribution channels, warranty centers providing after-sales services of reputable brands and high service quality, in order to increase customer's trust and satisfaction In general, these motorcycle companies all have a common strategy of always changing and improving their products to suit the requirements of the Vietnamese market and have successfully become the most popular motorcycle line at the moment