Temple of VTEC Rumors and News - Honda to Strengthen Structure of its R&D Operations

TOKYO, Japan, February 21, 2006 � Honda Motor Co., Ltd. announced plans, effective April 1, 2006, to launch a new organizational structure for Honda R&D Co., Ltd., a wholly owned subsidiary of Honda responsible for research & development activities.

Due to recent technological advancements and continued business expansion, the variety and complexity of technological components and the number of vehicles under development at Honda R&D have increased dramatically. The new structure will be launched both in response to this situation and to prepare for further expansion of business in the future. The new structure will enable each associate to demonstrate a high level of initiative, with more clear definition of roles and responsibilities and bold delegation of authority. Moreover, the new structure is designed to achieve smoother communication to help accelerate decision making within the organization. The key elements of the new structure are as follows:

Outline of the New Structure:

Existing R&D centers including Asaka R&D Center, Wako R&D Center, and Tochigi R&D Center, which are currently organized based on geographical location, will be reorganized into five centers based on specific functions. The names of the five centers will be Motorcycle Development Center, Automobile Development Center, Power Products Development Center, Aero Engine Development Center, and Basic Technology Research Center.
Each center will have separate offices for planning, product development, technology development and administration with clearly defined roles.
Primary authority to make operational decisions, currently held by the head of each center, will be delegated to the head of each office within each center to achieve an autonomous operational structure through which each office can make more decisions.
A flat and less-layered organizational structure will be employed to ensure smooth and direct communications between the head of the office and each associate.
The product development function of the Automobile Development Center will be further separated between the Honda brand and Acura brand.

This structural change is a part of Honda�s continuous effort to strengthen the core characteristics that makes Honda unique, and its purpose is to continue creating advanced and creative technologies and products that are unique to Honda, which in turn will enable Honda to continue to be a company that society wants to exist.