Honda makes moves, but will stay in California

Ohio office handles some, not all, business services

Ohio office handles some, not all, business services

The three largest Japanese automakers are similar in a lot of ways. But when it comes to managing North America, Honda Motor Co. is following a different drummer.

Toyota and Nissan are through with suburban Los Angeles for their North American headquarters, but Honda is not.

While Honda has brought together 600 employees and executives in Ohio, the company still has 2,500 employees in California with no intention of moving them, says Jeffrey Smith, chief spokesman for Honda North America.

“We are investing in California, not divesting,” Smith says.

Honda recently completed renovations to its headquarters in Torrance, Calif., modernizing the company cafeteria that feeds 2,500 sales and marketing employees daily. It also built an interactive display in the headquarters lobby to let visitors experience the Honda and Acura brands, Smith says.

Suspicions that Honda would follow Nissan and Toyota entirely away from the coast — emboldened by Mercedes-Benz USA’s relocation this year from New Jersey to Atlanta — have not been borne out.

Smith says: “The current organization is working very well, and we have no plans to change our current direction.”

A little over a year ago, Honda quietly opened an office building on the grounds of its big vehicle assembly plant in Marysville, Ohio, that illustrates just how different its thinking is from that of Toyota and Nissan.

In addition to a museum that is open to the public, the Honda Heritage Center also now houses 600 employees, including executives who manage some — but not all — business functions for North America. Those employees were gathered over the past two years from several existing Honda sites in an effort to coordinate services and planning for a growing list of Honda operations.

Those operations include the workaday aspects of running a complex automaker: human resources, legal affairs, production planning, finance, purchasing and information systems. But the more high-profile business of sales and marketing for the Honda and Acura brands remains firmly rooted in Torrance, Smith says.

That contrasts with Toyota, now one year away from completing its centralized North American headquarters building near Dallas. The first 400 Toyota staffers have relocated from Los Angeles.

Nissan relocated from Southern California to Nashville in 2006 amid some industry skepticism that it was making a mistake. Since then, Nissan North America’s U.S. market share has grown from 6.3 percent (2005) to 8.5 percent (2015), and its Nashville headcount has grown to 1,700, up from 1,300 when the company was headquartered in suburban Los Angeles.

Unlike Nissan, Honda doesn’t plan to relocate its entire management team.

In early 2013, Honda announced it would move four dozen employees from Torrance to Marysville to join a new entity called Honda North America Services. Among those expected to relocate was Honda’s top North American executive at the time, Tetsuo Iwamura. But one year later, Iwamura moved to a new position, and his successor, Takuji Yamada, chose not to have his office full-time in Ohio.

Yamada alternates between Torrance and the Ohio office. Other North American management leaders also alternate between two locations. The Marysville location also serves as a meeting point for North American strategy planning sessions, with executives coming in from diverse offices.

Smith notes that the 600 employees in the Heritage Center are only part of the newer corporate services team. Another 600 members of the group work at other Honda sites around Ohio. And 250 more work in offices in California, Detroit, New York, Washington, D.C., and elsewhere.

“We’re really looking for ways to operate the most efficiently as we continue growing,” Smith says.

The role of the Heritage Center team is not to consolidate management in a single spot, he says, but to serve as a “link” to the various Honda operations around the country, “to work as one Honda team.”

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