Honda Motor : Summary of Honda CEO Speech on Organizational Changes

In light of the acceleration of electrification, we have been making changes throughout our global automobile production network based on our direction to 'optimize production allocation and production capacity on a global basis.' In fact, we have already been making steady progress in Thailand, Japan and Brazil.

Moreover, in the midst of major changes we continue to face in each region, including changes in market trends and tightening of environmental regulations, we are making progress in establishing a production system and capability which will enable us to accelerate electrification of our products, particularly in China, the U.S. and Japan, where high production volume is expected.

On the other hand, in Europe where it is essential for us to enhance our lineup of electrified vehicles, we determined that it is difficult to do so with locally produced products in the region from the perspective of competitiveness and other factors. Therefore, we decided to fully utilize the global production resources of Honda to deliver highly-competitive products to the European market.

In particular, based on the direction of strengthening inter-regional collaboration that I mentioned earlier, we will strategically strengthen the foundation of our business in Europe, including electrification, through collaboration with our operations in China, where the direction of environmental regulations is similar to that of Europe. This will include utilizing a common product lineup.

Moreover, our automobile production plant in the U.K., Honda of the U.K. Manufacturing or HUM for short, is currently supplying one model, the Civic Hatchback, to global markets. However, with due consideration of the global production allocation for the future, we intend to produce it in other regions including North America, starting from the next-generation model.

Based on those evaluations, we will begin consultation with associates in the direction toward discontinuing automobile production at HUM in 2021. Moreover, as with the case of HUM, we made a decision to discontinue the production of the current version of the Civic Sedan at our automobile production plant in Turkey in 2021, as well.

In Europe, where CAFE regulations continue to be more stringent, we will strengthen the Honda brand as a leading company in addressing environmental challenges by attaining our goal to 'make two-thirds of our automobile sales electrified' by 2025, which is 5 years ahead of our current global target year of 2030.