MARYSVILLE, Ohio (AP) -- A quarter-century ago, Honda Motor Co. would have been on few lists of



MARYSVILLE, Ohio (AP) -- A quarter-century ago, Honda Motor Co. would have been on few lists of companies poised to alter the American automotive industry.
Facing an uncertain future, founder Soichiro Honda decided in the late 1970s to invest heavily in manufacturing facilities in the United States, looking to join German-automaker Volkswagen as the only foreign transplants building vehicles on American soil.
Honda's venture was considered risky -- even a make-or-break proposition -- given its size and standing, but the company never wavered.
The resulting operations in central Ohio were the start of a revolution that would far surpass VW's endeavor, which ended in 1988, and change the landscape of American carmaking.
Industry observers say Honda's flexible and efficient manufacturing systems -- which were followed in the United States by Nissan and Toyota -- caused America's Big Three automakers to take notice and helped foster quality improvements industrywide.
"From a manufacturing perspective, GM, Ford and even DaimlerChrysler to an extent have instituted a lot of lessons learned from Honda and Toyota," said Mike Wall, an industry analyst with CSM Worldwide. "Honda's product isn't always sexy, but it's high-quality and well-produced."
Quality surveys
David Cole, chairman of the Center for Automotive Research in Ann Arbor, Mich., said the primary reason vehicles from Honda score consistently high in quality surveys is that the company made that one of its goals -- along with affordability and fuel economy -- at the outset in the United States.
In the latest J.D. Power and Associates' vehicle dependability study, Honda ranked second, slightly behind Toyota, among the 16 automakers surveyed.
"They developed quality systems, and they had very good people who were trained carefully," Cole said. "If you're going into any market with a new product, you basically have to differentiate yours from those already there. They made quality a focal point, and they made it work."
It all started 25 years ago, in September 1979, in this unassuming community about 30 miles northwest of Columbus, where Honda initially built only motorcycles. But negotiations were long under way between then-Gov. Jim Rhodes and Honda's top brass in Tokyo for something grander.
The year after it began building motorcycles in Marysville, creating 64 jobs, Honda announced plans to begin producing cars at an adjacent plant, which rolled out the first Ohio-built Accord on Nov. 1, 1982.
Some savvy salesmanship by Rhodes, along with $27 million in direct incentives from the state, were the keys to luring Honda, observers say.
"Gov. Rhodes was something of a maverick, and so was Honda," said James M. Rubenstein, a professor at Miami (Ohio) University who has written two books on innovation and change in the automotive industry.
"A lot of people told Honda it was a big gamble to rely on American workers and American materials, but they took a flier and it paid off."
Employment
Since the late 1970s, the original 60-plus payroll has grown to more than 16,000 in Ohio, where Honda makes vehicles for both the Honda and Acura nameplates as well as the engines that power them. Its capital investment in Ohio since 1979 exceeds $6 billion.
Honda also builds the Pilot sport utility vehicle and Odyssey minivan at a plant in Lincoln, Ala., that began production in November 2001. With the recent addition of a new assembly line, Lincoln's employment level is expected to reach 4,300 by year's end. The automaker's North American headquarters are in Torrance, Calif.
The U.S. market has emerged as its No. 1 sales territory, accounting for 47 percent of worldwide volume last year, and of the 1.35 million cars and trucks Honda sold in the United States last year, roughly 63 percent were made in America.
In an interview with The Associated Press, Koki Hirashima, president of Honda of America Manufacturing Inc., said he'd like to see U.S. sales grow to 1.6 million or 1.7 million in the next five years, though he declined to discuss specific plans for growth or new vehicles.
Hirashima said he's bullish on prospects for the U.S. industry, but he acknowledged the intense competition and increasing number of choices for consumers.
Fueling the fierce battle for U.S. market share is the growing list of foreign transplants making vehicles in the United States for American tastes.
"We still need to make more effort in many areas," said Hirashima, who wears white coveralls each day at the factory and office like all Honda workers.
"At first we had a big dream and a challenging spirit. In the future, I'm more worried about can we expect that same challenging spirit. Maybe we've grown so big, many people will forget to challenge the next step."

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