Establishing Belgium Honda / 1963

Crossing Boundaries to International Production

Establishing Belgium Honda / 1963

The First Japanese Company to Establish a Factory in the EEC

A team of twelve was put together in May 1962 for the establishment of a new company, Belgium Honda Motor. All became members of the Special Planning Team. Iwamura, who had led the EEC research team, was assigned as manager of Belgium Honda in order to oversee regional production and sales. Okayasu was assigned to the factory manager's post, where he could provide general instructions regarding factory construction and production activities. Iwase was assigned the job of factory administration manager, in which he would facilitate production activities.

The First Japanese Company to Establish a Factory in the EEC

Test-driving the new type of moped (C310) assembled at Belgium Honda. This moped had a hard time winning local acceptance.

To obtain permission from the Japanese government to establish Belgium Honda, members of the Special Planning Team compiled an outline of Belgian corporate activities into a document entitled "Prospectus for the Establishment of a European Factory." Armed with files of materials, the members paid numerous visits day after day to the Ministry of International Trade and Industry, the Ministry of Finance and the Bank of Japan, repeatedly describing the situation to officials.

As with the establishment of American Honda three years earlier, in 1959, the Japanese Government would impose strict restrictions on the removal of foreign currency from the country, citing a lack of foreign currency.

It was apparent that approval would not be an easy thing. Although many Japanese corporations had already established overseas sales bases - American Honda being a noteworthy example - Belgium Honda was to be the very first establishment of a production base overseas. Moreover, such a production base required several times the amount of foreign currency that a sales base did.

The government officials were resolute in their answer. "We cannot give you approval for such a large amount of foreign currency," they said, "unless you have the potential to earn profits commensurate with the investment."

Negotiations pressed on, however, during which Honda was able to gain the government officials" understanding on its intent to launch a production operation in the EEC region. However, the focus of discussion had shifted to the actual amount of foreign currency that could be taken out of Japan. The officials wanted to keep that amount to a minimum, while Honda wanted to secure enough funds to establish a factory in Belgium without any unnecessary problems.

Therefore, even though it was not the full amount Honda had initially requested, approval was given for a total of 75 million Belgian francs. (This was an amount equal to about US$1.5 million at the exchange rate of that time, 20 percent of which was to be investment in kind).

The government officials were not particularly hopeful concerning the outcome of this, the first overseas production operation undertaken by a Japanese company. Even so, they set aside their skepticism and decided they would step back and see what happened.

Belgium Honda acquired a 90,000-square-meter lot for factory construction. This was roughly equal to 10,000 square meters, the size of Saitama Factory's Wako Plant. The factory itself would cover 5,000 square meters, encompassing facilities for welding, painting, assembly, and final inspection.

Moreover, three types of motorcycles would be produced: mopeds, constituting approximately 80 percent of the EEC's motorcycle market; and two Super Cub models, the C100 and C110. The monthly production capacity was to be 10,000 motorcycles, based on a single-shift system. Since mopeds were not then part of the Honda product line, they would be designed at the R&D Center in Japan. "Knockdown" production was planned with all parts to be obtained locally except for the engine and a few others to be imported from Japan.

Completed products were to be sold to the three Benelux nations through Belgium Honda, while European Honda would sell them to the remaining EEC nations.

"You might think that [the monthly production capacity of 10,000 units] was unreasonably small for a market that had yearly demand of more than 2 million motorcycles," Okayasu said. "But it was the first time [that Honda or any Japanese corporation had engaged in overseas production]. So we thought along the lines of rearing a small child and raising it to adulthood." We believed that we should strive to sell as many as we could so that after establishing a track record, we could enlarge the factory for enhanced production capacity."

The Challenging Spirit of Honda

1990 - 1999
  1. The Birth of Twin Ring Motegi / 1997The Birth of Twin Ring Motegi / 1997
  2. Entry to Champ Car Racing / 1994Entry to Champ Car Racing / 1994
  3. Odyssey / 1994Odyssey / 1994
  4. Establishment of Honda Taiyo, Kibo-no-Sato Honda and Honda R&D Taiyo / 1992Establishment of Honda Taiyo, Kibo-no-Sato Honda and Honda R&D Taiyo / 1992
  5. Hosting Hosting "Orei-no-kai" / 1991
  6. The NSX / 1990The NSX / 1990
1980 - 1989
  1. The VTEC Engine / 1989The VTEC Engine / 1989
  2. Honda EV Plus: The Dream of an Electric Vehicle / 1988Honda EV Plus: The Dream of an Electric Vehicle / 1988
  3. An Automated Line for Painting and Coating / 1988An Automated Line for Painting and Coating / 1988
  4. Four-Wheel Steering System (4WS) / 1987Four-Wheel Steering System (4WS) / 1987
  5. The Airbag System / 1987The Airbag System / 1987
  6. The ZE Engine (GX110 / 140 / 240 / 270 / 340 Series) / 1983The ZE Engine (GX110 / 140 / 240 / 270 / 340 Series) / 1983
  7. Formula One Entry / 1983Formula One Entry / 1983
  8. Development of Honda's Franz System Car / 1982Development of Honda's Franz System Car / 1982
  9. The World's Smallest Welding Line / 1982The World's Smallest Welding Line / 1982
  10. Transfer Lines for Modular Components / 1981Transfer Lines for Modular Components / 1981
  11. The Car Navigation System / 1981The Car Navigation System / 1981
  12. City / 1981City / 1981
  13. The F200 The F200 "Komame" Mini-Tiller / 1980
  14. Establishing Honda of America Manufacturing / 1980Establishing Honda of America Manufacturing / 1980
1970 - 1979
  1. The Oval Piston Engine / 1979The Oval Piston Engine / 1979
  2. Returning to the World Motorcycle Grand Prix / 1979Returning to the World Motorcycle Grand Prix / 1979
  3. The HR21 Lawn Mower / 1978The HR21 Lawn Mower / 1978
  4. Creating Hometown Forests / 1977Creating Hometown Forests / 1977
  5. The ME Engine (G100 / 150 / 200 / 300 / 400 Series) / 1977The ME Engine (G100 / 150 / 200 / 300 / 400 Series) / 1977
  6. Introducing the Accord / 1976Introducing the Accord / 1976
  7. CG125 / 1975CG125 / 1975
  8. Establishment of Honda Engineering / 1974Establishment of Honda Engineering / 1974
  9. Company Leaders Honda and Fujisawa Retire; Kawashima Assumes Presidency / 1973Company Leaders Honda and Fujisawa Retire; Kawashima Assumes Presidency / 1973
  10. Announcing the Civic / 1972Announcing the Civic / 1972
  11. Introducing the CVCC / 1972Introducing the CVCC / 1972
  12. Holding All Honda Idea Contests / 1970Holding All Honda Idea Contests / 1970
  13. Launching the Office of Safe Driving Promotional Operations / 1970Launching the Office of Safe Driving Promotional Operations / 1970
1960 - 1969
  1. The Dream CB750 FOUR / 1969The Dream CB750 FOUR / 1969
  2. Launching the Honda 1300 / 1968Launching the Honda 1300 / 1968
  3. The Hondamatic Transmission / 1968The Hondamatic Transmission / 1968
  4. Entering the Auto Market at Last / 1966Entering the Auto Market at Last / 1966
  5. The E300 Portable Generator / 1965The E300 Portable Generator / 1965
  6. Formula One Entry / 1964Formula One Entry / 1964
  7. Kyoto: Celebrating the Company's 15th Anniversary / 1963Kyoto: Celebrating the Company's 15th Anniversary / 1963
  8. Establishing Belgium Honda / 1963Establishing Belgium Honda / 1963
  9. Launching the S360 and T360 / 1962Launching the S360 and T360 / 1962
  10. Employing the Employing the "My Record" Project and Expert Certification / 1960
  11. The R&D Center Goes Independent / 1960The R&D Center Goes Independent / 1960
1950 - 1959
  1. Establishing American Honda Motor Co. / 1959Establishing American Honda Motor Co. / 1959

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