The "Green" Market Creates an Overseas Sales Network for Power Products
Following the development of Honda's 1953 Type H engine, the company steadily expanded its line of general-purpose engines by launching the Type T and VN models. The field of complete products saw considerable activity also, with market expansion significantly aided by the F150 tiller (released in 1959) and E40 generator (1964), along with several pumps and outboard marine engines.
The high-quality, high-performance HR21 walk-behind lawn mower, developed in order to expand Honda’s power product market worldwide.
Honda began the full-scale exportation of tiller products to France in 1963 as part of an aggressive strategy to cultivate the market for power products overseas. Yet, despite the recognition of their high quality and superior durability, Honda power products lacked the cost advantage they needed to compete in a price-driven market. As a result, Honda could not yet expand its power product operations globally.
The ME engine (G150/200) introduced in 1977 represented Honda's effort to develop a new family of powerplants that could maintain the high quality associated with Honda products yet be affordable enough to compete in the global market. Named ME (Million Engine) as an expression of the company's high sales expectations, the product was given a challenging mission: to help sell one million units and build the foundation on which Honda could establish Power Products as a third major operation.
Worldwide annual sales of power products were around 20 million units during the 1970s, with the so-called "green" market (lawn mowers) accounting for 8.5 million units. Therefore, to any industry player lawn mowers represented a very appealing and potentially profitable market.
Honda's power-products operations during that period were limited to sales of complete machines in Japan and France. Moreover, the company had few sales bases in the U.S. Therefore, to increase the sales of its power products from less than 300,000 units to over one million, Honda would have to establish a worldwide sales network covering these untapped regions. Accordingly, as the principal category with which to build this vast network, Honda chose the commandingly large market of lawn mowers.