The seven states in which Honda mainly operates are: Ohio, Alabama, California, Georgia, Indiana, North Carolina and South Carolina. Overall, Honda has created more than 165,000 manufacturing and retail jobs in these states since American Honda Motor Company was first founded in Torrance, California, where their headquarters operations are located, in 1959. In Ohio, Alabama, Georgia and Indiana—automotive manufacturing and research and development operations occur. In South Carolina—engine manufacturing and other research and development operations occur, while in North Carolina—engine manufacturing, other research and development operations, and aerospace operations take place. Although these operations may seem to only benefit the states they’re located, but these operations have a ripple effect, or spin-off, which creates more jobs within the U.S. economy.
In 2006, when it was announced that a manufacturing plant for Honda Civics would open in Indiana, the economic effect of this new plant was not projected to only benefit Indiana; it was projected to be more economically beneficial within the neighboring states, such as Kentucky and Ohio, as well. It was predicted in a study compiled by the Center for Automotive Research for Honda Motor Company that in 2010, there would be a total of 6,480 jobs created in Indiana and an overall 12,840 jobs would be added to the U.S. economy from the new manufacturing plant. This is a great example of the effects one of Honda’s operations in a single state, can have on surrounding states. Now that the factory has been built, it is said that because of every one job at that plant, an additional 5.4 jobs have been created nationwide. With all of the jobs and operations of Honda Motor Company in the U.S., additional jobs have been added to the national economy because of the outside workers Honda hires to transport manufactured parts to assembly plants and outside research facilities that investigate new technologies. Honda has not only had an effect on their seven, main operation states, but they’ve also impacted the United States as a whole.
Nationally, Honda has created 233,701, direct and intermediate, private sector jobs in Honda operations and paid out more than $17 billion in wages and salaries to workers. In turn, some of the $17 million is spent in the economy and beneficial to its growth. Also, for every one job at Honda factories or its dealerships, there are an additional 1.9 spin-off jobs in the economy. That means that an additional 133,982 jobs created from that spin-off has been created in the U.S. Overall, Honda has created a total of 367,683 private sector jobs from all of its operations in the U.S. On Honda’s ‘Honda in America’ website, facts and statistics about their U.S. operations are listed and explanations of the effects Honda’s U.S. operations has had on America’s economy from 1959 to 2011 are there too. A shocking statistic on the site is that from the 7,000+ Honda automotive manufacturing jobs, there are an additional 2,000+ jobs in the manufacturing industry of other products, such as plastics and metals, to be used in Honda products. The manufacturing processes that Honda utilizes have not only created improvements to their operations. These processes have contributed to improvements in productivity of the automotive and other major U.S. industries that Honda works in, also. Honda also uses its U.S. plants to export products and parts to other countries. In the five years recorded, which ended in 2007, Honda exported nearly $200 million in power equipment and multi-purpose engine products to over 30 countries. Unfortunately, since these plants that export these products or located in the Carolinas, the impact of these exports are mainly felt in the surrounding areas and not the U.S. economy as a whole. The export of Honda vehicles from the U.S. since 1987 has totaled over one million. Honda has been able to expand and not cut any American jobs since the Honda brand has grown in popularity.
With such a strong company and the direct and indirect employment of over 300,000 people, it’s no surprise that Honda has been able to not lay-off workers in the 50+ years it’s been operational in the U.S. Indirect employment from Honda’s more than 50 suppliers has created expansion in those suppliers’ businesses resulting in thousands of jobs being created by the indirect actions of the American Honda Motor Company. Another fact is that 85% of all Honda and Acura vehicles sold in the U.S. are manufactured in the U.S. creating sustainable jobs in a country where unemployment is still high. Since Honda has produced vehicles with the fewest defects, less money has been spent on fixing the problems. In turn, more money can be used towards the advancement of technologies and the expansion of Honda in America potentially created thousands of jobs.
Honda’s U.S. operations has resulted in a significant, positive impact on our economy. Without those operations, hundreds of thousands of jobs would have never entered the U.S. Since Honda has created thousands of jobs from spin-off, other industrial companies have expanded and created more U.S. jobs. From Honda’s ingenious strategizing, other companies could learn from a motor company that cleanly executes its operations to have the biggest impact on the economies it influences.
Works Cited:
"Homepage." Honda in America. Web. 28 Nov. 2012.
"Honda in America - Economic Impact Study." Honda in America - Economic Impact Study. Web. 28 Nov. 2012.
"Parts & Suppliers." Honda in America. Web. 30 Nov. 2012.
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