Honda will go it alone on fuel-cell cars unless GM comes knocking

Tokyo August 5, 2005; Kaho Shimizu writing for the Japan Times reported that Honda Motor Co. will work alone to develop fuel-cell cars but is open to the idea of joint research with General Motors Corp., President Takeo Fukui said in an interview Thursday.

"We are not counting on other automakers" to help develop the fuel-cell cars, Fukui said, denying a report in the Yomiuri Shimbun earlier in the day that Honda, GM and BMW had agreed to work together to develop hydrogen-powered vehicle technology so the cars would be more marketable.

The daily said the joint research by the three automakers is aimed at reducing the high cost of building the hydrogen-fed vehicles, believed to exceed 100 million yen per car.

But Honda denied the report, saying the automaker is participating in the Liquid Hydrogen Consortium with the three carmakers, but it is only a study group of engineers and will not go beyond information exchanges.

Fukui said that despite high development costs, there will be no tieups in the field of fuel-cell cars unless the automaker enters the mass-production stage.

But Honda is keeping the door open to GM.

"We hope we can cooperate with GM in state-of-the-art technologies and we are willing to talk if GM is interested in the idea," Fukui said.

Honda has been supplying its V-6 engines to GM, shipping 87,000 units in 2004, the only connection Honda has with the U.S. automaker.

Fukui said he wanted to have stronger ties with America's largest automaker.

Fukui also said North America will continue to be Honda's major revenue source in its drive to boost worldwide car sales by 23.4 percent to 4 million vehicles in fiscal 2007 from fiscal 2004 under a three-year business plan through the end of March 2008.

More than half of Honda's revenue is generated in North America.

Honda recently announced it will launch the Fit compact as an entry model in North America next spring, expanding its vehicle lineup there to meet growing demand.

"We need to attract a wider range of customers," Fukui said, adding that the Fit will replace the Civic series as the entry model as the Civics are scheduled to be completely remodeled in the fall and launched in a higher segment.

Honda is expanding its North American lineup to respond to growing demand for the models in the segments where Honda has been weak.

The launch of the Ridgeline light truck in March is part of the expansion.