Honda’s New Strategy: Open Innovation

Honda’s New Strategy: Open Innovation

By Amanda Elliott

There’s a new trend for the automotive industry – and it’s not autonomous. It’s collaborative.

Honda is a company notorious for internal R&D spending.  In fact, they outspent Toyota, the leading R&D spender in Japanese automotives. Now, Honda has shifted its focus externally to improve it’s profit margins.

“The passion of Honda engineers alone can no longer underpin our efforts,” said Takahiro Hachigo, Honda President. 

Honda Partners with Startups Worldwide with hubs in Tokyo and Silicon Valley:

Open innovation is a key component of Honda’s strategy. In 2015, Honda unveiled the Honda Silicon Valley Lab to work with startups, but the partnerships didn’t end in Silicon Valley. At a recent tech conference, CEATEC (Combined Exhibition of Advanced Technologies), Honda unveiled a micro commuter car collaboration using an open innovation model and with Kabuku, a Tokyo-based startup specializing in 3D printing.

This was just one of Honda’s outreach efforts to collaborate with startups in Tokyo, a common trend for Japanese corporations who are said to expand their research and development within their country in the fiscal year of 2016 according to a Nikkei survey. Honda just announced that it will spearhead it’s Artificial Intelligence R&D in Tokyo and is hoping to find talent outside of the automotive industry.

In March, Honda announced that it was partnering with the startup community in Boston and also seeking out crowdfunding through the Israeli tech community.

General Motors and Honda Partnership:

Honda is seeking out partnerships beyond startups. They are also partnering with other automakers like General Motors to shift energy consumption from gas to hydrogen fuel cells. By 2025, the two automakers hope “to setup a joint factory to develop fuel-cell stacks.” This effort is supported by the Japanese government, which is propelling a hydrogen fuel environment.

As they invest and partner with startups and other automotive companies and embraces emerging technology like Artificial Intelligence and 3D printing, Honda has seen positive growth in its various markets, particularly in Europe where is saw an increase of 31 percent in sales compared to 2015. 

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