Honda has been run through the mill over the past year, as many millions of its cars were found to have used poorly manufactured airbags from Takata, which in some instances have been found to be fatally dangerous. In the wake of the recalls that have taken place and the promise of more vigilance in future when it comes to the company’s safety equipment, Honda has appointed a new CEO from inside the company, with hopes that he can steer it out of the murky waters it currently resides in.
Takahiro Hachigo has spent his whole adult life at the company, so knows it’s ins and outs very well. While he has yet to make any announcements of plans about how to deal with this crisis, it’s thought likely that he’ll begin taking steps in the near future. Chances are any he does make, will be much larger than the stopgaps made so far, which have been just minor adjustments, such as delaying new models and adding extra post production checks, as per Bloomberg.
In contrast, Hachigo will need to make some bold moves to reform the company’s practices if he wants to really put Honda back on the track to recovery. He may also need to take a firm stance to distance his company from Takata and potentially even go on the offensive. The airbag maker has recently begun trying to pass the buck on its tens of millions of defective products, by suggesting that their implementation and installation may have been the cause of the problem.
At this time, that seems unlikely as it’s the housing of the airbag which seems to be causing the most problems – warping under high heat and humidity, and exploding upon impact rather than rupturing.
However, Honda will need to be careful not to alienate Takata too much, as despite its egregious safety record over the past decade, it is the only airbag manufacturer capable of fulfilling the orders for the 10s of millions of new airbags which need to be created. It is also swamped with orders from new car builds, so keeping it sweet enough to continue receiving airbags, whilst not allying Honda with it, makes Hachigo’s job a lot harder.
With regards to Honda’s customer base, Hachigo will also need to try and win back customers that were put off by the poor safety record of the airbags and the fact that so many of their vehicles needed to be recalled. The main reason for the last president and CEO, Takanobu Ito, stepped down, is thought to be because he failed to bring the company to a point where it could sell the six million cars a year he promised by 2017.
That still seems unlikely at this stage, but if the new CEO can turn things around and hit that target, it would cement his position in the long run.