A Young Boy Who Loves to Tinker with Machines Later Starts
His Own Business
Soichiro Honda was born in 1906 into a family of blacksmiths who later started selling bicycles. As a youngster, he was already deeply interested in all kinds of machines, such as the yakitama engine*1 which powered rice milling machines at that time. He became fascinated with automobiles, when one came trundling through the village where he was born and raised (Komyo-village, Iwata-country, later, Tenryu Ward in the City of Hamamatsu, Shizuoka Prefecture).
After graduating from a local elementary school, at the age of 15, Mr. Honda moved to Tokyo of his own volition to work for Art Shokai, an automobile service station he’d learned about from an advertisement he saw in his father’s bicycle trade magazine, Ringyo no Sekai (the World of Bicycle Business).
Young Mr. Honda became a live-in apprentice, working hard, learning everything he could, and constantly demonstrating his intense love of working on machines. When the owner of Art Shokai, Mr. Ikuzo Sakakibara, took on the challenge of building a racing car, Mr. Honda helped build a special machine with a second-hand biplane engine mounted on a chassis of an American car. He came up with many of his own ideas, and dexterously made custom parts, earning him the lasting trust of Mr. Sakakibara.
One day young Mr. Honda was sent on a solo business trip to Morioka, in the northern part of Japan, for repair work on a fire engine. Initially, the members of the fire station were disappointed to see that a teenage boy had arrived on their doorstep, but this disappointment turned to joy when he disassembled the fire engine without talking too much and successfully repaired it. This experience taught young Mr. Honda that all are equal in the presence of technology.
At age 21, Mr. Honda was approved to start up an independent business under the name of Art Shokai and established his own automobile service station, the Hamamatsu Branch of Art Shokai. This began his career as a business manager. He not only earned a reputation for his repair skills, but was also called the “Edison of Hamamatsu” for his inventiveness. For example, he installed more powerful water pumps on fire trucks, remodeled buses to increase passenger capacity and invented a lift that eliminated the need for mechanics to crawl under the vehicle for repair.
Mr. Honda soon found himself dissatisfied with simply repairing things made by others and, in 1936, he decided to begin a manufacturing business. Mr. Honda then founded Tokai Seiki Heavy Industries to manufacture piston rings for engines. However, he experienced a series of technical failures in the development, and in no time, the company ran out of funds and faced a tough predicament.
Mr. Honda keenly realized that he was powerless without knowledge, so at the age of 30, he began auditing night classes at the Hamamatsu Technical High School (later, the Faculty of Engineering of Shizuoka University), voraciously absorbing the knowledge and technology of metallurgy.
When his hard work finally paid off and prototypes of piston rings were developed successfully, Mr. Honda handed over the Hamamatsu Branch of Art Shokai to one of his apprentices and assumed the position of president of Tokai Seiki Heavy Industries. He devoted everything he had and, at its peak, the company grew to the scale of approximately 2,000 associates.
However, Mr. Honda and his business were swallowed up by the stormy waves of the times. When World War II broke out in 1941, the management of Tokai Seiki Heavy Industries was placed under government control, and many of the production associates were drafted to serve in the military. Finally, just before the war ended, the factory was destroyed in an air raid, which was followed by a devastating earthquake.
- An internal combustion engine that injected fuel into its heated combustion chamber, called a yakidama. Because of its simple and inexpensive construction, it was used widely in Japan around the turn of the 20th century for various machines including rice milling machines, lumbering machines, pumps and small ships.
Art Shokai Hamamatsu Branch
A Shy Young Man Awakens to His Business Acumen
Meanwhile, Mr. Takeo Fujisawa, who would eventually partner with Mr. Honda, was born in Koishikawa, Tokyo in 1910. At the age of 23, he started working as a salesperson for Mitsuwa Shokai, a steel distributor located in Nihonbashi, Tokyo, selling steel materials to factories.
Mr. Fujisawa loved literature and was the type of person who deeply pondered over things, and people thought he was not particularly good at socializing. However, as he accumulated work experience, his hidden talents began to bloom, and he became the company’s top salesperson. Mr. Fujisawa invariably treated his customers with his whole heart and soul. When there was a chance that a delivery deadline could not be met, he never made excuses. Rather, he gave an honest reason, apologized for the delay and offered solutions. This kind of care for his customers further increased Mr. Fujisawa’s credibility.
In the meantime, handling steel materials, for which prices fluctuated wildly, required quite a bit of speculative flair, which Mr. Fujisawa gained through his nine years of experience in this highly competitive business.
When the owner of the company was drafted into military service, he put Mr. Fujisawa in charge of the business. However, around this time, Mr. Fujisawa was growing dissatisfied with the intermediary business and looked into the possibility of starting up his own manufacturing business. In 1939, while continuing his job managing Mitsuwa Shokai, Mr. Fujisawa established Nippon Kiko Kenkyujo, a company that manufactured cutting tools. This experience in starting up a manufacturing company would be put to good use after the war.
Although Mr. Honda and Mr. Fujisawa never crossed paths during the war years, they both supplied critical components to the same military aircraft manufacturer. This distant relationship between the two foreshadowed the fateful encounter that was to follow.
Making a Fresh Start After the War Ended
When the war finally ended on August 15, 1945, Mr. Honda sold his company and declared that he would take an extended hiatus from work. Although many of the people around him thought he was living an idle life and not working at all, he was in fact searching for clues to help him identify the changes coming in the new era.
Numerous anecdotes about Mr. Honda during this period have been passed down. While developing and prototyping a salt making machine and a rotary loom during the daytime, in the evenings, he gathered with friends, drinking homemade alcoholic drinks. Mr. Honda asked his wife, Ms. Sachi Honda, to add some roasted barley and cedar leaves to make it look more like whiskey.
Nearly a year later, in 1946, Mr. Honda ended his work hiatus, with an idea to start a business with engine-powered mobility products.
While Japan was still in the wake of wartime devastation, Mr. Honda established the Honda Technical Research Institute on September 1, 1946.
His business idea was to attach a small generator engine designed to power wireless radios for the army to a bicycle for use as an auxiliary power source. At the time, bicycles were the main mode of transportation for the people of Japan, and they were also a means of transporting a large volume of cargo. Mr. Honda thought bicycles with an auxiliary power unit would be helpful for and appreciated by people.
Mr. Honda bought approximately 500 units of the wireless radio generator engine. At the time, it was common practice for bicycle shops to install auxiliary engines and related parts supplied by engine suppliers on existing bicycles and sell them at their own shops. However, Mr. Honda didn’t take the easy way out by simply adding drivetrain components and selling them to bicycle shops. Instead, he completely disassembled each engine, refined it, then reassembled and installed it on a bicycle, and conducted a test ride before putting it on the market. Due to their affordable price, bicycles with an auxiliary engine soon became extremely popular and the Honda auxiliary engines earned a nickname, “bata-bata,” for the exhaust sound they made.
With a passion for monozukuri (the art of making things), Mr. Honda had succeeded with his own parts manufacturing business. However, he had to give it all up and make a fresh start. This experience led to the starting point of Honda – a desire to help people and society in the fields of technology, where Honda excelled.
In 1947, Kiyoshi Kawashima (who later became the second president of Honda) graduated from Hamamatsu National College of Technology and immediately joined Honda, which readied company to pursue the challenge of developing its original engines. The first product to carry the Honda name, the Honda A-Type auxiliary bicycle engine, was introduced to the market in 1947. A wide variety of ideas were incorporated into this engine, but what is noteworthy is that, at that point, Honda was already taking on challenges toward the mass production of its own engines.
Sand casting was easier, considerably less expensive, and would have been a more reasonable choice in light of production volume at the time. However, Mr. Honda insisted, “No matter what others are doing, we go with die casting!” With an eye toward future mass production, Mr. Honda dared to choose die casting. His choice was also based on a certain rationality of production. Die casting is a relatively simple process without an issue of metal shavings or waste resulting from machining. It requires less materials, and the finished work looks more beautiful than sand casting. That said, die casting was much more expensive. One die tool would cost upward of 500,000 yen, equivalent to approximately 10 million yen in terms of current monetary value.
With limited funds, Honda engineers began making dies of their own by fully utilizing tools they already had. Although only a few casting dies were made for the earlier versions of the A-Type engine, Honda engineers kept working diligently and made dies for cylinders, cylinder heads, crankcases, connecting rods and rotary valve seats. For later versions of the A-Type engine, the majority of the parts were die-cast parts.
The following year, in 1948, the engine factory was upgraded with a full belt conveyor system. Honda A-Type engines quickly became so popular that brokers from all over Japan came to buy them. Also, around this time, Honda’s success spurred the emergence of more than 40 manufacturers of pon-pons (a local nickname used in Hamamatsu for bicycles with auxiliary engines), both large and small, in Hamamatsu alone.
Meanwhile, in the waning days of World War II, Mr. Fujisawa made a decision to move his factory, which had barely escaped air raids, from Tokyo to Fukushima. However, the war ended the very same day he moved his machines to Fukushima.
Seeing burned out ruins all over the country, Mr. Fujisawa was convinced that housing construction needs would soon surge in Japan. So, he decided to get ahead of the game by buying a plot of mountain forest and starting a lumber business in Fukushima. In the meantime, based on his realization that the post-war increase in lumber demand would be transient and end once society was restored, Mr. Fujisawa began further exploration into future business opportunities.
A-Type (bicycle auxiliary engine) demonstration event (1947)
Founding of Honda Motor Co. Ltd.:
A Full-Fledged Start as a Motorcycle Manufacturer
Honda Motor Co., Ltd. established in 1948 (photo shows Yamashita Plant in 1952)
Here is a summary of the earliest days of Honda: After coming out of an extended work hiatus, Mr. Honda established the Honda Technical Research Institute in 1946, at about the same time as when he first came upon the batch of small generator engines for wireless radios.
The following description of the early days of Honda was included in the first pages of the company history published on the seventh anniversary of the founding of Honda Motor Co., Ltd.:
“In the late summer of 1946, a modestly-sized wooden building was newly erected on a scorched ruin located in Yamashita-cho in Hamamatsu where the fronds of the silver grass were swaying in the breeze. There were several old belt-driven lathes inside the building, and there were approximately 10 units of machine tools lined up outside the building. A signboard posted at the entrance of the building said ‘Honda Technical Research Institute,’ and Mr. Honda and 12 or 13 associates were busy working there.”
In October of the same year, the company began sales of auxiliary bicycle engines and immediately undertook the development of its first original engine, namely the Honda A-Type, for which production began in the following year. A number of ambitious challenges were taken on for the production of the A-Type engine, including the use of die-casting and the then-advanced conveyor belt system, with an eye toward future mass production.
Buoyed by the success of the A-Type engine, Mr. Honda founded Honda Motor Co., Ltd. (Honda) in the town of Itaya-machi in Hamamatsu City, on September 24, 1948, with a starting capital of 1 million yen.
Nearly a year later, in August 1949, Honda introduced its first full-fledged motorcycle, the Dream D-Type, developed entirely by Honda, including the motorcycle body frames. Honda rose out of a crowd of small manufacturers of auxiliary bicycle engines and began motorcycle production.
Painted in a then unusual, yet beautiful maroon color, the Dream D-Type caught the eye of every person on the street.
Nearly all of the engine’s major component parts were produced with die-casting, and the channel-type frame was mostly made of stamped steel plate. Honda even developed its own power system to run the assembly line, with the goal of achieving both the high efficiency of mass production and consistently high quality.
In later years, Mr. Kawashima noted that around the time the Dream D-Type was launched, Soichiro Honda began talking about being “number one in the world.”
Dream D-Type (1949)
Dream D-Type in Action
“He had some things I didn’t have.”
The First Encounter of Soichiro Honda and Takeo Fujisawa
Mr. Soichiro Honda and Mr. Takeo Fujisawa, two men with vastly different backgrounds and personalities, met for the first time one sultry summer day in August 1949, a year after the founding of Honda. This encounter was made possible by a mutual acquaintance, Mr. Hiroshi Takeshima, who was in charge of procurement for Nakajima Aircraft Co. during the war (he later became a managing director of Honda).
At that time, Mr. Honda was 42 years of age and Mr. Fujisawa was 38. Mr. Honda was striving to use his own ideas and technologies to create products that help people and society. Believing this would be the doorway to a new era, Mr. Fujisawa wanted to make the business grow bigger. The two men hit it off immediately, and Mr. Fujisawa made the decision to shutter his own company and join forces with Mr. Honda.
Later, both were unanimous in their explanation of the reason for this momentous decision: “He had some things I didn’t have.”
The two men developed strong ties with each other based on their desire to pursue big dreams, putting all their potential into it. This shared ambition marked the true beginning of Honda’s 75-year history. Yet neither of them had even the slightest inkling that their initial dream of becoming the world’s number one motorcycle manufacturer, which seemed to be a leaping ambition, would grow into even bigger dreams.
At the time, Honda’s business was struggling. The success of the Dream D-Type didn’t last too long. For numerous reasons, including a semi-automatic clutch mechanism that required the rider to continue depressing the clutch pedal, an economic recession caused by tightening monetary policies of the United States and competition with rival manufacturers, sales of the Dream Type-D stalled, and Honda quickly faced a difficult situation.
Mr. Fujisawa joined Honda as the managing director and began working enthusiastically, despite numerous setbacks. In 1950, he led an initiative to start exporting the A-Type auxiliary bicycle engines to Taiwan in order to generate funds for immediate operational needs. Then, as a first step toward global expansion, Honda established a sales office and production plant in Tokyo, in 1950 and 1951, respectively.
Taking on the Biggest Challenge of Cultivating Dealers and
Expanding the Sales Network
Kiyoshi Kawashima and Dream E-Type
When the Korean War broke out in June 1950, demand for various supplies and services from the U.S. military in Japan ramped up and began improving the Japanese domestic economy.
In the midst of this economic boom, in October 1951, Honda launched the Dream E-Type equipped with a 146cc 4-stroke OHV (overhead valve) engine. This engine required high-precision machining work and thus increased the cost, but achieved a significant reduction of smoke and noise emissions compared to 2-stroke engines, which would realize excellent commercial potential. Prior to the market launch, the Dream E-Type underwent the “Hakone Pass Test,” which was conducted on a mountain pass in Mt. Hakone, located south of Mt. Fuji. At that time, climbing up the steep hill of the Hakone Pass was a challenge for any Japanese-made motorcycles, but Kiyoshi Kawashima raced up the hill in top gear.
Of the nearly 300 motorcycle dealerships that existed in Japan at the time, only 20 or so carried Honda products. They weren’t exclusive Honda dealers, but consignment dealers, and payments to Honda were often subject to the dealers’ convenience.
When Mr. Honda hit it off with Mr. Fujisawa, he completely entrusted sales with Mr. Fujisawa as well a financial and organizational matters, everything except for matters related to technology. Mr. Fujisawa took on the task of strengthening sales and marketing operations, which were the shortcomings of Honda at the time. Mr. Fujisawa also took over all banking relationships.
Mr. Fujisawa quickly determined that it wasn’t enough to simply improve the inefficiencies of payment collections. The biggest challenge facing Honda was dealer development and the expansion of the sales network. As the first step, Mr. Fujisawa took a labor-intensive approach and sent Honda sales representatives to every part of Japan. They visited motorcycle dealers and bicycle shops within their assigned areas and solicited consent to sell Honda motorcycles on consignment. Upon receipt of advance payments, Honda supplied products, then used the advance payments to continue sending sales representatives to solicit more dealers to carry Honda products. It was as if Honda was paying off debt with new debt.
Thanks to such tireless efforts of Honda sales representatives, sales of the E-Type increased significantly compared to the D-Type whose highest monthly production volume was only about 160 units. The monthly production of the E-Type reached 500 units six months after the market launch, and 2,000 units after one year, when it was upgraded to a three-speed version. Then, three years later, annual sales soared to over 32,000 units.
