Striving for the fulfillment of its 2030 Vision, Honda has been taking initiatives to solidify its existing business while preparing for future growth. In order to accelerate such initiatives, Honda will make changes to its organizational and operational structures.

(1) Changes to be made to the operational structure for automobile business:

Honda will make changes to the structure of its automobile business operations in Japan in order to further accelerate ongoing initiatives to strengthen its automobile business and realize "strong products, strong monozukuri (the art of manufacturing) and strong businesses" which are essential for the further growth of Honda.

Currently, Honda's automobile business is being operated with a collaborative structure where each area of S-E-D-B (Sales, Engineering/production, Development and Buying/purchasing) maintains autonomy and works in collaboration. Honda will shift from this collaborative structure to a unified structure which integrates S-E-D-B areas. This change will enable Honda to formulate business strategies based on a big-picture view of the entire automobile business and realize product development based on high-precision planning. Moreover, with this unified structure Honda will further advance its monozukuri with an efficient operation which integrates the entire process from development through mass-production.

Specific Changes to be Made

The following organizations/functions will be integrated into Automobile Operations:Honda Motor Co., Ltd. Production Operations, Purchasing Operations and automobile business functions currently being assumed by Business Management Operations.

- Honda R&D Co., Ltd. functions related to the development of automobile products, except for product design and a few other functions.- Honda Engineering Co., Ltd. functions related to the development of automobile manufacturing technologies and the production of automobile manufacturing equipment.

All S-E-D-B areas, currently separated by their respective functions, will be integrated into Automobile Operations and reorganized into the following organizations based on the new process of operations:

- Business Supervisory Unit: responsible for formulating business strategies which will flexibly address changes in the business environment.- Monzoukuri Center: which will develop competitive products by advancing Honda's art of automobile manufacturing.- Production Supervisory Unit: responsible for automobile production as well as the production quality control and high-level equalization of quality on a global basis. - Supply Chain Management Supervisory Unit: This will plan and implement the supply chain optimized for the business strategies.- Sales Supervisory Unit: responsible for formulating and implementing strategies that are unified with regional operations.

The position of Business Unit Officer will be created, with responsibility for supervising the entire process from planning through preparation of mass-production for each model series.With these organizational changes, Production Operations and Purchasing Operations will be disbanded. After Honda Engineering Co., Ltd. transfers some production technology research and development functions to Honda R&D Co., Ltd., it will be absorbed and merged by Honda Motor Co., Ltd.

(2) Changes to be made to the organizational structure of Honda R&D Co., Ltd.:

Honda R&D Co., Ltd. will make changes to its organizational structure to further strengthen its initiatives to "create new value by exploring unknown worlds," which is the original purpose of the establishment of Honda R&D.

Specific Changes to be Made

- Honda R&D will focus on the research and development of new-value products and technologies in some key areas such as new mobility, robotics and energy.- The Innovative Research Excellence center will add research and development functions in some new domains including intelligence technologies, manufacturing/engineering technologies, automated driving and advanced driver-assistive systems.- The Innovative Research Excellence - Power Unit & Energy center will be newly established to integrate research and development functions for power unit and energy technologies for motorcycles, automobiles, power products and business jets. With the establishment of a dedicated research center in the area of power unit technologies, which is a source of Honda's competitive strength, Honda will fully demonstrate the strengths of Honda as a company that has a broad range of technologies and strive to increase the value of its product for the future.- The Automobile Center and Digital Solution Center will be integrated into Honda Motor Co., Ltd. and further strengthened for the realization of "strong products, strong monozukuri and strong businesses."

(3) Changes to be made to the operational structure for connected and MaaS business:

Specific Changes to be Made

In order to further accelerate its ongoing initiatives to create new businesses based on next-generation services, Honda will integrate all functions related to connected services and eMaaS strategy planning, development and business implementation, which are currently being assumed by individual businesses, and newly establish the MaaS Operations within Honda Motor Co., Ltd. The new MaaS Operations will pursue planning and development of new services which will take advantage of Honda's unique strengths in having a broad range of products including motorcycles, automobiles and Life Creation products. At the same time, MaaS Operations will accelerate the commercialization of next-generation services by increasing its decision-making speed.Honda Motor Co., Ltd. also established a new company, effective February 18, 2020, Honda Mobility Solutions Co., Ltd., which will pursue mobility services (MaaS) business in Japan.

About Honda

Honda Motor Co., Ltd. (TSE:7267 / NYSE:HMC / LSE:HNDA) is one of the leading manufacturers of automobiles and power products and the largest manufacture of motorcycles in the world. Honda has always sought to provide genuine satisfaction to people worldwide. The result is more than 120 manufacturing facilities in 30 countries worldwide, producing a wide range of products, including motorcycles, ATVs, generators, marine engines, lawn and garden equipment and automobiles that bring the company into contact with over 19 million customers annually.

For more information, please visit http://world.honda.com.

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