Honda 2014 Annual Report Download - page 36

Power Product and Other Businesses
The power product business’ overall strategic direction is to proactively propose
new and useful ideas that will bring joy to customers worldwide. The segment’s
core technological initiatives focus primarily on (1) creating new products and
technologies for developed countries, and (2) developing products for expanding
markets in the emerging countries.
Among key technological achievements, Honda launched the HSS760n com-
pact rotary snowblower equipped with an auger (snow-throwing unit) with a con-
centric, simultaneous forward, reverse mechanism that prevents the machine from
riding up on top of hardened snow. Also launched was the HSL2511 large-sized
snowblower equipped with a function for adjusting the angling of the auger,
among other features. In the general-purpose engine category, the GP160H and
GP200H engines were developed for sale in emerging markets. These engines
were designed to share as many water pump and generator components pro-
duced in China as possible in order to lower their price and make them affordable
to many more customers.
R&D expenses in this segment amounted to ¥29.6 billion in the year ended
March 31, 2014.
Fundamental Research
Major initiatives in the fundamental research area included a joint trial research
project for Honda’s walking assist device in collaboration with a leading U.S. reha-
bilitation institute in Chicago. Honda’s walking assist devices are being developed
to help people who have walking impairments due to illness, injuries or weakened
leg muscles due to old age, to regain bipedal mobility.
Honda also unveiled a UNI-CUB ß model of its UNI-CUB Personal Mobility
Device, which enables riders to move at walking speed simply by shifting their
weight and leaning in the direction they would like to go. This beta model was
developed based on data and user feedback collected from trial demonstrations
that began in June 2012.
Please note that expenses incurred in fundamental research are allocated
among each business segment.
Patents and Licenses
As of March 31, 2014, Honda owned more than 20,800 patents in Japan and
more than 25,900 patents abroad. Honda also had applications pending for more
than 8,800 patents in Japan and for more than 15,700 patents abroad. While
Honda considers that, in the aggregate, Honda’s patents are important, it does
not consider any one of such patents, or any related group of them, to be of such
importance that the expiration or termination thereof would materially affect
Honda’s business.
Capital Expenditures
Capital expenditures in fiscal 2014 were applied to the introduction of new models,
as well as the improvement, streamlining and modernization of production facilities,
and improvement of sales and R&D facilities.
Total capital expenditures for the year amounted to ¥1,854.0 billion, increased
by ¥467.2 billion from the previous year. Also, total capital expenditures, exclud-
ing property on operating leases, for the year amounted to ¥726.1 billion,
increased by ¥132.5 billion from the previous year. Spending by business
segment is shown below.
Yen (millions)
Fiscal years ended March 31 2013 2014
Increase
(Decrease)
Motorcycle Business ¥ 73,513 ¥ 55,575 ¥(17,938)
Automobile Business 505,045 656,412 151,367
Financial Services Business 793,669 1,128,460 334,791
Financial Services Business (Excluding
Property on Operating Leases) 551 620 69
Power Product and Other Businesses 14,519 13,580 (939)
Total ¥1,386,746 ¥1,854,027 ¥467,281
Total (Excluding Property on
Operating Leases) ¥ 593,628 ¥ 726,187 ¥132,559
Note: Intangible assets are not included in the table above.
In Motorcycle business, we made capital expenditures of ¥55,575 million in the
fiscal year ended March 31, 2014. Funds were allocated to the introduction of new
models, as well as the improvement, streamlining and modernization of production
facilities, and improvement of sales and R&D facilities.
In Automobile business, we made capital expenditures of ¥656,412 million in
the fiscal year ended March 31, 2014. Funds were allocated to the introduction of
new models, as well as the improvement, streamlining and modernization of pro-
duction facilities, and improvement of sales and R&D facilities. A new auto plant in
Yorii-machi, Osato-gun, Saitama, Japan completed construction of its facilities for
production in July 2013. A second auto plant of Honda De Mexico, S.A. de C.V.,
which is one of the Company’s consolidated subsidiaries, completed construction
of facilities for production in February 2014. A second auto plant of Honda Cars
India Limited, which is one of the Company’s consolidated subsidiaries, completed
construction of facilities for production in February 2014.
In Financial services business, capital expenditures excluding property on oper-
ating leases amounted to ¥620 million in the fiscal year ended March 31, 2014,
while capital expenditures for property on operating leases were ¥1,127,840
million. Capital expenditures in Power products and other businesses in the fiscal
Honda Motor Co., Ltd. Annual Report 2014 35
6 Financial Section
1 The Power of Dreams
2 Financial Highlights
3 To Our Shareholders
4 Review of Operations
5 Corporate Governance
7
Investor Relations
Information
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