Temple of VTEC Rumors and News - Remarks by Takeo Fukui - Foreign Correspondents Club of Japan

Unfortunately, not much news here. Yes, it's a slow news week.

Good afternoon, ladies and gentlemen. And thank you for your warm welcome.

I want to begin today by boldly suggesting a name change for your organization. As a global business ... facing global challenges ... I think the word "foreign" has become out-dated... not only for Honda, but for any company involved on a global scale.

Honda is a global company ... both in viewpoint and in action. We do business virtually everywhere in the world ... and we build products in more than 60 factories in about 30 different countries. And sometimes I think my job description is to visit every one of them. These are local Honda companies ... making decisions about what is best for their customers ... and for the people working in their companies. In this spirit ... viewing each of us as global citizens working in local areas ... perhaps a more appropriate name would be simply the "Correspondents Club of Japan."

My remarks today also follow a global theme ... focusing on how we, as global companies, must protect the environment. When it comes to greenhouse gas emissions and the declining supply of fossil fuels, national borders are less important. We are all global citizens ... living in the same world ... and sharing a responsibility to preserve it. This kind of global challenge will require urgent and sustained action from every industry, government and region of the world.

Honda is a company with a great passion for providing people with mobility. This year marks the 60th anniversary of the establishment of Honda Motor Company. We began with motorcycles ... because in post-War Japan this was the most efficient way to provide people with transportation. But from the beginning ... our focus has been on creating new and better forms of mobility. This does not only mean going in new directions ... such as humanoid robotics and aviation. It also requires us to further advance existing forms of transportation to create new value for society. This includes the need to realize cleaner, more efficient and sustainable mobility.

To achieve this, we are accelerating our efforts to minimize the environmental footprint of our products and our operations.

The reality is that I am working for Honda today because of an environmental issue. As a university student in the 1960s ... my senior thesis was an analysis of nitrogen dioxide emissions. I had recognized the issue of emissions as an important theme ... and it was probably the first NO2 study in Japan. But I will admit to you now ... one reason I did this study was that I wanted to join Honda. Honda was famous for challenging new things ... and for being the first company in Japan to compete in Formula One racing. This was very exciting to me.

My strategy worked ... and I joined Honda in 1969. But ... ironically ... that was the year Honda quit racing. Our founder, Mr. Soichiro Honda, said that the company needed to focus all of its energy on meeting the clean air challenge. A team of Honda engineers was already working on this when I joined the company.

So, I did go racing ... but it was a different kind of race ... a race to find technology that could improve the quality of the air we breathe.

My first project was emissions research for a catalyst system and I tried a new concept which had never been used before. We were using the trial and error method. Unfortunately, it didn't work and my effort actually made the exhaust more toxic.

Mr. Honda was still running R&D at that time and I remember he began yelling at me. He was passionate about meeting this challenge. And after we failed again, he said: "Don't just think about a system, to treat the exhaust ... like a catalyst. Think about making a clean engine system from the beginning."

Then we began developing an engine that produced fewer emissions without a catalyst. Honda had only been selling cars for a few years. So, I don't know if anyone believed we could do it. But in November 1974 ... I visited the United States for a certification test at a government emissions lab. In that test, Civic became the first vehicle to pass the new standards of the U.S. Clean Air Act based only on engine performance. What I remember most ... was that the government inspector congratulated me for achieving the industry's top rating for fuel economy. This was a big surprise ... because we hadn't even been thinking about fuel efficiency.

Over the past 35 years, we continued working on technologies to make cars cleaner and more efficient. Our efforts helped address one of the major problems associated with fossil fuels ... reducing air pollution. But other challenges remain. Global warming and energy sustainability are now the most critical issues. I want to emphasize that these are not "future" issues ... this is an imminent challenge.

I think everyone is aware of reports about the negative consequences of global warming ... that will occur if nations and industries do not take immediate action. For this reason alone, we focus our passion as engineers on the need to increase fuel efficiency to reduce CO2 emissions. But I also want to focus some attention on the need to carefully and effectively manage the limited resource of fossil fuels. Most of the energy sources we consume today are fossil fuels ... including petroleum, coal and natural gas. And the threat of exhausting these resources is growing closer.

According to a report by the New Energy Foundation, the proven petroleum reserves known to the world totals about 1 trillion barrels. To give you some perspective ... if we flip Mt. Fuji upside down like a small cup we use to drink sake ... the world's remaining petroleum would measure only one-eighth of the cup. That doesn't make for a very big party. I realize some people might say there is more oil to be found in the world. But there is no question that the supply ... no matter how large ... is limited. And global demand is accelerating at an incredible pace.

It is a global issue ... and every nation ... every company ... and every consumer ... must share the limited supply of petroleum by efficiently using what remains on this earth. We must take action now ... to address both resource sustainability and global warming. It should be the mission of all automakers to develop technologies to dramatically increase fuel efficiency.

I think this challenge is a direct link to my own origin with Honda almost 40 years ago. So, I look at this challenge in a similar way to how we approached the issue of clean air. We are again in a race ... this time to reduce the amount of fuel we consume. This is the most important race we can run as automakers. But we should not run this race to compete against each other. Our goal is to encourage each other to achieve something important for the future of life on this earth.

In the face of this challenge ... and the need to consume less energy ... Honda still has a strong passion to provide mobility to people all over the world. But to achieve it, we are pursuing a unique and "wholistic" approach ... developing new vehicles and power plants ... the infrastructure to re-fuel them ... and even energy creation technologies that will power them. This approach requires advancing every aspect of our business.

We believe there are still significant gains that can be made to improve the efficiency of the internal combustion engine. But in addition to advancing such gasoline and diesel engines ... we continue to expand gas-electric hybrid vehicle technology.

Within the next few years, we are introducing two different, all-new hybrid small cars. Our goal is to make the benefits of hybrid technology available to the mass market. Next year, we will launch a more compact and affordable hybrid vehicle ... with a global sales plan of 200,000 units per year. This will be followed by the global introduction of a small hybrid sports model. Based on our passion for fun-to-drive vehicles ... this will be a sporty hybrid unlike anything currently on the market.

These technologies will help reduce the amount of petroleum required to power Honda vehicles. But with a vision to establish a society that does not rely on fossil fuels ... the ultimate solution is a fuel-cell vehicle powered by hydrogen.

Last fall, we introduced the all new FCX Clarity ... a hydrogen-powered fuel cell vehicle. This enabled us to create a vehicle that delivers both advanced technology and advanced design. FCX Clarity will be offered to a limited number of retail customers in Southern California this summer ... and in Japan this fall.

To accelerate the use of this fuel cell technology ... and to achieve the maximum environmental benefit ... we continue research of technologies that will support fuel cell vehicles in the real world. This includes hydrogen refueling infrastructure and energy creation technologies.

We are now testing the fourth generation of Honda's Home Energy Station for hydrogen fueling. This innovative system is being tested at our R&D Center in Los Angeles. It converts natural gas into hydrogen for fuel cell vehicle refueling ... while supplying hot water and electricity that could be used in a home.

We also established an experimental solar-powered hydrogen station at our LA R&D Center. By using solar-power to create hydrogen we can make fuel cell vehicles a mobility technology that uses absolutely no fossil fuels.

Further ... last year we formally entered the field of energy creation ... starting the mass production and sales of a solar cell system in Japan. This thin film solar cell was independently developed by Honda ... and achieves high photoelectric transfer efficiency. We also reduced CO2 emissions in the production process of these cells by 50 percent compared to the typical silicone type. We'll be selling our products globally in the near future.

Our energy creation efforts also include new technology to create ethanol from soft biomass. The United States has already begun to experience the adverse effects of using feedstock to produce ethanol. Honda R&D is working to develop a new technology to produce ethanol more efficiently from inedible material such as rice straw.

We will continue this wholistic approach ... accelerating the development of technology from every direction ... creating the products ... the refueling infrastructure ... and even energy itself. And while I have focused on automobiles today ... we will apply this capability that is unique to Honda ... to each of our product segments ... motorcycles, automobiles, and power products.

In this way ... we will continue to challenge toward development of new and improved forms of mobility ... from our original mobility business of motorcycles ... to the humanoid robot ASIMO with a focus on artificial intelligence. We also have entered the 3rd dimension ... by entering the field of aviation with HondaJet.

I really believe there is no end to Honda's effort to provide the world with these new and improved forms of mobility. And a critical part of this direction is our commitment to achieve it while minimizing our environmental footprint.

In short, what inspired me to join Honda almost 40 years ago is still true about Honda today. Regardless of the times, at Honda we want to be a company that can provide true "joy" to each one of our customers ... by applying unique and advanced technologies to create environmentally responsible mobility.

Thank you for your attention.