Junichi Yoshida, Hino Motors

Bermuda-based corporations increased by about the same amount during that period.)
      The most recent splash was a group of November 2004 announcements from Honda Motor Co. that includes a $100-million expansion in Russel's Point, Ohio; a $70-million expansion in Lincoln, Ala.; and its 13th North American plant, a $100-million transmission facility in Tallapoosa, Ga., that will support the Lincoln operations (see the Georgia Spotlight, p. 78). The company is also investing $265 million in its fourth Chinese plant, in Guangzhou. At the same time, the parent company has all its bases covered, with American Honda Motor Co. signing a 10-year lease for an auto import facility at the Port of Portland in Oregon.
      At Toyota's TABC assembly site in Ontario, Calif., Hino Motors Manufacturing USA (HMM), a Toyota affiliate, just began production of its first North American trucks with a $30-million investment. HMM also builds automotive components for Toyota, and as of September 2004, Hino employed more than 220 in the U.S.. The TABC operation employs more than 580, and has been in operation since 1972, which is roughly the same length of time Hino has led Japan in sales of medium/heavy duty trucks. HMM hopes to make a similar impression in North America. Hino's production and sales plan for 2004 called for a 13.2-percent boost in production for the overseas market and a 26.6-percent boost in overseas sales, driven largely by the NAFTA marketplace.
      "Hino is currently the 10th largest manufacturer worldwide, based on vehicle production in 2003," says Junichi Yoshida, manager of corporate communications in Hino's Japan-based corporate planning division. "Our target is to become the 5th largest and to establish the Hino brand as being remarkably reliable in the global market. To achieve that object, the success in the North America market is very important."
      To that end, the company's sales division has also made some high-profile site selections this year, with a relocation from New York to Michigan and an additional large lease in Memphis. Derek Kaufman with Hino Motors Sales says the relocation discussion began immediately in the wake of the company's restructuring in June 2003.
      "We wanted to be closer to the key suppliers of the driveline components for our vehicles," he says. "Unlike other Japanese truck OEMs, Hino has chosen to use American suppliers for all of the drive components such as axles, transmissions, drivelines, steering gear etc. These suppliers are predominantly located in the Midwest."
      The 27-person team also knew they would be growing as sales increased, and needed to attract top talent affordably: "The cost of living and housing costs in the Orangeburg, New York area, just north of New York City, makes that tough to do," says Kaufman. And not only would the Detroit area supply the industry talent base, but its airport would provide short-hop connections to "a very large cross-section of major trucking areas in the U.S."
      While strategy certainly is a key in the company's multiple location decisions, opportunity plays a part too. "Penske Corporation and Mitsui & Company are both investors in Hino Motors Sales Inc. and also happen to have offices in the Detroit area," says Kaufman.
      Across the Mississippi River from HMS' digs in Memphis, HMM is investing $160 million in a 400,000-sq.-ft. (37,160-sq.-m.), 280-employee production facility in Marion, Ark., the famous runner-up site to San Antonio, Texas, for Toyota's truck plant. Yoshida says the company's overseas manufacturing business management division collaborated with colleagues in the global strategic production, financial and legal divisions to submit site candidates to top management for both production decisions.
      "We selected Marion by our own criteria, although we referred [to] Toyota's examination," says Yoshida. Those site criteria, evaluated between January 2003 and May 2004, included: location and transportation factors, shape, size, flood risk, price, zoning, incentive and work force. "Some cities in Tennessee were competing with Marion site to the end," says Yoshida. "The reasons we preferred Marion, Arkansas, were the shape of land and suitability for logistics."
      The state's automotive appeal broadened on Election Day 2004, when 63 percent of the electorate voted to pass the "Super Projects Funding Amendment," which allows the governor and legislature to issue bonds to finance infrastructure, site prep and work force training for a company planning to invest at least $500 million and create at least 500 jobs. The upper limit for the bonding capacity is 5 percent of the state's annual general revenue, which would currently peg the maximum at $200 million.
      Hino currently sources approximately 50 percent of its North American components in North America, and Yoshida says the company would like to grow that localization ratio. HMM is also apparently interested in branching out further. Asked how much consideration Hino has given to expansion in Mexico and Canada, Yoshida says, "We have been doing business in Canada for about 30 years and market share in the last year was about 13 percent in our segment. We had already introduced our new model in Canada as well as the USA for further expansion of our sales there. We believe Mexico has a potential in our business, but we are not in a position to release any concrete plan at this moment."