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L H G posted 08-05-2013 04:41 PM ET (US)
Why would [Tohatsu-USA enter into an agreement with Honda to re-brand Honda four-stroke-cycle engines as Tohatsu and offer them for sale in the USA]?
onlyawhaler posted 08-05-2013 06:27 PM ET (US)
Seems to me that Tohatsu has seen the writing on the wall and determined that their best game is trolling motors and they need serious help in going big.
They probably also see that Honda is a premier company that makes premier 4 stroke, 3 star everything outboards and they see that is their best option is to "make a deal"
I think it is a huge complement to Honda.
The only thing I wonder is if what Honda sells to Tohatsu will be the exact same product that Honda sells or if it wil be a slightly watered down product.
Onlyawhaler
Sterling

I
onlyawhaler posted 08-05-2013 06:47 PM ET (US)
The announcement posted by Larry from Tohatsu also states they will be carrying a brand of mid range DFI two strokes.
It will be interesting to see what brand they choose to carry.
Very interesting.
Sterling
Onlyawhaler
seahorse posted 08-05-2013 07:00 PM ET (US)
Tohatsu already manufactures DFI engines that use the Australian Obital system, the same design as Mercury uses for their Optimax outboards
pete r posted 08-06-2013 02:35 AM ET (US)
Alot of people hurting these days, no one's immune at the moment. It's also a good time to chum up to break into new markets.
My new 250 Honda ticks all the boxes so far....
Ridge Runner posted 08-06-2013 11:33 AM ET (US)
Wow.. ..what does this really mean?
Is there possible consolidation in the outboard manufacturing industry? Or is this a push by Honda to capture a larger market share?
Honda has some very aggressive marketing and promotional programs going on right now, 2.49% financing on just engines and 3.99% on any new Honda powered boat/motor package.
As a conglomerate company Honda is a multiple times larger than any other competitor. 2012 Honda ranked 64 on the global top 500 with +~101 billion in revenue, followed by Suzuki at 316 with +~30 billion in revenue, Yamaha at ~4 billion, Brunswick at ~3.7 billion, BPR at ~2.5 billion and Tohatsu at ~$500 million.
Tohatsu manufactures for Nissan(full line), Mercury, Mariner, Evinrude and with Honda now selling 60HP to 250HP outboard to Tohatsu for rebranding, Yamaha and Suzuki are the only major manufacture that design, build and sell a complete line of outboards solely for its own direct sales channels under its own name.
Maybe this is Honda’s way of test the market for a possible purchase of Tohatsu. Interesting that Toshatsu didn’t leverage the Mercury JV and re-brand Mercury 4 cycle outboards…. If Honda wants to flex some muscle and start to own the outboard market they certainly have the deep pockets to do so… are we seeing the awaking of the sleeping giant?
Ridge Runner posted 08-06-2013 11:44 AM ET (US)
OR!! Could this a test to see if the Tohatsu distribution network can support the Honda product line? Honda could be looking at the marine division and deeming it non-strategic.
This could be the first step in divesting the marine division…
Honda has a niche market share in both outboards and personal watercraft. With the growth of electric cars and the R&D dollars needed to stay on top of the pile maybe the marine division is a distraction….
L H G posted 08-06-2013 02:17 PM ET (US)
Ridge - My speculation exactly. Why would a major operation like Honda detract from their main branding by painting them up for Tohatsu, a company already in a longstanding partnership with competitor Mercury.
My speculation only (don't accuse me of starting a rumor) is that Honda may be considering getting out of outboards since they are already ranked somehwere between 4th and 6th (last) place in the world total market share, 2-350HP. This could be a test run to see if Tohatsu can buy them out and succeed with the product?
What's in it for Tohatsu? A lot. The small 2-30HP 4-stroke engines they make in partnership with Mercury are a huge success, and could be #1 in small outboards 30HP and below. But Mercury owns half of that operation. Then look at the rest of their line, the 3-star 2-stroke TLDIs. That's all they have. Has anybody even seen one in the US? Over here at least, the 2-stroke DFI market, probably in decline in term of overall unit sales, is owned by Mercury and Evinrude.
So Tohatsu has a big 4-stroke problem over 30HP. If they bought out the Honda line, their problems would be over and they could move forward like Mercury, with entrys in both 2-stroke and 4-stroke, covering both bases.
onlyawhaler posted 08-06-2013 02:21 PM ET (US)
Honda had a niche market in watercraft (Aquacraft) and ended it several years ago. They are out and gone. Probably wasn't worth their time. I have a couple of the 1200cc models and they are simply outstanding, 4 stroke, 3 star machines.
I believe their outboards are outstanding as well, but the boat transom market seems like a closed market in many instances regardless of how good you.
It will be interesting to see what they do with this new venture. Honda sells many of its engines to other vendors who package them with their products. Generators, water pumps, power washers come to mind on those ventures who advertise "a Honda engine" when the total package isn't completely Honda
Its interesting to see what Honda will not sell to in the secondary market like lawn mowers, tillers, 4 stroke weed whippers, of course cars and until now, outboards.
Sterling
Onlyawhaler
martyn1075 posted 08-06-2013 05:52 PM ET (US)
They are very good they usually keep to themselves and let the product do the talking. The problem thus far is Yamaha is still way ahead in there market share. They sell so many outboards. They broke through over decade ago and so far so good. Things can change though Maybe Honda will be the next Four Stroke giant. I don't hear too many ever say the engine is terrible unreliable and not sea worthy. Over many years they constantly bring a good quality reliable engine for people to purchase.
They never seem to push anything on anyone. Very passive that way. They make a truck its their first one ever its fantastic reliable mid size truck. Most companies first attempt would be a lemon. They hardly ever advertise it disappears after sells drop naturally. The same buyers would by another one if they could. Most truck companies would take buyers input change it sell it again. They are funny that way. It wouldn't surprise me if next year there is a new Ridgeline with Hybrid engine in it.
Martyn
jimh posted 08-06-2013 08:14 PM ET (US)
Martyn--Can you re-write your article and in place of "they" use the name of the company you are referring to? I cannot tell which company "they' refers to in most of your sentences, that is, Honda, Yamaha, or Tohatsu. Thanks. It will make your article much clearer for readers.
jimh posted 08-06-2013 08:52 PM ET (US)
I do not see how Honda can be hurt by their arrangement to sell engines to Tohatsu. Honda increases their sales. In most manufacturing operations involving mass production there is usually more profit to be made on the last product sold than on the first product sold. The cost of manufacturing, the design, the research, the overhead of the operation, all must be paid for with the first products sold. The selling of one more incremental product usually means the most profit added. By Honda selling more engines they will make more profit.
On that basis, the entire topic of this discussion [which was "Honda must be huring"] seems completely backwards and opposite of the reality of the situation; accordingly, I have changed the topic.
Tom W Clark posted 08-06-2013 08:57 PM ET (US)
[Pointed out that Tohatsu selected HONDA engines for their four-stroke-cycle buy, not Mercury. I accidentally deleted the original article--jimh]
Ridge Runner posted 08-06-2013 09:17 PM ET (US)
For Tohatsu this is an interesting move as positions them nicely to compete globally with Yamaha and Mercury. Tohatsu lists 850 authorized dealers in the United States, I image dealers will have to be recertified to sell and service the Honda line.
It seems that Honda, Tohatsu/Nissan have had a relationship in the past and this very well maybe an extension of that agreement as described this article in Sportfishing Magazine as well as picture of the Honda made Tohatsu lineup:
http://www.sportfishingmag.com/boats/boat-engines/ honda-agrees-supply-outboards-tohatsu
In Japan it seems Nissan has been marketing re-labeled Honda’s for years:
http://www.nissan-marine.co.jp/engin/225-200.html
jimh posted 08-06-2013 09:34 PM ET (US)
[I deleted a sidebar topic which speculated about further future deals with Honda. Let us restrict the discussion to the actually announced deals. If we were to speculate about what deals might be made in the future, we could speculate about many arrangements, but I see nothing in the announcement from Tohatsu that suggests any other relationships between Honda and other manufacturers.--jimh]
Peter posted 08-07-2013 07:29 AM ET (US)
Prior to this deal, Tohatsu's product line consisted of conventional 2-stroke outboards from 2 to 140 HP sold outside of "climate controlled" countries, 4-strokes from 2.5 HP to 30 HP and the TLDI air assisted DFI 2-strokes using Orbital's technology ranging from 40 to 115 HP. So this deal rounds out their product offering enabling them to participate in the entire outboard motor market.
I wonder if one aspect of this deal is that Tohatsu is trying to reduce its obligations under the Orbital license for its TLDI air assisted DFI 2-strokes. With the 75 to 115 HP overlap in product line, one would expect that they will sell less TLDI models.
Also, in looking at their advertisement for the TLDI models, it says they meet the 2006 EPA standards for emissions. However, the 2006 standards no longer apply, the 2010 standards now apply. I wonder if the current TLDI models meet the EPA 2010 standards. If not, then Tohatsu probably can't sell some or all of the TLDI product in the the U.S.
Side note: I've never seen a TLDI product around here. Most Tohatsu motors sold around here wear a Mercury paint and decal dressing.
L H G posted 08-07-2013 08:22 AM ET (US)
The content of my initial post and thread title have been altered to meet website editorial policy.
jimh posted 08-07-2013 08:31 AM ET (US)
Larry writes:
"The content of my initial post and thread title have been altered to meet website editorial policy."
This is precisely correct. The website does not publish complete nonsense and wild speculation for which there is no basis. The portions of the initial article that have been deleted are completely unrelated to the press release from Tohatsu, and appear to be simply unfounded speculation.
There is not very much "editorial" slant in the present TOPIC line. I cannot imagine a TOPIC which would convey less bias or slant than the present topic.
jimh posted 08-07-2013 09:40 AM ET (US)
Ridge Runner--many thanks for the links to the websites showing that Honda four-stroke-cycle outboard engines have been marketed in Asia under the NISSAN brand name. This seems to establish a precedent for Honda selling their engines to other outboard engine manufacturers for re-branding.
The sale of complete outboard engine assemblies by one manufacturer to another manufacturer who re-brands the engine as his own has occurred many times, particularly in North America. We have seen that Mercury, for example, has purchased complete engines from Yamaha and Tohatsu and re-branded them as Mercury engines. We have also seen that Johnson has bought outboard engines from Suzuki and re-branded them as Johnson.
The only unusual part of the Tohatsu-Honda announcement is the pairing of two Japanese manufacturers in North American. It is my impression that Honda Marine in the USA has been held back from greater sales and market share by their generally limited dealer network. There is no doubt that the Honda outboard engines are extremely good engines. We have seen that the actual bid specifications by the United States Coast Guard for small boat procurement required that the supplied outboard engine be able to operate for at least 4,000-hours without major repair, and that all these procurements were fulfilled with Honda engines. I think that says something profoundly positive about Honda outboard engines.
Peter posted 08-07-2013 10:04 AM ET (US)
At least around here the Tohatsu dealership network is even more limited than Hondas. According to Tohatsu's website, there is only one Tohatsu dealer within 50 miles of my location. There are five Honda dealers within that same search criteria. Interestingly, that one Tohatsu dealer is also a Honda dealer. That dealer is 4 miles from my location and I still haven't seen any Tohatsu outboards around here.
jimh posted 08-07-2013 10:20 AM ET (US)
Peter--you make an interesting observation. In the past when a manufacturer reached an agreement with a competitor to supply the competitor with complete engines for re-branding, it was usually the case that the company doing the re-branding had the greater distribution network, had more dealers, or had a better recognized name. In the case of Honda selling outboard engines to Tohatsu for re-branding as Tohatsu engines in the USA, it seems like the Honda name has much better brand recognition, and there are more Honda dealers than Tohatsu dealers. (I don't know anything about the distribution networks, and, since I don't know anything, I don't speculate about the distribution networks)
My own personal preference in buying a product that was re-branded would be to buy the product from the original maker, not under the re-branded make, unless there was some compelling reason that I had to have the product under the re-branded name. For me, personally, I do not have any sort of product brand loyalty that would be so strong that I had to get a particular product under a re-branded name just because I liked that brand name more than the original. But the idea that a re-branded product might be serviced at ten-times more dealers than the original brand could be an influence. If Peter's assessment of the relative size of the dealer-base for Tohatsu and Honda is correct, it would seem that there are more Honda dealers than Tohatsu dealers. That would tend to nullify any preference to the Tohatsu brand for a re-branded Honda product for service, too.
pcrussell50 posted 08-07-2013 10:33 AM ET (US)
Here in Santa Barbara (and maybe the rest of southern California), it is Honda country. The commercial operators use them almost exclusively, as it appears, do the savvy re-power folks, with sturdy boats like Whalers that can and do outlast their original motors. Yamaha's are probably in second place, and in my estimation, most likely seen on the less savvy re-powers, and almost never on the commercial operators. Obviously, for commercial operators, the availability of prompt repairs is crucial, and the local outboard seller sells Honda's. As an aside, he's offering 2.49% financing on Honda outboards right now.
-Peter
Peter posted 08-07-2013 01:55 PM ET (US)
This relationship may be a way for Honda to sell more product in a Honda outboard dealer's otherwise exclusive territory. Clearly, dealers who have an exclusive territory for selling Honda outboards would not be happy with an unrelated Tohatsu dealer now being able to sell the same product in the same territory with a Tohatsu badge, and probably for less money because the Honda name should command a price premium over the Tohatsu name.
jimh posted 08-08-2013 10:30 AM ET (US)
I think Johnson and Evinrude played that same sort of game with dealers and territories, too.
jimh posted 08-08-2013 02:22 PM ET (US)
In selecting HONDA as their partner for providing four-stroke-cycle engines, Tohatsu USA has made a wise choice. It is very easy to understand why they would not choose Brunswick's Mercury brand. Mercury-branded outboard engines are very widely available in the USA. There would be very little sense in trying to sell an outboard in the USA that was a duplicate of a Mercury-branded outboard under a different brand and in competition with Mercury's brand. Such an arrangement for Tohatsu would put them in direct competition with Mercury-branded engines in every instance, for it is hard to imagine a location in which there presently is a Tohatsu dealer but there is no Mercury dealer. Also, Mercury-branded engines are often sold as the least-expensive option. The lower selling price of Mercury-branded engines in the marketplace is often cited as a distinct advantage to buying a Mercury-brand engine. THe rock-bottom prices at which Mercury-branded engines are sold would leave little room for Tohatsu to compete and be profitable. Also, Brunswick's policy of letting some Mercury-brnd dealers sell at fantastically low retail prices and ship all over the country, often below the dealer-cost for other dealers whose sale volume is not high, puts even more price compeition into the sale of Mercury-branded engines. Finally, Mercury-branded outboard engines are usually a primary brand for a dealer, while Honda is normally a secondary or lower-volume line.
In contrast, by partnering with Honda, Tohatsu is very likely going to sell into local markets where its dealers will not face such strong local competition from Honda dealers. Also, Honda outboard engines seem to seldom--if ever--be sold as low-cost alternatives. Honda outboard engines usually command a premium price, above all other engines in the market. This may allow Tohatsu some room in their pricing to offer a more attractive price for their re-branded Honda engines. And they won't have to compete with high-volume dealers who ship engines into other dealers' territories. Finally, Honda is usually not a primary engine brand for a dealer. It is my impression that dealers may carry Honda engines, but often it is as a secondary product line, and their main outboard engine line is usually one of the more popular brands, which they sell in higher volume.
OMCrobert posted 10-16-2013 12:30 AM ET (US)
This looks like a real boost for Honda outboards. I would bet that the number of available servicing dealership just doubled where you could get Honda parts.
Peter posted 10-16-2013 08:53 AM ET (US)
I vacationed in Cape Cod in August and observed that there were many boats with mid-sized Tohatsu outboards on their transom and it thus appeared to me that Tohatsu has a strong following there, probably due to the dealer. So the Tohatu (Honda) product line expansion may work well in the Cape.

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Author	Topic: Tohatsu News
L H G	posted 08-05-2013 04:41 PM ET (US) Why would [Tohatsu-USA enter into an agreement with Honda to re-brand Honda four-stroke-cycle engines as Tohatsu and offer them for sale in the USA]?
onlyawhaler	posted 08-05-2013 06:27 PM ET (US) Seems to me that Tohatsu has seen the writing on the wall and determined that their best game is trolling motors and they need serious help in going big. They probably also see that Honda is a premier company that makes premier 4 stroke, 3 star everything outboards and they see that is their best option is to "make a deal" I think it is a huge complement to Honda. The only thing I wonder is if what Honda sells to Tohatsu will be the exact same product that Honda sells or if it wil be a slightly watered down product. Onlyawhaler Sterling I
onlyawhaler	posted 08-05-2013 06:47 PM ET (US) The announcement posted by Larry from Tohatsu also states they will be carrying a brand of mid range DFI two strokes. It will be interesting to see what brand they choose to carry. Very interesting. Sterling Onlyawhaler
seahorse	posted 08-05-2013 07:00 PM ET (US) Tohatsu already manufactures DFI engines that use the Australian Obital system, the same design as Mercury uses for their Optimax outboards
pete r	posted 08-06-2013 02:35 AM ET (US) Alot of people hurting these days, no one's immune at the moment. It's also a good time to chum up to break into new markets. My new 250 Honda ticks all the boxes so far....
Ridge Runner	posted 08-06-2013 11:33 AM ET (US) Wow.. ..what does this really mean? Is there possible consolidation in the outboard manufacturing industry? Or is this a push by Honda to capture a larger market share? Honda has some very aggressive marketing and promotional programs going on right now, 2.49% financing on just engines and 3.99% on any new Honda powered boat/motor package. As a conglomerate company Honda is a multiple times larger than any other competitor. 2012 Honda ranked 64 on the global top 500 with +~101 billion in revenue, followed by Suzuki at 316 with +~30 billion in revenue, Yamaha at ~4 billion, Brunswick at ~3.7 billion, BPR at ~2.5 billion and Tohatsu at ~$500 million. Tohatsu manufactures for Nissan(full line), Mercury, Mariner, Evinrude and with Honda now selling 60HP to 250HP outboard to Tohatsu for rebranding, Yamaha and Suzuki are the only major manufacture that design, build and sell a complete line of outboards solely for its own direct sales channels under its own name. Maybe this is Honda’s way of test the market for a possible purchase of Tohatsu. Interesting that Toshatsu didn’t leverage the Mercury JV and re-brand Mercury 4 cycle outboards…. If Honda wants to flex some muscle and start to own the outboard market they certainly have the deep pockets to do so… are we seeing the awaking of the sleeping giant?
Ridge Runner	posted 08-06-2013 11:44 AM ET (US) OR!! Could this a test to see if the Tohatsu distribution network can support the Honda product line? Honda could be looking at the marine division and deeming it non-strategic. This could be the first step in divesting the marine division… Honda has a niche market share in both outboards and personal watercraft. With the growth of electric cars and the R&D dollars needed to stay on top of the pile maybe the marine division is a distraction….
L H G	posted 08-06-2013 02:17 PM ET (US) Ridge - My speculation exactly. Why would a major operation like Honda detract from their main branding by painting them up for Tohatsu, a company already in a longstanding partnership with competitor Mercury. My speculation only (don't accuse me of starting a rumor) is that Honda may be considering getting out of outboards since they are already ranked somehwere between 4th and 6th (last) place in the world total market share, 2-350HP. This could be a test run to see if Tohatsu can buy them out and succeed with the product? What's in it for Tohatsu? A lot. The small 2-30HP 4-stroke engines they make in partnership with Mercury are a huge success, and could be #1 in small outboards 30HP and below. But Mercury owns half of that operation. Then look at the rest of their line, the 3-star 2-stroke TLDIs. That's all they have. Has anybody even seen one in the US? Over here at least, the 2-stroke DFI market, probably in decline in term of overall unit sales, is owned by Mercury and Evinrude. So Tohatsu has a big 4-stroke problem over 30HP. If they bought out the Honda line, their problems would be over and they could move forward like Mercury, with entrys in both 2-stroke and 4-stroke, covering both bases.
onlyawhaler	posted 08-06-2013 02:21 PM ET (US) Honda had a niche market in watercraft (Aquacraft) and ended it several years ago. They are out and gone. Probably wasn't worth their time. I have a couple of the 1200cc models and they are simply outstanding, 4 stroke, 3 star machines. I believe their outboards are outstanding as well, but the boat transom market seems like a closed market in many instances regardless of how good you. It will be interesting to see what they do with this new venture. Honda sells many of its engines to other vendors who package them with their products. Generators, water pumps, power washers come to mind on those ventures who advertise "a Honda engine" when the total package isn't completely Honda Its interesting to see what Honda will not sell to in the secondary market like lawn mowers, tillers, 4 stroke weed whippers, of course cars and until now, outboards. Sterling Onlyawhaler
martyn1075	posted 08-06-2013 05:52 PM ET (US) They are very good they usually keep to themselves and let the product do the talking. The problem thus far is Yamaha is still way ahead in there market share. They sell so many outboards. They broke through over decade ago and so far so good. Things can change though Maybe Honda will be the next Four Stroke giant. I don't hear too many ever say the engine is terrible unreliable and not sea worthy. Over many years they constantly bring a good quality reliable engine for people to purchase. They never seem to push anything on anyone. Very passive that way. They make a truck its their first one ever its fantastic reliable mid size truck. Most companies first attempt would be a lemon. They hardly ever advertise it disappears after sells drop naturally. The same buyers would by another one if they could. Most truck companies would take buyers input change it sell it again. They are funny that way. It wouldn't surprise me if next year there is a new Ridgeline with Hybrid engine in it. Martyn
jimh	posted 08-06-2013 08:14 PM ET (US) Martyn--Can you re-write your article and in place of "they" use the name of the company you are referring to? I cannot tell which company "they' refers to in most of your sentences, that is, Honda, Yamaha, or Tohatsu. Thanks. It will make your article much clearer for readers.
jimh	posted 08-06-2013 08:52 PM ET (US) I do not see how Honda can be hurt by their arrangement to sell engines to Tohatsu. Honda increases their sales. In most manufacturing operations involving mass production there is usually more profit to be made on the last product sold than on the first product sold. The cost of manufacturing, the design, the research, the overhead of the operation, all must be paid for with the first products sold. The selling of one more incremental product usually means the most profit added. By Honda selling more engines they will make more profit. On that basis, the entire topic of this discussion [which was "Honda must be huring"] seems completely backwards and opposite of the reality of the situation; accordingly, I have changed the topic.
Tom W Clark	posted 08-06-2013 08:57 PM ET (US) [Pointed out that Tohatsu selected HONDA engines for their four-stroke-cycle buy, not Mercury. I accidentally deleted the original article--jimh]
Ridge Runner	posted 08-06-2013 09:17 PM ET (US) For Tohatsu this is an interesting move as positions them nicely to compete globally with Yamaha and Mercury. Tohatsu lists 850 authorized dealers in the United States, I image dealers will have to be recertified to sell and service the Honda line. It seems that Honda, Tohatsu/Nissan have had a relationship in the past and this very well maybe an extension of that agreement as described this article in Sportfishing Magazine as well as picture of the Honda made Tohatsu lineup: http://www.sportfishingmag.com/boats/boat-engines/ honda-agrees-supply-outboards-tohatsu In Japan it seems Nissan has been marketing re-labeled Honda’s for years: http://www.nissan-marine.co.jp/engin/225-200.html
jimh	posted 08-06-2013 09:34 PM ET (US) [I deleted a sidebar topic which speculated about further future deals with Honda. Let us restrict the discussion to the actually announced deals. If we were to speculate about what deals might be made in the future, we could speculate about many arrangements, but I see nothing in the announcement from Tohatsu that suggests any other relationships between Honda and other manufacturers.--jimh]
Peter	posted 08-07-2013 07:29 AM ET (US) Prior to this deal, Tohatsu's product line consisted of conventional 2-stroke outboards from 2 to 140 HP sold outside of "climate controlled" countries, 4-strokes from 2.5 HP to 30 HP and the TLDI air assisted DFI 2-strokes using Orbital's technology ranging from 40 to 115 HP. So this deal rounds out their product offering enabling them to participate in the entire outboard motor market. I wonder if one aspect of this deal is that Tohatsu is trying to reduce its obligations under the Orbital license for its TLDI air assisted DFI 2-strokes. With the 75 to 115 HP overlap in product line, one would expect that they will sell less TLDI models. Also, in looking at their advertisement for the TLDI models, it says they meet the 2006 EPA standards for emissions. However, the 2006 standards no longer apply, the 2010 standards now apply. I wonder if the current TLDI models meet the EPA 2010 standards. If not, then Tohatsu probably can't sell some or all of the TLDI product in the the U.S. Side note: I've never seen a TLDI product around here. Most Tohatsu motors sold around here wear a Mercury paint and decal dressing.
L H G	posted 08-07-2013 08:22 AM ET (US) The content of my initial post and thread title have been altered to meet website editorial policy.
jimh	posted 08-07-2013 08:31 AM ET (US) Larry writes: "The content of my initial post and thread title have been altered to meet website editorial policy." This is precisely correct. The website does not publish complete nonsense and wild speculation for which there is no basis. The portions of the initial article that have been deleted are completely unrelated to the press release from Tohatsu, and appear to be simply unfounded speculation. There is not very much "editorial" slant in the present TOPIC line. I cannot imagine a TOPIC which would convey less bias or slant than the present topic.
jimh	posted 08-07-2013 09:40 AM ET (US) Ridge Runner--many thanks for the links to the websites showing that Honda four-stroke-cycle outboard engines have been marketed in Asia under the NISSAN brand name. This seems to establish a precedent for Honda selling their engines to other outboard engine manufacturers for re-branding. The sale of complete outboard engine assemblies by one manufacturer to another manufacturer who re-brands the engine as his own has occurred many times, particularly in North America. We have seen that Mercury, for example, has purchased complete engines from Yamaha and Tohatsu and re-branded them as Mercury engines. We have also seen that Johnson has bought outboard engines from Suzuki and re-branded them as Johnson. The only unusual part of the Tohatsu-Honda announcement is the pairing of two Japanese manufacturers in North American. It is my impression that Honda Marine in the USA has been held back from greater sales and market share by their generally limited dealer network. There is no doubt that the Honda outboard engines are extremely good engines. We have seen that the actual bid specifications by the United States Coast Guard for small boat procurement required that the supplied outboard engine be able to operate for at least 4,000-hours without major repair, and that all these procurements were fulfilled with Honda engines. I think that says something profoundly positive about Honda outboard engines.
Peter	posted 08-07-2013 10:04 AM ET (US) At least around here the Tohatsu dealership network is even more limited than Hondas. According to Tohatsu's website, there is only one Tohatsu dealer within 50 miles of my location. There are five Honda dealers within that same search criteria. Interestingly, that one Tohatsu dealer is also a Honda dealer. That dealer is 4 miles from my location and I still haven't seen any Tohatsu outboards around here.
jimh	posted 08-07-2013 10:20 AM ET (US) Peter--you make an interesting observation. In the past when a manufacturer reached an agreement with a competitor to supply the competitor with complete engines for re-branding, it was usually the case that the company doing the re-branding had the greater distribution network, had more dealers, or had a better recognized name. In the case of Honda selling outboard engines to Tohatsu for re-branding as Tohatsu engines in the USA, it seems like the Honda name has much better brand recognition, and there are more Honda dealers than Tohatsu dealers. (I don't know anything about the distribution networks, and, since I don't know anything, I don't speculate about the distribution networks) My own personal preference in buying a product that was re-branded would be to buy the product from the original maker, not under the re-branded make, unless there was some compelling reason that I had to have the product under the re-branded name. For me, personally, I do not have any sort of product brand loyalty that would be so strong that I had to get a particular product under a re-branded name just because I liked that brand name more than the original. But the idea that a re-branded product might be serviced at ten-times more dealers than the original brand could be an influence. If Peter's assessment of the relative size of the dealer-base for Tohatsu and Honda is correct, it would seem that there are more Honda dealers than Tohatsu dealers. That would tend to nullify any preference to the Tohatsu brand for a re-branded Honda product for service, too.
pcrussell50	posted 08-07-2013 10:33 AM ET (US) Here in Santa Barbara (and maybe the rest of southern California), it is Honda country. The commercial operators use them almost exclusively, as it appears, do the savvy re-power folks, with sturdy boats like Whalers that can and do outlast their original motors. Yamaha's are probably in second place, and in my estimation, most likely seen on the less savvy re-powers, and almost never on the commercial operators. Obviously, for commercial operators, the availability of prompt repairs is crucial, and the local outboard seller sells Honda's. As an aside, he's offering 2.49% financing on Honda outboards right now. -Peter
Peter	posted 08-07-2013 01:55 PM ET (US) This relationship may be a way for Honda to sell more product in a Honda outboard dealer's otherwise exclusive territory. Clearly, dealers who have an exclusive territory for selling Honda outboards would not be happy with an unrelated Tohatsu dealer now being able to sell the same product in the same territory with a Tohatsu badge, and probably for less money because the Honda name should command a price premium over the Tohatsu name.
jimh	posted 08-08-2013 10:30 AM ET (US) I think Johnson and Evinrude played that same sort of game with dealers and territories, too.
jimh	posted 08-08-2013 02:22 PM ET (US) In selecting HONDA as their partner for providing four-stroke-cycle engines, Tohatsu USA has made a wise choice. It is very easy to understand why they would not choose Brunswick's Mercury brand. Mercury-branded outboard engines are very widely available in the USA. There would be very little sense in trying to sell an outboard in the USA that was a duplicate of a Mercury-branded outboard under a different brand and in competition with Mercury's brand. Such an arrangement for Tohatsu would put them in direct competition with Mercury-branded engines in every instance, for it is hard to imagine a location in which there presently is a Tohatsu dealer but there is no Mercury dealer. Also, Mercury-branded engines are often sold as the least-expensive option. The lower selling price of Mercury-branded engines in the marketplace is often cited as a distinct advantage to buying a Mercury-brand engine. THe rock-bottom prices at which Mercury-branded engines are sold would leave little room for Tohatsu to compete and be profitable. Also, Brunswick's policy of letting some Mercury-brnd dealers sell at fantastically low retail prices and ship all over the country, often below the dealer-cost for other dealers whose sale volume is not high, puts even more price compeition into the sale of Mercury-branded engines. Finally, Mercury-branded outboard engines are usually a primary brand for a dealer, while Honda is normally a secondary or lower-volume line. In contrast, by partnering with Honda, Tohatsu is very likely going to sell into local markets where its dealers will not face such strong local competition from Honda dealers. Also, Honda outboard engines seem to seldom--if ever--be sold as low-cost alternatives. Honda outboard engines usually command a premium price, above all other engines in the market. This may allow Tohatsu some room in their pricing to offer a more attractive price for their re-branded Honda engines. And they won't have to compete with high-volume dealers who ship engines into other dealers' territories. Finally, Honda is usually not a primary engine brand for a dealer. It is my impression that dealers may carry Honda engines, but often it is as a secondary product line, and their main outboard engine line is usually one of the more popular brands, which they sell in higher volume.
OMCrobert	posted 10-16-2013 12:30 AM ET (US) This looks like a real boost for Honda outboards. I would bet that the number of available servicing dealership just doubled where you could get Honda parts.
Peter	posted 10-16-2013 08:53 AM ET (US) I vacationed in Cape Cod in August and observed that there were many boats with mid-sized Tohatsu outboards on their transom and it thus appeared to me that Tohatsu has a strong following there, probably due to the dealer. So the Tohatu (Honda) product line expansion may work well in the Cape.