The freshly painted car bodies looked perfect. They were gun-metal gray, a popular color made lustrous by a base-coat-clear-coat treatment.
Honda dealers all over the United States make extra dollars on the gun-metal gray Accords and another color called academy blue. But these car bodies were not bound for dealerships. Nor were they on their way to final assembly on the floor beneath the paint department of Honda's automobile plant here. They were going to the repair lines, to be sanded down, repainted and rebaked.
"The paint's okay on most of these, but it's not good enough for us," said Scott N. Whitlock, Honda's Marysville plant manager.
"Look at this," said Whitlock, pointing to a tiny pimple in the paint of one of the car bodies. "That's dirt. You can't let something like that get by and still say you want to be number one."
Honda, according to some U.S. auto industry analysts, could wind up No. 1 in this country, at least among the Japan-based auto makers selling and assembling cars in the United States.
It's not a Cinderella story, auto industry analysts say. There is no magic. Honda's automobile plant here, for example, is one of the least automated in the United States.
"Honda simply is doing everything right," said James E. Harbour, president of Harbour & Associates, an auto industry research firm in Berkley, Mich.
He offered examples. Honda started producing motorcycles in Japan in 1948. It began shipping the bikes to the United States 11 years later, at a time when most Americans viewed motorcycle riders as outlaws. Honda turned that image around with a multimillion-dollar advertising campaign -- "You meet the nicest people on a Honda" -- that brought in tens of thousands of new buyers previously overlooked by American motorcycle manufacturers.
U.S. auto makers in 1971 were groaning about new federal regulations limiting the amounts and kinds of air pollutants coming from their cars. They said they would have to install costly catalytic converters -- which also reduced performance -- to meet the new rules.
Honda built its first car, the sports S360, in Japan in 1962. It exported its first car, the N600 sedan, to the United States in 1970. In 1971, Honda introduced a car with something called the compound vortex controlled combustion engine -- the Honda CVCC.
Many buyers did not understand the physics or the engineering. They did understand that the subcompact CVCC got good mileage on cheaper, unleaded gasoline -- and that the car did not need an expensive catalytic converter to meet U.S. emissions regulations in effect at that time.
The CVCC, perhaps more than anything else, helped establish Honda's reputation for automotive quality in the United States, Harbour and other industry analysts say.
"Everybody began to buy a Honda CVCC. Americans really thought they had something different, even something different from what the Japanese were offering," said Maryann N. Keller, a director of and analyst with New York-based Vilas-Fischer Associates.
The Honda story here is being written by 2,800 people who prefer to call themselves "associates." Their enterprise is Honda of America Manufacturing Inc. They call it "HAM" -- now America's biggest producer of motorcycles, and the company that makes Honda Accord sedans and hatchback cars for distribution in the East and Midwest.
HAM is one of Honda's four U.S. subsidiaries. The company, funded with $35 million in initial capital, began building motorcycles in this central Ohio town in 1979. Three years and $250 million later, HAM started producing cars.
HAM turned out 138,572 cars in 1984, enough to rank Honda fifth in production among the six auto companies making cars on U.S. soil.
Honda combined its domestic yield with imports from Japan to sell a total of 508,420 cars in the United States last year. That was more than enough to surpass American Motors Corp., which sold 202,498 cars; enough to overtake Nissan Motor Co. Ltd., Japan's second largest auto maker, which sold 485,298 cars in this country last year; and enough to create consternation at Toyota, Japan's premier auto company, which sold 557,979 cars in the United States in 1984.
Honda is spending another $240 million here to increase its U.S. production capacity to 300,000 cars annually by 1988.
"Our goal for 1990 would be 800,000 cars a year in combined U.S. production and imports," said Tetsuo Chino, president of California-based American Honda Motor Co. Inc., which oversees all of Honda's operations in the United States.
Analysts disagree over whether Honda eventually could pass, and stay ahead of, Toyota in U.S. sales. "It looks as though it's going to be a neck-and-neck race. But Toyota is going to win," Keller said.
"It's very realistic to say that Honda could overtake Toyota in the U.S. market," said John M. Hemphill Jr., senior vice president of J. D. Power & Associates, a marketing research company in Westlake Village, Calif.
Honda already has moved ahead of Nissan in quality ratings and total U.S. car sales, Hemphill said. And Honda cars are steadily gaining ground on Toyota in both categories, he said.
"Honda cars are getting dealer premiums as high as Toyota in many cases," Hemphill said. According to industry reports, those premiums can rise as high as $2,000 over the manufacturer's suggested retail price, particularly for Accords and the sportier Honda Preludes.
But even with those high prices, Honda's 860 U.S. dealers last year sold an average 610 cars per outlet -- more than any other dealers selling cars in the United States.
The Japanese government's recent decision to raise the number of cars its auto makers can send to this country -- now up to 2.3 million units a year -- could dampen that demand for the Honda cars, analysts say. But they say that the true test of Honda's ability to beat Toyota in the United States will come when Toyota follows Honda and Nissan and builds its own plant in America.
Honda got the jump on its Japanese peers, in business and politics, by being the first to set up manufacturing facilities in the United States, Keller said.
"But I have no doubt that Toyota will build a plant in the United States. They will probably announce a factory by the summer. . . . It's partly a matter of pride. Toyota is not going to be beaten out by Honda," Keller said. "They can produce here in America just as well as Honda can."
Toyota had no comment.
Toyota controls 46 percent of the auto market in Japan, versus Honda's relatively skimpy 9 percent market share in that country. Toyota's worldwide revenue last year totaled $23 billion in U.S. dollars, versus Honda's $10.2 billion.
Toyota is building subcompact cars with General Motors in a joint-venture company, New United Motor Manufacturing Inc., operating in Fremont, Calif. But those cars will be sold by GM's Chevrolet division and will not be tallied in Toyota's U.S. sales.
"Overall, I think that our quality here is better than that in Japan," said Shoichiro Irimajiri, president of Honda of America Manufacturing. "I think we will be the best in the world."
Better than Toyota?
"Toyota and Nissan will do in their way what they are doing. We will do in our way what we will do. I do not know what the result will be. But we like the competition," Irimajiri said.
The contest here starts at 6:30 a.m., first with meetings of white-uniformed production teams and then whizz-whizz sounds of hand-held tools capable of fastening four bolts at once.
There aren't many computers or robots in the place, even though there is one huge, roboticized machine that opens its octopus-like arms, grabs the left- and right-side frames of car body and welds them into a car frame, complete with roof and floor-plan.
Otherwise, the Honda plant looks nothing like the automated fantasy lands of GM's new plant in Orion Township, Mich., or Chrysler Corp.'s modern wonder in Sterling Township near Detroit.
Irimajiri said that Honda will add more computers, robots and other whistles and bells here in the plant's expansion. "But, mostly, we are going to rely on our associates," he said, referring to the young work force -- average age 29 years -- employed here.
A full day in HAM's 1-million-square-foot automobile factory indicates what Irimajiri and other Honda officials mean when they speak about "togetherness." There is nothing mystical about it when observed first hand. It simply translates into one "associate" pitching in to help another to get a particular job done.
For example, during a die-change operation completed in a relatively swift 9 minutes and 37 seconds, workers who finished one function immediately moved to another position on the line to help other workers who were having more difficulty completing their tasks.
No one stood around and waited after his or her assigned job was done. And no one complained about having his or her territory invaded by a colleague.
And none of this means that what Honda does here is perfect. On the contrary, the "repair line" -- the holding area for cars that made it through final assembly with defects -- was filled to capacity one day last week. There were some problems with rattling tail-pipes and paint jobs that weren't quite right.
But there was no scapegoating in the discussions on the plant floor. Instead, most of the talk was about "tracing the problems through the system" and getting the cars fixed before they left the plant.
"We try for 100 percent quality," Irimajiri said. "We get 98 percent. But we keep trying for 100."
"The Honda cars coming out of Marysville have as high a quality as those coming out of Japan," Harbour said. "The Marysville plant," as presently constructed, "is a duplicate of the one in Japan," Harbour said.
"It's funny in a way," said Harbour. "You try to tell the Americans that they can't buy themselves out of trouble with their super-high-technology plants, but they don't listen. And this little company is beating them in quality simply in the way it uses its people."
It is something of an industrial Camelot that critics say will be shattered by reality once the "associates" grow older and start demanding the kinds of wages and pensions in existence at traditional U.S. auto companies.
For example, Honda's base wage here is about $11 an hour, compared with $12.82 hourly at GM and Ford Motor Co. That wage discrepancy is highlighted in the United Auto Workers union's continuing drive to turn Honda "associates" into unionized workers here.
"We're not fighting the organizing attempt," said Shige Yoshida, HAM's executive vice president. "It is our belief that Honda should respect the judgment of our associates.
"If they want to be represented by the union, we will sit down and bargain with them. That's fine with us," Yoshida said. "If they don't want to be represented by the union, that's fine with us, too."
The Honda associates this month earned recognition from the home office by building most of the 2,266 cars that could not be built because of bad weather in January and February. Not catching up with production would have meant the loss of those units and about $23 million in sales.
"We had a choice to eat the loss or to make up for it with overtime," said HAM plant manger Scott N. Whitlock. "We discussed it with our associates, whether or not they wanted to do the overtime, and came up with some schedules. We put the whole thing to a vote, and the people here voted in overwhelming numbers to do the job," Whitlock said.
Asked if HAM could operate that way with a union, American Honda President Chino said:
"We think this way in Japan. We share the best things together. In other words, we are sitting in the same boat. So, if boat sinks, management sinks. Labor sinks. So, we must row together. That's the meaning of togetherness."