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Seminar paper from the year 2002 in the subject Business economics - General, grade: very good, Mälardalen University (Institution of Economics), course: Strategies and the new Economy, language: English, abstract: The company Honda started very small and gradually developed into the size of a multinational cooperation. Today it has developed a big network of subsidiaries worldwide.1 Through relying on core competence they were able to develop into the company we see today. In the long run, a company’s core competence comes from its ability to build at lower cost and more speedily than competitors competitive advantages.2 Usually, it takes innovative acts to build this and the goal of a company should therefore be competitive innovation instead of competitive imitation.3 Honda has a two to three years cycle from development to production compared to a four years average in the auto-industry. Also, products such as the Super Cup created great enthusiasm in America because it was offered at a very small price. Next, Honda often develops its own equipment and finds solution to specific problems. To be the largest motorcycle producer in 1959 is only one evidence for striking success. It’s major influence in revolutionizing products worldwide seems mysterious considering the general background of the poor entrepreneur Soichiro Honda in the 40th and the small size of Research and Development expenditures today in front of fierce competition from other larger firms.