2016 was a great year for the automotive industry. There were months with booming sales, huge technological strides, marketing advancements, and more. Check out what the top 5 things many of you thought influenced 2016 in automotive.

1. Digital marketing vs. traditional. Digital marketing surged forward even more in 2016, accounting for most of dealership’s marketing budgets. Kristy Elliott says, “We ditched all traditional marketing almost 2 years ago, and rely only on digital. We are up 45% in new car sales, with really good grosses.” 


2. Trends turned from car ownership to ride sharing. Ride sharing became increasingly important in 2016, with many companies working on technological advancements to improve that experience. Manufacturers are even jumping on board and coming up with ways to get involved. These ride sharing advancements though are sometime nerve-wracking for dealers. Owner Allen Turner says that dealers are sometimes “fearful of what we don’t understand or can’t scheme out.”


3. Increase in SUV/truck sales, decline in sedans. 2016 showed us a bit of a decline in sedan sales and an increase in larger vehicles. Some manufacturers like FIAT created larger cross-over vehicles to keep up with the demand.


4. Recalls have almost become the new normal. The average number of recalls per manufacturer was about 1 a month. Allen Turner adds, “Consumers also seem to be less concerned than the dealers, lawyers, manufacturers, and the government about these recalls.”


5. Car-buying services have become everyday life. Most consumers don’t think twice about car-buying services during their shopping experience. Allen Turner again adds, “True Car isn’t a buzzword around the dealership anymore, like Carfax was in its infancy.”

 

These and many other changes made 2016 a crazy year in automotive. Check out our full news article about 2016 for a deeper look at the year in review.

Originally Published By Automotive News

Japan's Takata Corp. is nearing a criminal settlement with the U.S. Department of Justice and is expected to pay up to $1 billion to resolve allegations of wrongdoing related to its faulty airbag inflators, The Wall Street Journal reported today.

The final figure could be in the high hundreds of millions of dollars, the Journal reported, citing people familiar with the matter.

Both the parties are discussing the possibility of the safety products supplier pleading guilty to criminal misconduct as part of the settlement, which could take place as soon as January, though the timing could slip, the newspaper reported.

Takata is expected to pay a part of the penalty up-front and the rest over a number of years, according to the report. The penalty is not "likely to eclipse $1 billion."

Both Takata and the the Justice Department declined to comment.

The company's airbag inflators, which can explode with excessive force in hot and humid conditions, have been linked to 11 deaths and at least 184 injuries in the U.S. Another five deaths have been linked to the airbags globally. 

The U.S. Department of Transportation said earlier this month that it would press the auto industry to accelerate the pace of replacements for defective Takata airbag inflators and signaled a likely widening of the industry's largest ever recall.

Takata is restructuring and is in the process of selling itself. It is considering a Chapter 11 bankruptcy filing in the U.S. as part of that restructuring process. 

DSES 2016 was an amazing event, mostly thanks to our wonderful speakers. We have here for you a list of our 7 highest rated speakers and their key takeaways.

Shaun Raines & Greg Gifford

Key Takeaways:
• Dealers will learn specific strategies for on site and off site organic optimization, based on the latest Local SEO best practices

• Dealers will learn how the recent updates to AdWords will affect auto dealers, and detailed tactics for better PPC campaign performance

• Dealers will learn how to boost local marketing efforts with Facebook ads and beacon marketing.

Adam Robinson

Key Takeaways:
• Learn how to build, manage and maintain a strong culture and workforce
• Learn how to build and leverage a strong employment brand to drive higher quality job applicants AND better consumer leads
• Discover how these leading dealers are compensating and managing their teams via innovative pay plans, strong incentive structures and the potential for career growth

Eric Savage

Key Takeaways:
Attendees will walk away with…
• An understanding of how a purpose-driven business allows for a strongly defined culture, which makes accountability, communication and trust easier.
• A way to see themselves as being “”givers”” instead of “”getters.””
• Proof that putting people before policy, process and profit makes a business stronger and better.
• Practical ways to marry the disciplines necessary for financial success with a culture that is not focused on money.

Brent Wees

Key Takeaways:
• Learn that Technology defines the generations, not the other way around.
• Learn to look past the “”current trend”” of age based marketing and get back to the basics of good retail business in a rapidly evolving technical space.
• Continue to future-proof your dealership to tackle trend with a level head!

Jared Hamilton

To innovate and survive as a successful dealership, general managers and dealer principals need to adopt a competency-based framework for recruiting, hiring, training, and management. This human-capital management style to optimizing dealership will provide a path to success for the next five years, creating value along the way.

You can apply Jared’s thought leadership at your store to:
• Apply a competency-based framework to enhance the business and management at the dealership
• Understand the 5 steps to this model and align them with business plans
• Create lasting value through nurturing employees and reducing turnover

Kerri Wise

Key Takeaways:
A Tug-of-War exists in the car buying process. Today’s car buyer wants to maintain control of the process, using information and technology to help them with each decision. On the same token, some dealers also want to maintain control in order to protect their profitability and bottom line. The best dealers find a way to not only survive, but thrive in today’s transparent marketplace.

In this session, I will share insights and learning from a recent study of 100 transparent dealers that embrace transparency while enjoying the highest close rates in their respective markets. Specifically, this session will help you:

• Understand how top performing dealers understand and address consumer’s pain points in the car buying process

• Examine the tactics that top dealers are using to build credibility at each step of the process.

• Evaluate the impact that price transparency has on the bottom line of top performing dealers

Ken Schmidt

We’re not wired to be loyal to products or services, no matter how well they perform. We’re only capable of being loyal to people and to well-managed brands that successfully humanize their presence by creating emotional resonance with us. It’s time for your customers to evolve from “folks who buy from us,” into “loyal friends who recommend us without being asked,” which means your relationships with them have to evolve from superficial to meaningfully permanent. Customers come and go. But loyalists, like Harley-Davidson tattoos, become part of you and never leave. Building tattoo-worthy customer relationships isn’t the marketing department’s job; it’s yours. This is how it’s done.

You can apply Ken’s thought leadership at your store to:
• Develop an experience around your dealership brand that excites your customers.
• Stand out from the crowd of competitors by unifying your brand and your employees.
• Build an experience that drives repeat purchases in new vehicles, parts and service.

Originally Posted By Bradford Wernle at Automotive News

Thirty two years ago today, I walked in the door at Crain Communications as a newly hired reporter for a startup publication called Crain’s Detroit Business. Today, my 32nd anniversary, is also my last day working for the company that has given me so many opportunities. I am retiring to move on to new adventures.

In parting I’d like to recall some past adventures, thank a few people and offer an observation or two.

My Automotive News career began with a journalistic disaster. Strictly speaking, I became an Automotive News reporter one November day in 1994 when I boarded a creaky Air Ukraine Tupolev Tu-154 jet in Kiev, Ukraine, bound for the industrial city of Zaporizhia in the south of the country, one of the newly independent states of the former Soviet Union.

I had come to Ukraine on my last assignment for Crain’s Detroit Business, a sibling publication of Automotive News, where I had worked for 10 years. I spent a month in the gorgeous old Habsburg city of Lviv, Ukraine, teaching a class in journalism and communications at the Lviv Institute of Management, a fledgling business school. I wrote a series of stories for Crain’s Detroit about Ukraine’s efforts to move from communism to a market economy.

The flight to Zaporizhia was unnerving. As the plane climbed steeply aloft, the aisle carpeting, which wasn’t tacked down, slid past us toward the back of the airplane.

But I was determined to impress my new editors at Automotive News with my journalistic enterprise. I had arranged the trip to Zaporizhia to tour the factory of AvtoZAZ, a Soviet-era company that made two cars virtually nobody has heard of (justly so): the Tavria and Zaporozhets, a car with the nickname of the “hunchback” for its insect-like form.

Arriving at the factory, I saw dozens of people standing in the cold. My translator explained these were customers, who had come to take delivery of cars they had ordered months or years ago. One small problem: When I entered the plant manager’s office and introduced myself as a representative of the world’s top automotive trade paper, the gentleman politely declined to allow me inside for a tour.

Fortunately Editor Edward Lapham didn’t rescind my job offer after this fiasco. I fared better in Moscow, where I wrote a story about entrepreneur Mark Thimmig and Trinity Motors, the General Motors dealership he was running. Moscow was a wild west, gangster town in those days. We were chauffeured around the city in an armor-plated Chevrolet Caprice driven by an armed former special forces agent. One of the vehicles the dealership offered for sale was a Chevrolet Suburban outfitted by O’Gara-Hess & Eisenhardt Armoring Co.with inch-thick windows, AK47 gun ports in the doors and a button that would spray black oil on the windshield of any pursuing vehicle.

There have been few boring days since. A few random thoughts and thanks:

Big break No. 1: Not long after I joined Automotive News as marketing reporter, Lapham summoned me into his office to inform me he was adding a beat to my list of responsibilities. Our used-car reporter had resigned and Ed was assigning me to cover auto auctions and used cars. Seeing my crestfallen look, Ed hastened to cheerily reassure me: “Don’t worry, it will only take up 10 percent of your time.” Famous last words. That percentage was quickly turned on its head. Ed had just handed me a golden opportunity. I made my name nationally covering the advent of the CarMax and AutoNation used car superstores and the ensuing retail revolution.

Big break No. 2: One day in 1998, a typewritten notice was posted on the bulletin board at Automotive News. Automotive News Europe Editor Richard Johnson was seeking a reporter to fill a vacancy in London. It was an opportunity I had dreamed of since that first day in 1984 when I noticed Crain Communications had a London office. And so it was that I moved from covering the retail revolution to following Ford of Europe, Jaguar, Bentley, Land Rover, Volvo, Rolls-Royce and MG Rover. From winter testing Volvos on the frozen Gulf of Bothnia north of the Arctic Circle to driving Bentleys on the twisty roads of Tuscany, the job was a dream come true.

Biggest flop: The DaimlerChrysler merger. I took a whirlwind 36-hour trip from London to Frankfurt to New York and back to cover the massively hyped first day, which included a strange interview with a hyper, chain-smoking Juergen Schrempp and oddly subdued Bob Eaton. It was an epic mismatch of corporate and national business cultures.

A gentleman’s gentleman: I still miss former Ford Motor Co. COO, the late Nick Scheele, one of the kindest, smartest, toughest men I ever knew. During a lull in the activities on a media trip to open a new Ford Otosan Kocaeli plant east of Istanbul, Turkey, I leaned up against a railing and got fresh white paint on my suit jacket. Scheele, master of ceremonies on the big day, noticed my predicament. “Brad, you should know better than to touch anything at a car plant when corporate executives and politicians are in town for a visit,” said the then-chairman of Ford of Europe with a broad grin. “It’s highly likely there will be fresh paint around.” I scarcely had time to reply before Scheele told me he was going to find someone to clean the paint off my jacket. And sure enough, within moments, he returned with a man with a can of solvent and a white cloth to wick the paint out with a clean white cloth.

A diesel devotee disillusioned: I returned to Detroit after seven years at Automotive News Europe full of evangelical fervor for passenger car diesels. I preached tirelessly to skeptical friends about the incredible torque, effortless power, miserly fuel economy, quiet operation and virtually odorless exhaust. I still believe in oil burners, but to those friends who bought Volkswagen diesels at my recommendation, I apologize.

Generosity and legends: I got to meet a fair number of larger-than-life legends in the retail business including Red McCombs of Red McCombs Ford in San Antonio and Bert Boeckmanof Galpin Motors in Van Nuys, Calif. Many dealers were incredibly generous with their time and knowledge. To name just a few: Bill Wallace of Wallace Auto Group in Stuart, Fla.; Jim Seavitt of Village Ford in Dearborn, Mich.; and Don Lee, president of Lee Auto Mall in Auburn, Maine. They always gave me the straight story, regardless of whether it pleased the factories or not.

Most gut-wrenching story: Chrysler’s termination of 789 dealers during its 2009 bankruptcy. Their stories were heartbreaking. I never felt so helpless as a journalist.

Quotable: The auto industry needs more executives who know the world beyond its cloistered confines. Love him or hate him, FCA Chairman Sergio Marchionne is never boring -- quoting Albert Einstein, Charles Dickens, Niccolo Machiavelli and Ralph Waldo Emerson, among others. One of my favorites: talking to dealers about Chrysler’s financial health at the 2010 dealer announcement show in Orlando, Marchionne brought down the house when he said, “When I present figures like these, I am conscious of President Lyndon Johnson's admonition: 'Did you ever think making a speech about economics is a lot like pissing down your leg? It seems hot to you, but it never does to anyone else.’”

What scares me most: The 2008 and 2016 elections demonstrated how dangerous it can be when ill-informed politicians try boiling the intricacies of this uniquely complex industry down to Twitter-size soundbites. In the 2008-09 financial crisis, we came perilously close to losing General Motors and Chrysler to political grandstanding. In the recently concluded election, Bernie Sanders and Donald Trump railed against regional- and global trade agreements. Critics have a point. Trade agreements haven’t benefitted everyone equally. But the industry is global and badly needs consistent, carefully negotiated trading regimes to thrive. Without those, investments will freeze and momentum will stall.

And so: When I walked in the doors 32 years ago, I was a liberal arts major who saw business reporting as a mere way station en route to a more glamorous life as a music critic or arts writer.

What I have learned is that the auto industry is a mother lode of fascinating tales featuring an endlessly absorbing cast of dramatis personae.

All you have to do is figure out what beautifully sculpted, technologically groundbreaking machine customers are going to covet 3-5 years from now. Then you have to set vast teams of engineers, designers, purchasers, suppliers and marketers working feverishly on your new baby 24/7 and hope the arrow you shoot today hits its intended target in the still evolving future.

How difficult could that possibly be?

2016 is coming to a close, which means we spend a lot of time looking at our content from the year. We had lots of amazing blogs from the past year, but here is a look at the blog with the most views each month during 2016.

January: 3 Telltale Signs You Need To Modernize Your Auto Dealership  by James Patrick Kahler 

February: How Millenials View Your Dealership As An Employer?  by James Patrick Kahler

March: Life in the Car Biz, It’s a Journey Not a Destination by Jason Stum

April: The Power that Third-Party Website Relationships Bring to the Table by Seth Berkowitz

May: Trump Candidacy: Lessons for the Auto Industry by Mark Dubis

June: This Study About Millennials And Booze Will Help You Sell More Cars by Kyle Reyes

July: Let The Feet Do All The Talking by Jonathan Dawson

August: How to Handle the "Shop Around" Objection by Educating the Customer by Brian Maxwell

September: Nobody Wants To Work For A Living Any More by Kyle Reyes 

October: New Realities of the New Car Business  by Brian Finkelmeyer

November: Which Language Can Close Leads by Richard Rikess

December: Seven Things You Need To Know About People Waiting In Your Dealership by Maddy Low

What were your favorite DrivingSales blogs of 2016?

When you're in sales, you need something to make each day a little better. Which is why we love Sales Humor.  The only downside to Sales Humor is sometimes they are so accurate, they make us want to laugh and cry at the same time. Check out 10 of our favorite memes of 2016 from Sales Humor.

Check out the top 25 Sales Humor Memes here.

Published by the Natural Resources Defense Council: Part of NRDC's Year-End Series Reviewing 2016 Energy Developments

The drive to put cleaner vehicles on the road—and reduce climate-altering pollution and save drivers money—made significant gains in 2016.

New cars achieved record high fuel economy. New carbon pollution and fuel efficiency standards were put in place for heavy trucks, a large source of vehicle emissions. And efforts to increase the use of electric vehicles gained ground.

The gains are another signal of strong U.S. clean energy momentum that includes better efficiency in buildings and rapidly expanding renewable power.

But with this year’s advances to cut transportation carbon pollution comes uncertainty about the future of federal fuel efficiency standards under the new administration. You can be sure we’ll fight to keep them strong.

The progress made on the clean car front shows the value of the standards to our health, environment, economy and security. Consumers are already benefitting and will benefit more as the standards get stronger.

And the public strongly supports standards.

In an NRDC-commissioned poll earlier this year, 95 percent of Americans said they want car makers to keep improving fuel economy for cars and trucks and 79 percent said they want the government to keep increasing fuel efficiency standards. Support for higher fuel efficiency was shared by Democrats (97 percent) and Republicans (93 percent) alike.

Among the biggest achievements this year in the drive for cleaner cars were the records set by new vehicles: a new high for average fuel economy and a new low for carbon emissions.

New vehicles sold in model year 2015 averaged 24.8 miles per gallon, up 28 percent since model year 2004. They emitted an average of 358 grams of carbon dioxide per mile—a new low, and a 22 percent decrease from 2004.

New Automobiles are Getting Cleaner

Source: EPA, “Light-Duty Automotive Technology, Carbon Dioxide Emissions, and Fuel Economy Trends Report”, 2016.

Not only are standards working but automakers exceeded them. The pace of innovation is strong evidence that the 2025 target to nearly double fleetwide average fuel economy and cut emissions in half from 2004 levels--a standard that is projected to save drivers an average of nearly $4,000 over the life of a vehicle--is very achievable. 

This year’s progress is significant because transportation accounts for about a third of U.S. greenhouse gas emissions. In a number of states, transportation is the largest source of carbon pollution, ahead of power plants.

Among other achievements this year, the U.S. Environmental Protection Agency and U.S. Department of Transportation finalized new fuel efficiency standards for heavy trucks, including tractor trailers, buses, and delivery vans. They account for about 20 percent of transportation-related carbon pollution.

The standards will reduce fuel use of new heavy trucks by up to 25 percent by 2027. They will, when fully implemented, cut one billion tons of carbon pollution and save vehicle owners about $170 billion in fuel costs. And they will reduce oil consumption by up to two billion barrels over the lifetime of the vehicles sold under the program. 

Significant progress also was made this year to promote the use of electric vehicles, including a move in California to deploy the largest network of charging stations. 

The California Public Utilities Commission gave the go-ahead for Southern California Edison (SCE) and San Diego Gas & Electric (SDG&E) to install 5,000 charging stations in their service areas and Pacific Gas and Electric (PG&E) to deploy approximately 7,500 in northern and central California.

The moves represented an important step in meeting the state's goal of deploying infrastructure to support 1 million EVs by 2020.

Oregon passed legislation instructing its Public Utilities Commission to order electric utilities to propose programs and investments to "accelerate transportation electrification.’’ In New Jersey, where transportation is the largest single source of carbon pollution, a new campaign was launched to put more EVs on the road.

And the White House offered up to $4.5 billion in Energy Department loan guarantees to expand the network of charging facilities.

Deploying charging stations beyond single-family homes to sites such as workplaces and multi-family dwellings and alleviating drivers’ “range anxiety” (fear of running out of electricity) is critical to growing the EV market, according to an NRDC report, produced this year which spelled out the opportunities for the electric industry to drive carbon pollution out of the transportation sector.

Enthusiasm for electric vehicles also reached a critical point in 2016, as nearly 400,000 people put down $1,000 deposits for Tesla’s more affordable Model 3 electric car.

In the year ahead, we need to hold firm and resist attempts to weaken our fuel economy standards and continue to work aggressively to grow the EV market.

Clean cars are already cutting harmful pollution, saving drivers money, spurring innovation, creating jobs, and strengthen U.S. energy security.

This is a time to keep stepping on the accelerator, not the brakes. 

ORIGINALLY PUBLISHED BY AUTOMOTIVE NEWS

WASHINGTON -- A federal judge said Volkswagen AG has reached an agreement in principle to provide "substantial compensation" to the owners of about 80,000 3.0-liter polluting diesel vehicles, a key hurdle to resolve the German automaker's emissions scandal.

U.S. District Judge Charles Breyer, during a hearing today in San Francisco, did not disclose the amount of owner compensation, which is not included in a $1 billion settlement announced earlier this week between VW and U.S. regulators. Half of the compensation will be paid at the time Breyer gives final approval of the settlement. Some fixes for the 3.0 liters may not be approved until 2018, Breyer said. 

Earlier this week, Volkswagen reached the $1 billion settlement with U.S. regulators, offering to buy back about 20,000 of the vehicles, fix the remaining 60,000 and pay $225 million into an environmental trust fund to offset the vehicles' excess emissions.

The settlement covered luxury VW, Audi and Porsche vehicles with 3.0-liter engines. With the agreement, Volkswagen would spend as much as $17.5 billion in the U.S. to resolve claims from owners as well as federal and state regulators over polluting diesel vehicles in addition to compensation for the 3.0-liter owners. 

Volkswagen spokeswoman Jeannine Ginivan said the automaker was pleased with the agreement in principle, but said details will remain confidential for now.

Breyer said the final agreement must be filed with the court by Jan. 31, and he expects to hold a Feb. 14 hearing to approve the deal.

The U.S. Federal Trade Commission is also expected to back the deal, Breyer said.

Volkswagen, the world's No. 2 automaker, could still spend billions of dollars more to resolve a U.S. Justice Department criminal investigation and federal and state environmental claims and come under oversight by a federal monitor.

It is possible a deal could be reached before the end of the Obama administration, said sources briefed on the matter.

Breyer in October approved VW's earlier settlement worth about $15 billion with regulators and the U.S. owners of 475,000 polluting diesel vehicles with smaller 2.0-liter engines, including an offer to buy back all of the cars.

VW lawyer Robert Giuffra said today the automaker has offered buybacks to nearly 200,000 customers and 104,000 have accepted the offer at a value of nearly $2 billion.

VW had agreed to pay $5,100 to $10,000 in compensation to each of the U.S. 2.0-liter owners. If the new settlement follows the pattern, it could add $400 million to $800 million to the 3.0-liter settlement.

But funds from a separate settlement with German auto supplier Robert Bosch GmbH are expected to defray VW's compensation costs.

We’ve talked in an earlier post about people who are waiting in your dealership for their service to be completed, or to get their paperwork. One thing that you can do with the time that you have customers inside your dealership not actively shopping or participating, is hand them a survey. Waiting gives you an ideal opportunity to ask them to fill something out. Does this work, and how should you proceed? Check out our tips blow:

1. Charj has found that giving a survey to a customer while they wait can get you an 80% response rate. People in the dealerships are waiting for something to occupy their time. They may not seem excited about doing a survey at home, but if they’re just waiting for their car to get done, they’re much more likely to fill out the survey to pass the time.


2. If a customer can answer a survey with a device that isn’t their own, they are more likely to engage. If you ask customers to fill something out on their own phone, they don’t feel any immediacy to get it done. They’ll keep scrolling Facebook or texting their friends. If you give them a device with a survey already pulled up, they’re much more likely to take it seriously and respond instantly.


3. This instant survey response by the customer can lead to proactive containment of any negative feedback they could make online. If they’re not happy with something, they can fill out the survey to express frustration. Your team can then instantly look at the survey and try to address and fix the problem with the customer before they even leave.


4. Some dealerships reported to Charj that they have seen a 6% improvement in CSI when presenting customers with surveys in the lounge. This improvement comes from customers getting to vent, but still giving your dealership a chance to fix the problem or at least talk to the customer about it, face to face. People are more likely to relax when they see an actual person in front of them, who truly seems apologetic and eager to make things right. This is a better option than getting a survey after the customer has left, or seeing a bad review online.

Utilizing waiting rooms to benefit your customer experiences, and thereby making your dealership a better place for customers, will help your dealership succeed. Customers will be more satisfied, and you will be able to nip problems in the bud.

ORIGINALLY PUBLISHED BY AUTOMOTIVE NEWS

Honda R&D Co. has entered into discussions with Waymo, Alphabet Inc.’s new standalone company, to use technology that will enable self-driving capabilities in Honda vehicles.

If discussions lead to a formal agreement, Honda Motor Co. would become the second automaker to work with Waymo, formerly known as the Google self-driving car project. The talks mark another step in Waymo’s move towards commercialization of its autonomous technology.

The automaker said in a statement Wednesday that it is hoping to learn how Waymo’s sensors and software can be integrated into Honda vehicles through collaboration between both companies’ engineers.

As part of the potential agreement, Honda could also provide vehicles to Waymo’s self-driving fleet. The current fleet -- which Waymo published photos of on Monday -- is comprised of about 30 of Waymo’s own “Koala” cars and 100 Chrysler Pacifica minivans, provided by Fiat Chrysler Automobiles following a deal reached in May.

Honda has said that it plans to introduce vehicles with autonomous driving capabilities on public roads as soon as 2020.

Waymo introduced itself as an independent company last week.

At a press conference, Waymo CEO John Krafcik said it was in talks with automakers but could not disclose details. He added that the company would not manufacture vehicles on its own, but would focus on developing self-driving technology for purposes such as trucking, logistics, ride-hailing and licensing to automakers.

Teaming up vs. going alone

The moves illustrate how carmakers, faced with the high cost of developing autonomous driving tech in-house, are separating into those going it alone, such as General Motors and Ford Motor Co., and those teaming up to spread the costs.

Honda already has tie-ups with tech startups, notably with Southeast Asian ride-hailing service Grab.

It has been working alone to develop cars that can drive themselves on highways by 2020 while stressing vehicles will always require drivers. But it said it was interested in the approach of Google's self-driving car project -- now Waymo -- to develop fully autonomous, driverless cars.

"There's only so much technology a company can develop while focusing on one specific approach," Honda spokesman Teruhiko Tatebe told Reuters. "By approaching it from multiple angles it's possible to come up with new innovations quicker."

At the same time, technology firms such as Waymo have started to form partnerships with automakers to finally get their technology -- seven years in the making in the case of Waymo -- into more vehicles.

"You've got Google, which is engaging with another automaker to apply its technology into different vehicles and different platforms," said senior analyst Jeremy Carlson at researcher IHS Automotive. "From Honda's perspective, you get a close-up look at some of the most capable technology in the industry today."

Artificial intelligence

Honda has been developing automated driving functions and ways to connect vehicles to the internet, as well as artificial intelligence to enable vehicles to "think" while driving.

With Waymo, Honda said it may provide vehicles modified to accommodate the startup's software -- as Fiat Chrysler has done with its Chrysler Pacifica minivans. It also said there was potential for "close" cooperation between Honda and Waymo engineers.

A Waymo representative said the company was "looking forward to exploring opportunities to collaborate with Honda."

Reuters contributed to this report.