In the next few years, China is saying that they are going to be investing billions of dollars into Hybrid technology. Honda is a automobile company who is well known for developing ad researching hybrid technology. They have been on the forefront of this new technology and for this reason they will be a top choice for this new hybrid technology. They will need to show the Chinese government that their technology is worth investing in. If they manage to do this, they will be bale to receive large amounts of money to use for the development of new hybrid technology.
The Chinese government is also aiming to put some millions of hybrid cars into use within China within the next few years. Seeing as how Honda is already producing hybrid cars, they will be able to expand and increase the production of these cars to fill the wishes of the Chinese government.
There are also however, restrictions being placed on car ownership is many large Chinese cities. This is to reduce congestion and traffic. This means that because of possible increases in taxes and/or legal restrictions, there may be a fall in demand for cars, which will result in Honda losing sales and perhaps revenue.
Oil prices have recently been rising and will most probably continue to rise as the world’s oil sources are depleted. This means that there will be a fall in demand for petrol cars and a rise in demand for Hybrid cars. On one hand, Honda produces a lot of hybrid technology and for this reason, they will be able to impose and introduce their new hybrid technologies, which will seem more attractive due to higher oil prices. On the other hand, the rise in oil prices will mean that consumers will be less likely to buy Honda’s petrol cars which means they will see a loss of revenue in this sector. This means that although Honda has Hybrid technology to offer, the fall demand for their petrol cars may cause them to break see no change in revenue (at least in the short...