Hodaka in actuality began in 1961 as Pabatco in Athena, Oregon. Pabatco (Pacific Basin Trading Company) was a division of fertilizer distributor Farm Chemicals of Oregon which did business through trading goods with Yamaguchi of Japan. By 1963 some 5000 motorcycles were distributed by 480 dealers. In April of 1963 Yamaguchi went backrupt leaving Pabatco and Yamaguchi's engine supplier, Hodaka Industrial Company of Nagoya, Japan in financial difficulties. Pabatco, knowing the market of trail riders, designed the motorcycle and Hodaka adapted its factory to to manufacture and assemble it.
The initial Hodaka trailbike was designed and tested in the Oregon mountains and in 1964, the first Hodaka Ace 90 came off the assembly line. It was a street-legal, single-cylinder, two stroke engine, a double-downtube frame, and utilized the features of other makers such as Dot, Cotton, and Greeves. The cost was modest at $379.
Pabatco/Hodaka did not create models yearly but kept the same basic design and changing only by engineering innovation or public demand. Simple machines, Hodakas came in only in the color red to eliminate overhead in paint and storage. In 1965, Shell Chemical, a division of the Royal Dutch Shell Oil Company, purchased Farm Chemicals of Oregon.
- In June 1966, Hodaka had made 10,000 Ace 90 motorcycles and two Ace 90s had traveled the perimeter of Baja Mexico.
- Jim Pomeroy won the Motocross Grand Prix in Portugal in 1973
- Sammy Miller (world's trials champion) rode Hodakas in competition
- Harry Taylor won the 100cc road race at Daytona 200 in 1968
In January of 1970, Hodaka produced the Super Rat 100, a strictly off-road bike and street legal Hodaka Super Rat 100B for around $500. In 1972, Hodaka followed up their success with the Hodaka 125cc Wombat. Following the Wombat was the Hodaka Combat Wombat, a more serious racer.
Hodaka began falling during the 1970s in sales as the much larger Japanese makers began making their mark in the American market with more than trail bikes. Also, Hodaka parts were obsolete components or leftovers from Yamaha, Honda, etc. The death nail was the economic downturn of the late 1970s. Shell attepted to buy Hodaka but Hodaka refused to sell. Shell in turn did not renew the manufacturing contract and Hodaka was closed. The tooling was sold to Daelim, a South Korean company to make utiitarian motorcycles for Asia.