Honda to Build New Factory in China

Eventual production slated for 240,000 vehicles annually

Honda Motor said on Jan. 20 that it would build a new factory in China to meet brisk demand in the fast-growing nation.

Dongfeng Honda Automobile, the Japanese company's joint venture, will build a second factory in Wuhan, Hubei Province, aiming to start operations in the second half of 2012.

The venture will initially spend 1.15 billion yuan (US$170 million), to build the new plant, which will gradually increase its production capacity to as many as 240,000 vehicles a year, Honda said.

China's auto sales surged past those in the United States in 2009 to make it the world's biggest car market, and Japanese makers are competing for a slice of the pie to offset weak domestic sales.

Dongfeng Honda, which currently builds CR-V, the Civic and the Spirior, also plans to increase the annual production capacity of its existing plant by 40,000 vehicles to 240,000 units.

Dongfeng Honda has enjoyed robust sales, selling 211,000 vehicles in 2009, up 28.2% from 2008 and logging record sales for five straight years.

When Dongfeng Honda's second plant begins production, Honda's overall annual vehicle production capacity in China will reach 710,000 units.

Copyright Agence France-Presse, 2010

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