Honda to Expand Capacity in China

Sales in China rose 31% in April

Japan's number two automaker Honda Motor said on May 25 it would boost annual production capacity in China to 830,000 vehicles by 2012 to meet ever-rising demand in the world's biggest car market.

Manufacturing capacity at Guangqi Honda Automobile Co, a joint venture with China's Guangzhou Automobile Group, will rise by a third to 480,000 vehicles in the second half of 2011 from the current 360,000, Honda said.

The expansion at its Zengcheng plant in southern China, which will cost about 930 million yuan US$136 million), will help it "meet continuously growing demand in the Chinese market", the company said.

The company said in January it would build a new plant with annual capacity of 60,000 units by 2012 for its other joint venture in China -- Dongfeng Honda Automobile Co. The venture currently produces 240,000 vehicles a year.

Honda also runs a separate facility that produces 50,000 units a year for export to overseas markets.

Its bigger rival, Toyota Motor, said last month it would open a new factory with an annual capacity of 100,000 units to raise its capacity in China to 920,000 vehicles by 2012.

Honda sold 576,223 vehicles in China last year, up 23% from the previous year. Its sales in China rose 31% in April from a year earlier to 55,113 units.

Copyright Agence France-Presse, 2010

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