Honda Motor Co. said on Jan. 7 it plans to delay the start of operations at a new car plant in Argentina by about half a year until mid-2010 due to the economic crisis. "The Argentine market has been slowing amid the global economic slump. The Brazilian market, which is supposed to be a major export destination of cars manufactured at the plant, is also shrinking," a company spokeswoman said.
Honda, the second largest automaker in Japan, is investing $100 million to build the plant in the central state of Buenos Aires. It is to employ 800 people and produce 30,000 cars a year, which is equivalent to about 5%-6%of Argentine demand, the spokeswoman said.
Despite the delay in the start of operations, Honda will proceed with the plan to build the factory in the belief that demand for automobiles in South America will expand in the long term, she said.
In December, Honda cut its full-year profit forecast by more than half, its third revision downwards in the year.
It has also announced a pullout from Formula One, saying it could not stay in the prestigious racing tournament due to the dire state of the global economy.
Copyright Agence France-Presse, 2009