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Honda to Build New Automobile Plant in Mexico for Production of Subcompact Vehicles, Starting in 2014


EL SALTO 8/12/2011


EL SALTO, Jalisco, Mexico – August 12, 2011 -- Honda de Mexico, S.A. de C.V., (HDM), Honda’s production and sales company in Mexico, today announced that it will build an automobile plant for production of fuel-efficient subcompact vehicles for the Mexican and North American markets.  Honda will invest approximately US$800 million to build the plant, which is scheduled to begin operation in 2014.


Expected to employ approximately 3,200 associates at its full annual capacity of 200,000 units, the plant will occupy a 5.66 million-square-metre site in Guanajuato – a suburb of Celaya –
about 340 kilometres east of HDM’s two existing plants in El Salto, Jalisco, which build automobiles, motorcycles and auto parts.


The new Honda plant will apply Honda’s advanced and highly efficient manufacturing system to produce vehicles and engines.  By increasing use of local parts and materials, together with global parts sourcing, the new plant will provide customers with high-quality products at an affordable price. 


The plant will be the eighth Honda auto plant in North America – and its 10th auto assembly line – and will boost Honda’s capital investment in its North American operations to nearly US$21 billion.  Honda employs more than 33,000 associates in North America.  Production operations related to automobiles include two auto plants and an auto engine plant in Canada; four auto plants, two auto engine production facilities and two transmission plants in the United States; and an auto plant in El Salto.


The new plant in Mexico will increase Honda’s automobile production capacity in North America from the current 1.63 million units to 1.83 million units in 2014.  In 2010, more than 94 per cent of Honda and Acura cars and light trucks sold in Canada were produced in North America, while 87 per cent of vehicles sold in the U.S. were built in North America.


“With growing demand for fuel-efficient vehicles, this plant will increase Honda’s ability to meet customer needs for subcompact vehicles from within North America,” said Tetsuo Iwamura, president of American Honda Motor Co., Inc. and chief operating officer for Honda’s North America Region. 


“This new plant will further strengthen the foundation of Honda’s North American business by enabling Honda to more flexibly respond to changing market conditions from within the region.”


In North America, Honda produces global models such as Civic, Accord and
CR-V as well as region-specific light truck models including the Odyssey and Pilot.  The smallest automobile currently produced by Honda in North America is the compact Honda Civic, which is built at Honda assembly plants in Ontario and Indiana. 


In addition to the new auto plant in Mexico, Honda recently announced plans to expand production at several of its plants in Canada and the U.S.:
- Honda of Canada Mfg’s Plant 1, which builds the Civic Sedan, Civic Coupe, Civic Si coupe and Civic Si sedan, will return to full, two-shift operations in September. In May, the plant consolidated its two shifts into one-shift operation to cope with parts supply issues following the earthquake in Japan.
- In the U.S., the Honda plant in Greensburg, Indiana, which builds the Civic Sedan and Civic Natural Gas vehicle, will add a new second shift in October of this year.
- The Marysville, Ohio, auto plant which builds the Accord Sedan and Accord Coupe as well as the Acura TL, will reinstate second-shift production on Line 1 by the end of 2011, returning to full, two-shift production for the first time since January 2009.


Honda will make a significant commitment to limit the environmental impact of the new plant in Mexico.  The HDM plant will employ advanced methods of energy and emission reduction with the goal to become a “zero waste-to-landfill” factory. Already, Honda has 10 zero waste-to-landfill plants in North America, with four more operating with virtually zero waste-to-landfill, including the two existing plants in Mexico.


Further, every major Honda plant in North America has met the ISO 14001 international environmental management standards, except the new auto plant in Indiana which is now working toward certification.