International development

Honda begins construction of new plant in Brazil

honda plant.jpg

Honda Automoveis do Brasil Ltda. (HAB), the Honda automobile production and sales subsidiary in Brazil, this week held a ceremony to mark the start of construction of its new automobile production plant in the city of Itirapina in the state of Sao Paulo (approximately 200km northwest of the city of Sao Paulo).

The ceremony was attended by approximately 300 guests, including the Governor of Sao Paulo State, government and community officials, suppliers to Honda, as well as Takanobu Ito, President and CEO of Honda Motor Co., Ltd.

With an annual production capacity of 120 000 units, the new plant is scheduled to become operational in 2015. Including the acquisition of the 5.8 million square metre site, the purchase of equipment and construction of the plant building, the total investment for the new plant is expected to be approximately 1 billion Brazilian Reais (approximately 43 billion yen). The new plant will employ approximately 2 000 associates.

HAB plans to begin production at the new plant with the all-new Honda Fit*, and then increase the model line-up for production of Fit*-class compact vehicles, for which demand is high on a global basis. As a part of HAB’s efforts to address environmental concerns, the new plant will employ shorter production processes and introduce latest technologies in the painting process. Moreover, HAB will strive to establish a highly efficient production system at the new plant through various approaches including optimal use of automation technologies.

Combining the production capacity of the new plant with the existing plant in Sumare, HAB’s total annual automobile production capacity will double from the current 120 000 units to 240 000 units. Moreover, with the goal to strengthen local development capabilities in Brazil, Honda is establishing a new automobile R&D centre within the plant in Sumare, which will start full-scale operations by the end of this year. The strengthened local development capability will enable Honda to deliver an increasing number of attractive products developed to accommodate the needs of local customers in Brazil. With the enhancement of the product line-up and doubling of the production capacity, Honda will further expand its automobile sales in South America.

 

Honda President and Ceo, Takanobu Ito, says: “As the world’s fourth largest market, Brazil is one of the most important markets in the world for Honda. We are building up our local R&D capabilities, and together with this new auto plant, we will continue to deliver products ‘with speed, affordability, and low CO2 emissions’ that exceed the expectations of our customers in Brazil.”

 

Honda began motorcycle business in Brazil in 1971 and production in 1976. Honda’s cumulative investment in motorcycle business has reached approximately 3.7 billion Brazilian Reais. Honda’s automobile production in Brazil started in 1997, and Honda’s cumulative investment in automobile business in Brazil, including this new plant, will reach approximately 3.5 billion Brazilian Reais. Furthermore, aiming to be more proactive in using renewable energy to minimize the environmental footprint of its business activities, Honda has invested approximately 100 million Brazilian Reais (approximately 4.3 billion yen) for a wind power generation business. The construction of the new wind farm, which will be operated by Honda Energy do Brasil Ltda., started in October 2013, and is scheduled to become operational in September 2014. The wind farm is expected to generate electricity which is equivalent to Honda’s current annual electricity needed for automobile production in Brazil (approximately 95,000 MWh).

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