Temple of VTEC Rumors and News - Honda to begin North American Fit production in 2014

$800 million Plant Will Produce Honda Fit Subcompact Model Starting in Spring 2014

This move should alleviate the Yen/$ exchange rate woes related to current Fit production. Press release below.

03/28/2012 - CELAYA, Mexico

Honda de Mexico, S.A. de C.V. (HDM) laid the foundation stone for the construction of its new vehicle production plant in Celaya, Guanajuato at an event attended by Felipe Calderon Hinojosa, president of Mexico and Takanobu Ito, president & CEO of Honda Motor Co., Ltd. The plant will begin operation in 2014 with production of the Honda Fit subcompact model.

With this new facility in Mexico, Honda continues to advance its commitment to invest and grow its operations in North America. With growing demand for fuel-efficient vehicles, the new plant will increase Honda's ability to meet customer needs for subcompact vehicles from within North America.

Expected to employ approximately 3,200 associates at its full annual capacity of 200,000 units, the new Honda de Mexico plant in Celaya will produce the Honda Fit subcompact model both for the Mexican market and for the U.S. and Canadian markets, as well as other regions.

"Considering the needs of the Mexican market, which is expecting continued growth in the future, and also serving as a global production base for the North American region and beyond, we decided to make the Fit the first product to be produced here," Ito said.

Also, we will create a highly efficient production system that allows us to provide high quality products at an affordable price both by expanding the use of local parts and by utilizing global parts sourcing," he said.

The new plant will occupy 5.66 million-square meters near Celaya, Guanajuato, about 210 miles east of two existing HDM plants in El Salto, Jalisco, which build automobiles, motorcycles and auto parts.

The Celaya plant will apply Honda's advanced and highly efficient manufacturing system to produce both vehicles and engines. The new Honda plant will be the company's eighth auto plant � and its 10th auto assembly line � in North America. The new plant 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 four auto plants, two auto engine production facilities and two transmission plants in the United States. In addition, Honda has two auto plants and an auto engine plant in Canada, and an auto plant in El Salto.

The new plant in Mexico will increase Honda's automobile production capacity in North America from 1.63 million units to 1.87 million in spring 2014. In 2011, more than 85 percent of the Honda and Acura cars and light trucks sold in the U.S. were produced in North America. In addition to region-specific models, including the Honda Odyssey, Pilot and Ridgeline, and the Acura TL, MDX and RDX, Honda produces key global models such as the Honda Civic, Accord and CR-V in North America. The addition of Fit production in Mexico means Honda will produce all four of its global models in North America.

Emphasizing Honda's commitment to environmental responsibility, 13 of Honda's 14 North American manufacturing plants operating in North America meet the ISO 14001 international environmental management standard.

About Honda De Mexico
HDM was established in September 1985, and began sales of motorcycle products in 1987. In March 1988, HDM started production of motorcycle products and automobile service parts in El Salto, Jalisco. An adjacent auto production plant opened in 1995 with production of the Honda Accord, switching to production of the Honda CR-V in 2007. HDM's current annual auto production capacity is 60,000 units.

About Honda in North America
Based on Honda's longstanding commitment to "build products close to the customer" Honda currently operates 14 manufacturing facilities in North America, producing a wide range of Honda and Acura automobiles, automobile engines and automatic transmissions, Honda all-terrain vehicles, and Honda power equipment products such as lawn mowers, mini-tillers and general purpose engines, using domestic and globally sourced parts.
Honda started local production in the U.S. with motorcycles in 1979. In 1982, Honda became the first Japanese automaker to produce passenger cars in the U.S. Honda has continued to expand its local production capabilities, and cumulative automobile production in North America surpassed 23 million units in 2011.

Our Perspective
For a U.S. viewpoint on Honda's new automobile plant in Mexico, please follow this link to "Our Perspective: A Perfect Fit � Honda's Growing Auto Production in North America," by Rick Schostek, Senior Vice President of Honda of America Mfg., Inc.