Honda Civic Hybrid production will shift to the U.S. as part of the maker's big North American build-up.
Honda Motor is adding additional capacity at its plant in Indiana as it shifts more production and more responsibility to its operations in North America.
In addition, it expects to double its exports of finished vehicles from the United States to other parts of the world by the middle of the decade, a senior Honda official said Wednesday.
Honda’s North American plants will export about 100,000 units this year to markets in Europe, South America and Asia, Rick Schostek, senior vice president of Honda of America Mfg., Inc., said during an appearance at the Automotive Press Association.
“That number will double in the next couple of years,” he said, noting that as recently as 2011, Honda’s operations in the U.S. exported just 53,000 units beyond North America.
Honda, which was the first Japanese maker to produce cars in the U.S. – with the opening of its original Marysville, Ohio plant in 1982 – hit a milestone when it produced more vehicles in North America than in Japan last year.
Honda’s production in the U.S was 823,000 units, compared with 710,000 Japan units – though that was largely the result of the March 2011 earthquake and tsunami that all but halted Japanese production for several months. But the trend was moving that way even before the disaster. In 2010, Japan was only slightly ahead of North America, and the trend is now clearly set.
“Nine of the 10 Honda and Acura vehicles we sell in the U.S. will be built here,” added Shostek, who said the company’s North American operations will also take on a larger role in the development of key models such as the mid-sized Honda Accord.
As part of the continuing expansion of capacity in the U.S. and North America, Honda said it was investing $40 million to increase annual production capacity by 50,000 units to a total of 250,000 vehicles at just its plant in Indiana. That factory will hire approximately 300 new production associates later this year in preparation for the increased production that will start early next year, Shostek said.
As part of the expansion, Honda will add production of the Civic Hybrid, its most popular hybrid model in the United States. Indiana was the first Honda plant in North America to build a gas-electric vehicle when it started Acura ILX Hybrid production in April.
These latest announcements follow the start of a second shift of production last fall at Honda Manufacturing of Indiana that added approximately 1,000 jobs.
Since late last year, Honda’s seven automobile production plants in North America have been operating at or above their full straight-time capacity, which currently totals 1.63 million vehicles per year. In addition to the new second shift at the Indiana plant, Honda’s plant in Marysville, Ohio resumed second-shift production on Line 1 late last year.
Last November, Honda Manufacturing of Alabama, LLC announced that it will increase capacity by 40,000 units to 340,000 light trucks per year, starting this fall. This increase, plus the additional 50,000 units at Honda Manufacturing of Indiana, will increase Honda’s North American auto production capacity to 1.72 million units per year.
The additional capacity at Honda Manufacturing of Indiana also will result in increased purchasing from among more than 200 suppliers that manufacture parts and components for the plant’s production, mostly located in the Midwest.
In addition, Honda announced last spring it planned to build a new assembly plant in central Mexico, which is slated to open in 2014. That factory will produce, among other things, the subcompact Honda Fit.
The expansion in Mexico and Indiana will raise Honda’s total production capacity in North America, including Mexico and Canada, to 1.92 million units by the middle of the decade.