Rising sales have prompted Honda to boost both car and motorcycle production in India
Honda Cars India (HCIL), Honda Motor’s automobile production and sales subsidiary in India will expand its second car production plant, the parent company in Japan announced on Friday.
Honda is also planning to expand its third motorcycle plant in India.
The car plant, in the Tapukara Industrial Area, Alwar district, in the state of Rajasthan in the northern part of India, was opend in February 2014, with annual production capacity of 120,000 units. HCIL will spend about INR3.8bn to extend the assembly line in 2016, bosting annual capacity 60,000 units to 180,000. This willl add about 600 jobs.
Total car production capacity will be 300,000 as the first plant in a separate location can build 120,000 a year.
Honda said auto sales in India last year rose 3% to 2.55m units while the market had grown 2.5 times in a decade. India is now the world’s sixth largest market including commercial vehicles.
Honda’s auto sales rose 67% to 180,000 units last year.
"This expansion of the second plant will increase HCIL’s overall annual production capacity... and will enable HCIL to continue accommodating the automobile market in India where further growth is expected primarily with small-sized passenger cars," the automaker said in a statement.
The newer plant in Tapukara has forging, casting, stamping, powertrain components production, welding, painting, resin moulding, engine assembly, and frame assembly as well as an engine testing facility - this is not a KD kit assembly operation by any means.
Both plants combined build the Brio, Amaze, Mobilio, City, Jazz and CR-V. Other models are imported.
Honda to Expand Motorcycle and Automobile Production Capacity in India
India, March 27, 2015 – Honda Motorcycle & Scooter India Pvt. Ltd. (HMSI), Honda’s motorcycle production and sales subsidiary in India, and Honda Cars India Limited (HCIL), Honda’s automobile production and sales subsidiary in India, have each decided to expand annual production capacity in line with the expected continued future growth of the Indian market. HMSI will expand its 3rd motorcycle production plant, and HCIL will expand its 2nd automobile production plant, both currently under operation.
HMSI Motorcycle Expansion
HMSI’s 3rd motorcycle production plant, located in the Narsapura area in the state of Karnataka in the southern part of India, became operational in June 2013, with annual production capacity of 1.8 million units. HMSI will newly invest approximately 5.85 billion rupee and build another production line within the existing site. The new production line is scheduled to become operational in 2016 and expand annual production capacity by 600,000 units, increasing the plant’s total annual production capacity to 2.4 million units. In order to accommodate this capacity expansion, HMSI is planning to increase the number of associates by approximately 1,900.
In 2014, industry-wide motorcycle sales in India increased approximately to 16 million units, a year-on-year increase of approximately 10%. In the same year, Honda motorcycle sales increased to approximately 4.2 million units, a year-on-year increase of approximately 30%. Combined with the additional capacity of the 4th plant which is scheduled to become operational in the first half of 2016, this expansion of the 3rd plant will increase HMSI’s overall annual production capacity to 6.4 million units. With this capacity expansion, which will make HMSI Honda’s largest motorcycle assembly plant in the world, HMSI will be well prepared to continue serving the motorcycle market in India where further growth is expected primarily with scooter products.
HCIL Automobile Expansion
As for automobile business, HCIL’s 2nd automobile production plant, located in Tapukara Industrial Area, Dist. Alwar, in the state of Rajasthan in the northern part of India, became operational in February 2014, with annual production capacity of 120,000 units. HCIL will newly invest approximately 3.8 billion rupee to further strengthen the plant with facilities such as the extended assembly line. These measures will be taken in 2016 and expand the annual production capacity by 60,000 units, increasing the plan’s total annual production capacity to 180,000 units. In order to accommodate this capacity expansion, HCIL is planning to increase the number of associates by approximately 600.
In 2014, industry-wide passenger automobile sales in India increased to approximately 2.55 million units, a year-on-year increase of approximately 3%. In the last 10 years, the market has grown approximately 2.5 times, making India the world’s 6th largest automobile market when sales of commercial vehicles are included. In the midst of such market growth, Honda has been introducing all-new models such as the diesel-powered the City and the Mobilio and maintaining strong sales. In fact, cumulative sales of the Amaze quickly reached the 100,000-unit milestone in August 2014, only 16 months after the start of sales. In 2014, Honda’s automobile sales increased to approximately 180,000 units, a year-on-year increase of approximately 67%. This expansion of the 2nd plant will increase HCIL’s overall annual production capacity to 300,000 units including the 120,000-unit capacity of the 1st plant and will enable HCIL to continue accommodating the automobile market in India where further growth is expected primarily with small-sized passenger cars.
HCIL’s automobile production plant in Tapukara, integrates facilities with various functions including operations for forging, casting, stamping, powertrain components production, welding, painting, resin molding, engine assembly, and frame assembly as well as an engine testing facility. The plant has a layout with an optimized automation system and employs the latest equipment to pursuit efficient operation. From the perspective of high product quality and ergonomics, the production efficiency and safety of each operation performed at the plant is continuously being improved.
|Head office location:||IMT* Manesar, Gurgaon District, Haryana|
|Capital investment:||3.1 billion rupee|
|Capitalization ratio:||100% Honda Motor Co., Ltd.|
|Representative:||Keita Muramatsu, President & CEO|
|Business:||Production and sales of motorcycles|
|Production capacity:||4.6 million units / year
(1st plant: 1.6 M units, 2nd plant: 1.2 M units, 3rd plant: 1.8 M units)
4th plant: 1.2 M units -- scheduled to become operational in 1st half of 2016
|Production models:||Activa, Activa i, Aviator, Activa 125, Dio, Dream Neo, Dream Yuga,
CD110, CB Twister, CBF Stunner, CB Shine, CB Unicorn,
CB Unicorn 160, CB Trigger, CBR150R, CBR250R
|Head office location:||Greater Noida, Uttar Pradesh|
|Capital investment:||7.7 billion rupee|
|Capitalization ratio:||73.6% Honda Motor Co., Ltd.
26.4% Asian Honda Motor Co., Ltd.
|Representative:||Hironori Kanayama, President & CEO|
|Business:||Production and sales of automobiles|
|Production capacity:||240,000 million units / year
(1st plant: 120,000 units, 2nd plant: 120,000 units)
|Production models:||Brio, Amaze, Mobilio, City, Jazz, CR-V|
Original source: Honda Motor