Honda de Mexico has celebrated the start of construction of its new transmission plant in Celaya, near the city of Guanajuato. The new plant will be next to the new car assembly plant – under construction – that will begin production of the redesigned 2015 Fit [Jazz] early in 2015.
The US$470m transmission plant will begin producing continuously variable transmissions (CVTs) in the second half of 2015 with an initial annual capacity of 350,000 units.
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Honda plans to more than double annual output of CVTs produced in Celaya to approximately 700,000 annually in the coming years, when employment is expected to reach 1,500 new workers. In addition to supplying the Mexican car factory, the plant will also provide transmissions to Honda plants outside Mexico – the automaker has four auto assembly plants in the US and two in Canada.
“Our ability to begin operations would be impossible without the enthusiasm and support of the community, and I want to thank the state and federal governments for their efforts to help ensure the success of our operations,” said Tetsuo Iwamura, COO of Honda North American Regional Operations.
“With the growing skills of our new associates in Mexico we are establishing a new production base that will achieve outstanding global competitiveness.”
The ceremony concluded with placement of a first stone for the building’s foundation, officially signifying the start of the transmission plant building’s construction.
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By GlobalData“By establishing a production base for CVT manufacturing in the same location as the new $800m auto plant, Honda de Mexico will operate a highly efficient production structure that maximises local content in Mexico, the rest of North America and globally,” the automaker said in a statement.
It will employ around 4,700 workers in Celaya when the auto, engine and transmission plants are in full operation.
The CVT transmissions to be produced in Celaya are part of Honda’s new ‘Earth Dreams Technology’ series claimed to achieve both sporty performance and a high level of fuel efficiency.
The new transmission plant in Mexico will join existing Honda transmission manufacturing operations in Ohio and Georgia, increasing Honda’s annual transmission production capacity in North America from the current 1.375m units to more than 1.7m units in 2016, and to more than 2m units when the plant reaches full capacity.
Honda established its first Mexican manufacturing operations in September 1985. Two years later, Honda de Mexico started motorcycle import sales and, in March 1988, began production of motorcycle products and automobile service parts in El Salto, Jalisco. Automobile production began in 1995 with the Accord and, in 2007, production switched to the CR-V. The auto plant in El Salto has an annual capacity of 63,000.
With the new 200,000 unit Celaya automobile plant scheduled to begin operation early next year, Honda de Mexico’s annual production capacity will increase to 63,000 units. In 2012, Honda sold 54,000 units in Mexico (up more than 150% from 2011), with sales volume steadily increasing.
With the production start-up of the new Fit in Mexico next year, Honda in North America will be manufacturing automobiles for all sales segments, from sub-compact to light truck models. In addition to expanding capacity, the automaker is introducing Earth Dreams Technology powertrains in its Honda and premium Acura brand products.
In the last three years, Honda has announced investments in North America totaling nearly $2.7bn for the innovation and expansion of its operations, including $1.27bn for the new plants in Celaya.
