Guangqi Honda Automobile, a Honda production and sales joint venture in China, has announced plans to expand its annual production capacity from the current 360,000 units to 480,000 units ‘in order to meet continuously growing demand in the Chinese market.
Guangqi Honda’s current overall production capacity of 360,000 units includes 240,000 units at the HuangPu plant and 120,000 units at its ZengCheng plant. The company has decided to double the annual capacity at ZengCheng to 240,000 units by the second half of 2011.
To expand its production capacity, Honda said ZengCheng would add new equipment. There will also be improvements to the “complete wastewater recycling system,” which was introduced to this plant in 2006.
Honda said total investment for this expansion is expected to be approximately CNY930m. Guangqi Honda’s total employment is expected to be increased from the current 6,800 to 8,000.
Guangqi Honda began production in March 1999 with the Accord. Since then the company has expanded its product lineup by adding the Odyssey in 2002, Fit (Jazz) in 2004 and City in 2006. In addition, the Crosstour will be added to the lineup before the end of 2010, and sales of the LI NIAN brand vehicle, Guangqi Honda’s proprietary automobile brand, is scheduled to begin in 2011.
Guangqi Honda’s 2009 sales reached a record 365,000 units (up 19% over 2008). Honda said year to date sales (January through April 2010) reached 134,000 units, up 36% compared to the same period a year ago.
Combining Guangqi Honda’s capacity expansion and the addition of Dongfeng Honda’s second plant, scheduled to begin operations in the latter half of 2012 with annual production capacity of 60,000 units, Honda’s overall annual automobile production capacity in China will be expanded from the current 650,000 units to 830,000 units by the second half of 2012.