Dongfeng Honda Automobile, a Honda automobile production and sales joint venture in China, plans to build a third automobile production plant to meet increasing demand from the continuously growing car market in China.

The plans to build its third plant on a 1.2m square metre site approximately 8km (five miles) southeast of the company's first plant within Wuhan Economic & Technological Development District. Following a spend of CYN3bn (US$435m), the new plant is scheduled to start operation in the first half of 2019 with annual capacity of 120,000 units. The plant will be designed to accommodate production of electrified automobiles for which Chinese demand is expected to expand.

Since it began production and sales of the CR-V small SUV in April 2004, Dongfeng Honda has added the Civic (2006) and XR-V compact SUV (2015). This year it launched the redesigned Civic and the Gienia compact hatchback and expects 2016 sales to exceed 560,000 units.

The third plant will boost Dongfeng Honda's annual capacity to 600,000 units and Honda's overall automobile production capacity in China to 1.25m, including 600,000 from Guangqi Honda and 50,000 from the Honda Automobile (China) export-only plant.

Takahiro Hachigo, president, chief executive officer and representative director of Honda Motor, said: "Honda sales in China is going strong and annual unit sales for 2016 are expected to reach 1.2m. The Chinese market has potential for further development and growth."