When Honda last month said it would invest $US100m to increase production capacity at its Sumaré car plant, in São Paulo state, it announced only part of its plans.

Now we know the money will also go towards making the eighth generation Civic sedan here in Brazil. The model was recently launched in the US along with a coupe while hatchback versions are about to be launched in Europe and elsewhere.

Production of the new Civic, based on the US version, will start in Brazil in the end of the first quarter of 2006. Local sales will start at the end of May.

The Brazilian-made sedan have the new 1.8-litre-VTEC engine.

Next year, too, Honda will launch a flexfuel version of its Brazilian-made Fit hatchback (Jazz in Europe). It will be the company's first flexfuel vehicle.

Sumaré can now produce 65,000 vehicles a year but expansion plans will take capacity to 80,000 units by the beginning of 2007 and to 100,000 units in 2008.

The plant was opened in 1997 and currently produces the previous-generation Civic sedan and the Fit line.

Rogério Louro

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