Honda Motor said subsidiary Honda de Mexico will build a CVT automatic transmission plant alongside the car plant it is constructing in Celaya, near Guanajuato, Mexico. The complex will start Fit [Jazz] production in spring 2014.
Initial spend is US$470m and the transmission plant will begin operation in the second half of 2015 with annual capacity of 350,000 units, with plans to more than double annual output in the coming years.
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Employment of 1,500 new workers is expected when the plant reaches its full capacity of about 700,000 units.
“By establishing a production base with outstanding global competitiveness in CVT manufacturing in the same location as the new automobile plant, Honda de Mexico will establish a highly efficient production structure that maximises local content in Mexico and the rest of North America,” the automaker said in a statement.
The new transmission plant, Honda’s third in North America, will produce continuously variable transmissions (CVTs) for vehicles built in Mexico, where further market growth is expected, as well as for other Honda car plants in North America and globally.
When the new plant reaches full production, transmission capacity in North America will exceed 2m units and will support the automaker’s capacity to produce 1.92m automobiles per year in the region, Honda added.
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By GlobalData“We are establishing a production base with outstanding global competitiveness in CVT production in the same location as our new automobile plant in Celaya,” said Tetsuo Iwamura, COO of Honda North American regional operations. “As we continue to advance our commitment to build products close to the customer, we appreciate the strong support we have received here in Mexico.”
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.
Car production began in 1995 with the Accord and, in 2007, production switched to the CR-V SUV. Honda de Mexico has current capacity of 63,000.
With the new 200,000-unit Celaya automobile plant scheduled to begin operation in February 2014, Honda de Mexico’s annual capacity will increase to 263,000. In 2012, Honda sold 54,000 units in Mexico (up 150.6% year on year) with sales volume increasing steadily.
The Mexico transmission plant will join existing operations in Ohio and Georgia, increasing Honda’s annual transmission production capacity in North America from the current 1.375m units to over 1.7m in 2016, and to more than 2m when the Mexican plant reaches full capacity.
