Honda’s urgent need for a sixth assembly plant in North America at a yet to be announced location has sent local governments scrambling to woo the Japanese automaker and the jobs it would bring to town, according to Reuters.
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Representatives from Indiana and Ohio both told the news agency they have been in negotiations with Honda about its plans for the plant to meet the growing demand for its cars.
Honda said on Wednesday it would build a new assembly plant with capacity of 200,000 units at an investment of US$400m. The plant is planned to become operational in 2008 and employ around 1,500 people.
It is still in the process of selecting a location but Japanese sources have suggested that Honda is seeking a site close to one of its existing three assembly plants in the US. The new plant will bring Honda’s assembly capacity in North American up from the current 1.4m units to 1.6m.
Indiana governor Mitch Daniels, who scored a win in March by getting Toyota to agree to shift production of its Camry sedan to a Subaru plant in Lafayette, told Reuters he had been in talks with Honda for several months.
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By GlobalData“The state is hopeful of being selected for this investment, which is significantly larger than earlier news reports indicated,” Daniels reportedly said in a statement. “Indiana will do all it can to compete successfully to be (Honda’s) next home.”
Reuters noted that the competition to lure Honda’s expected investment and the thousands of jobs that would follow a new car plant comes a day after the US Supreme Court rejected a challenge to an earlier tax credit Ohio granted in order to land a Jeep plant.
Mark Rickel, a spokesman for Ohio governor Bob Taft, confirmed to the news agency that state was talking to Honda about adding a third plant in the state.
Ohio could be the frontrunner to land the new production plant, IRN automotive analyst Erich Merkle told Reuters.
“I have to put Ohio really at the front,” Merkle said, citing Honda’s already substantial presence in the state.
Reuters noted that Honda opened its first US assembly plant in Marysville, Ohio, in 1982 and opened a second plant in the state in 2000 in East Liberty, where it builds the Element light truck.
Honda also has a plant in Alabama, one in the Canadian province of Ontario and one in the Mexican state of Jalisco.
Reuters added that the Canadian Press news agency quoted unnamed industry sources in reporting that Honda had “all but ruled out” Canada for the assembly plant and favoured Alabama.
