RTTNews - Honda Motor Co. Ltd. will spend $800 million on a third automobile plant in Mexico to make fuel-efficient subcompact cars for the North American markets, said the Japanese car maker on Friday.
Honda's production and sales company in Mexico, Honda de Mexico S.A. de C.V., or HDM, will build the plant with an annual capacity of 200 thousand units. The plant scheduled to open in 2014 will thus increase Honda's automobile production capacity in North America from the current 1.63 million units to 1.83 million units.
Honda did not provide details of the subcompact car which it plans to produce in the new plant in Mexico.
The new plant is expected to employ about 3,200 associates and will occupy a 5.66 million square meters site in a suburb of Celaya, Guanajuato, about 210 miles east of HDM's two existing plants in El Salto, Jalisco.
"With growing demand for fuel-efficient vehicles, this plant will increase Honda's ability to meet customer needs for subcompact vehicles from within North America," said Tetsuo Iwamura, president of American Honda Motor Co., Inc. and chief operating officer for Honda's North America Region.
The plant will be the eighth Honda auto plant in North America and will boost Honda's capital investment in its North American operations to nearly $21 billion. Honda employs more than 33,000 associates in North America.
In 2010, more than 87 percent of Honda and Acura cars and light trucks sold in America were produced in North America.
HMC is currently trading on the NYSE at $33.61, down $0.07 or 0.21%, on a volume of 0.6 million shares.
