China demand boosts Honda's global production

Shanghai, February 23 (Gasgoo.com) Honda Motor raised its global auto production in January as demand surged in China's auto market, now the world's largest, Bloomberg reported today.

Honda Motor, the second-largest Japanese carmaker, produced 290,752 vehicles last month, up 28% year on year. Like Nissan Motor, Honda has been expanding capacity in Chinese ventures to meet surging demand in the nation, which surpassed the U.S. as the world's biggest auto market in 2009.

An analyst has said that global auto demand will grow in 2010 on a modest recovery in the U.S. market and robust sales in emerging markets driven by China and India. Japanese carmakers are in a good position as the worst has passed in the global auto industry.

Sales of passenger and commercial vehicles in China more than doubled in January from a year earlier to 1.66 million units, as the nation's economic growth and government incentives spurred auto demand.

Last month, Honda's local venture with Dongfeng Motor Group said it will invest 1.15 billion yuan ($168 mln) to build a second plant in China that will begin production by late 2012, with an annual capacity of 240,000 Honda-brand vehicles.

Honda will also boost production capacity at the venture's existing plant in cenral China's Hubei province to 240,000 vehicles later this year from the current 200,000.