Honda said to plan China capacity boost on auto sales

Honda Motor Co., Japan's second- largest carmaker, will expand capacity at a venture in China by as much as 200,000 vehicles a year, according to two people familiar with the matter.

The partnership with Guangzhou Automobile Group Co. will increase annual capacity from 360,000 vehicles, according to the people, who declined to be identified as the plans are private. Honda Chief Executive Officer Takanobu Ito will hold a press conference in China on May 25, they said.

Toyota Motor Corp. and Nissan Motor Co. have also begun work on boosting China capacity as economic growth spurs demand in the world's largest auto market. Nationwide sales may grow more than 10 percent this year, Honda's Ito said last month.

Honda has three car factories in China and is preparing to open another with Dongfeng Motor Group Co. in Wuhan in the second half of 2012. Guangqi Honda Automobile Co., the venture with Guangzhou Auto, builds Accord sedans, Odyssey minivans, Fit compacts and City compacts.

The Japanese carmaker may increase China sales 9 percent this year to 630,000 vehicles, Ito said last month. It plans to introduce the Accord Crosstour wagon in China this year and models under the new Li Nian brand by early next year.

Honda gained 1.5 percent to 3,075 yen in Tokyo trading today. The automaker has lost 1.1 percent this year.

Nissan plans to boost capacity in China to 900,000 vehicles a year by 2012 and to expand further after that, CEO Carlos Ghosn said last month. Toyota, the world's biggest carmaker, will start building Corolla cars at a factory in Changchun in the first half of 2012, it said on April 28.