home > news

Honda to double China capacity on rising sales

260508, Beijing. Honda Motor Co, Japan's second-largest auto maker, will double the capacity at its Chinese venture with Dongfeng Motor Group Co within two years because of rising sales in China.

The venture will be able to build 240,000 vehicles a year, Atsuyoshi Hyogo, senior managing director in charge of Honda's China operations, said in an interview with Bloomberg News yesterday in Tokyo. The move will raise Honda's total capacity in the country by 23 percent to 650,000 vehicles.

Honda aims to boost sales of CR-V sport-utility vehicles, Civic compacts and other models in China by 15 percent this year, as economic growth spurs demand. The car maker is banking on emerging market sales growth to offset slumping demand in North America, where it earns about 70 percent of operating profit.

"Honda has a big chance in these regions, thanks to its fuel-efficient models and strong brand image," said Hitoshi Yamamoto, chief executive officer of Fortis Asset Management in Tokyo, which manages US$5.5 billion in Japanese equities.

Dongfeng Honda Automobile Co, which makes CR-Vs and Civics, plans to raise sales 18 percent this year to 150,000 vehicles.

Honda, which has another Chinese venture with Denway Motors Ltd, aims to raise its total sales in the country to 492,500.

China's passenger car sales rose 18 percent in the first four months of the year to 2.46 million.

Dongfeng Honda's expansion plans still need government approval, Hyogo said.

Source: Shanghai Daily.