The strong Japanese yen has determined manufacturers to find new ways of distributing their cars around the world.
Honda for instance, has started to export the Fit compact car (known as the Jazz in Europe and other markets) from a Chinese plant to Canada. Until recently, the Honda Fit was imported to Canada from Japan, although Honda has been shipping China-made cars to Europe for some time. Honda explains the move is not primarily determined by the yen, but by maximizing production capacity.
According to a spokeswoman for the company, Honda is trying to have each of its global production bases shoulder responsibility for exports so that they can help each other adjust fluctuations in demand and increasing or reducing exports to other regions as needed.
Before the March disaster in Japan and the floods in Thailand, Honda had used its production base in Japan as a buffer to adapt to changes in global demand, varying export volumes from there. Now the carmaker aims to reduce the Japan’s portion of production for exports to 10%-20% of total output over the next 10 years from the 30%-40% ratio Japan now has. The same plan applies to Honda’s global factories, which must be able to export about 10%-20% of their output.