Honda plans to build a new plant in Thailand, with an annual production capacity of 120,000 units.
The new facility will be located on the property which Honda recently bought in Prachinburi Province, neat Bangkok. The automaker will invest almost $644 million, which includes the price for the land acquisition and construction of the plant. The facility is expected to begin production in 2015, with an initial number of 1,200 employees.
In order to establish a highly efficient production system Honda Automobile Thailand will resort to processes for shortening production and will introduce the latest production technologies, new welding and painting equipment. The plant will initially manufacture small and sub-compact sized vehicles, which see an increasing demand in all markets.
Honda has also increased production capacity at its Ayutthaya plant in Thailand to 280,000 units annually from 240,000 units, by adding new equipment and upgrading the existing one. The automaker plans to make another investment to further increase production at this plant to 300,000 units in 2014. This means that Honda will manufacture 420,000 units in 2015 in Thailand from the combined capacity of the two plants.
Honda’s shares increased 3.3% in more than a month and closed at 3,580 yen today, February 6th. The benchmark Nikkei 225 Stock Average added 3.8% and closed at the highest level seen since September 2008.