Honda to close one of its assembly plants in China, halt production at another facility later this year

Honda to close one of its assembly plants in China, halt production at another facility later this year

Earlier this month, it was reported that Honda was shuttering one of its production plants in Thailand, and now, it is set to do the same in China. The Japanese automaker said it was closing one of its assembly plants and would halt vehicle production at another facility in the country later this year, Reuters reports.

A company spokesperson told the news agency that the company will close one of the four plants it operates through its joint venture with Chinese state-owned automaker Guangzhou Automobile Group (GAC) in October. It assembles the Accord sedan at the No.4 facility, which was opened nearly two decades ago and has an annual production capacity of 50,000 vehicles.

It will also pause production at another factory it operates in the country through a separate JV with Dongfeng from November. That facility, one of three it operates with Dongfeng, has an annual production capacity of 240,000 vehicles. As a result of this, the company’s annual production capacity in China will shrink from 1.49 million units to 1.2 million units.

The spokesperson said that with the changes, the automaker is seeking to optimise its output in China amid tough conditions brought about by heavy competition from Chinese brands. However, it’s not all gloom, as the company is planning to regain traction – and numbers – by shifting its focus towards electric vehicles.

Dongfeng Honda (left) and GAC Honda’s new dedicated EV plants.

Honda plans to bring annual production in China back up to 1.44 million vehicles by starting production at two EV plants it is presently building through its JVs with GAC and Dongfeng, with production expected to begin at both new plants later this year.

The GAC Honda EV plant, located within the Guangzhou economic and technological development district, will have an annual production capacity of 120,000 units. Likewise, the new Dongfeng Honda dedicated EV facility, which is located in the Wuhan economic development zone in Hubei Province, will also have a basic annual production capacity of 120,000 units.

Honda and Nissan are among Japanese brands for which China has been a historically strong market. There has however been a change in their fortunes with the rise of domestic automakers, which are offering low-priced, software-loaded vehicles in droves. The news about the carmaker’s Chinese plants comes after the Nikkei first reported yesterday of Honda’s plan to slash its annual production capacity in China by around 30%.

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Anthony Lim

Anthony Lim believes that nothing is better than a good smoke and a car with character, with good handling aspects being top of the prize heap. Having spent more than a decade and a half with an English tabloid daily never being able to grasp the meaning of brevity or being succinct, he wags his tail furiously at the idea of waffling - in greater detail - about cars and all their intrinsic peculiarities here.

 

Comments

  • Jeremy on Jul 26, 2024 at 5:10 pm

    For the first half of 2024, the Japanese automaker’s cumulative sales dropped to 415,906 vehicles at China, down 21.48% from the previous year ?

    if calculate, 415,906 2024 1H sales, is much less than 1.2 million annual capacity after 2 factory close shop.

    Like or Dislike: Thumb up 1 Thumb down 0
  • this must be fake news, not possible, honda is king XD

    Like or Dislike: Thumb up 0 Thumb down 0
 

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