Honda-The Power of Dreams
Honda Announces Business Plan for CY2003

Tokyo, December 18, 2002 --- Honda Motor Co., Ltd. today announced its business plan for calendar year 2003, including Honda's plan to increase its customer base from the 2002 forecast of 15.27 million to 17.35 million customers in 2003.

Honda announced its mid-term business plan in July 2002, calling for an even stronger commitment to its global activities aimed at providing new value-added products for 20 million customers in the fiscal year ending March 31, 2005.

Based on its mid-term plan, in 2002 Honda completed revamping the production operations at its major automobile plants in Japan, the U.S., and Europe to its "New Manufacturing System," enabling those manufacturing lines to respond more quickly and flexibly to changes in the marketplace. Capitalizing on these improvements, Honda has utilized its worldwide resources to steadily expand "Made by Global Honda" activities which ensure procurement and production in the most efficient locations to achieve quick delivery to customers.

In 2003 Honda plans to invigorate its entire worldwide operations through "global networking," with the type of energy and vitality inherent in Asia, where the market is expected to continue to expand. Based on the concept and activities of "Made by Global Honda," Honda aims to achieve motorcycle sales of 9.25 million, automobile sales of 3.1 million, and power product sales of 5 million - resulting in a total of 17.35 million customers in 2003.



Major Plans by Business Category

Motorcycle Operations:
Japan
A new 50cc city-commuter model with unique styling will be launched. The model will be the 4th product created by the "N Project," which has helped develop new markets by offering new values.
More reasonably priced made-in-China products will be supplied as a follow-up to the Today model, the first Chinese-made Honda scooter sold in Japan.
The CBR600RR, developed based on technologies used in the RC211V, winner of the 2002 Moto GP World Championship, will be introduced in Japan as the new standard for Honda's sports model line-up. It will also be marketed in other countries in Europe and North America.

"Made by Global Honda
In addition to products made in China and Thailand, motorcycles made in India and Brazil will be exported to various countries around the world.
The number of models being shared globally, on a complementary basis between regions will be increased from currently about 20 models to more than 30 models.
A new motorcycle R&D center in Shanghai will begin operations in April 2003.

Providing new products with high added value
In spring 2003, the 125cc and 150cc Pantheon scooters equipped with fuel injection systems will go on sale in Europe. The newly developed PGM-FI fuel injection system for small displacement engines will be gradually expanded to models for other markets around the world.

Automobile Operations:
Japan
In spring 2003, Honda will import to Japan two light truck models produced in North America, the MDX sport utility vehicle and the new Element.
A new upscale sedan model will be launched, equipped with state-of-the-art technologies, including Honda's new accident-avoidance safety technology.
The sales force will be increased to over 14,000 people.
A new dealer system utilizing IT will be established to create a more efficient sales structure.
In fall 2003, annual production capacity in Japan will reach 1.35 million units, achieving higher flexibility in mini-vehicle production.
  - The daily production capacity of the four lines at the Suzuka Factory and the Saitama Factory will be increased to 1,100 vehicles in early 2003, with the Suzuka Factory's #2 line to be eliminated in January 2003.
  - Honda and Yachiyo Kogyo will implement Honda's flexible New Manufacturing System innovations at Yachiyo Kogyo's production line by fall 2003, to increase its daily production capacity to 1,000 vehicles.

North America
In spring 2003, a new sports sedan model will be launched on the Acura channel.

Europe
In addition to the new Accord and the Accord Wagon, the Accord Diesel will be introduced at the end of 2003.
The new diesel engine, independently developed by Honda and to be installed in the Accord, will be manufactured at the Tochigi Center of Honda Engineering.

Asia
Mass production of the CR-V will start in January 2003 in Taiwan at a new plant 100% owned by Honda. First year production volume is set at 20,000 units.
Mass production will begin at new automobile plants in January in Malaysia and in March in Indonesia.
A complementary product supply network will be established among Honda operations in Thailand, Indonesia and the Philippines.
The production capacity at Honda's Thai plant will be expanded from the current 70,000 units to 120,000 units by mid 2003.
China
  - The production and sales of the Fit Saloon (known in Japan as the Fit Aria) will start next summer at Guangzhou Honda in China for the domestic Chinese market.
  - The production capacity at Guangzhou Honda will be increased to 120,000 units in February 2003, with an additional expansion to 240,000 units in spring 2004.
The export of powertrain components from the Philippines and Indonesia to Europe will begin in fall 2003.

South America
In Spring 2003, the production and sales of the Honda Fit will begin in Brazil.
The production capacity at the Brazilian plant will increase from 30,000 units to 50,000 units in spring 2003.

Small Car Series
More than 500,000 small-car series models built on the Global Small Platform will be sold globally in 2004.

Power Product Operations:
The annual production capacity of the plant in Thailand has been increased from 400,000 units to 1 million units in November 2002, with exports to Europe and North America to begin in 2003.
Products in the home-use category will be aggressively marketed in Japan, including a personal-use mini-tiller, and a home-use hybrid snowplow model.
The sales of a compact, home-use energy cogeneration system unit will begin in Japan in spring 2003.