Wuhan, August 8, 2003 – Honda Motor Co., Ltd. has begun a new automobile production joint venture with Dongfeng Motor Corp. in China -- Dongfeng Honda Automobile (Wuhan) Co., Ltd. -- for the production of Honda vehicles. An existing plant in Wuhan, Hubei will be upgraded to serve as the production site for Honda’s small SUV, the CR-V, with production slated to start during the first half of 2004. The annual production volume has been set at 30,000 units.
A new joint venture company, Dongfeng Honda Motor (Wuhan) Co., has been established with Honda assuming 50% of the shares of Wuhan Grand Motor Co., Ltd., which owns the vehicle production plant in Wuhan, Hubei. The equipment at this plant will be upgraded and enhanced for the 2004 production start-up. This will include the introduction of new welding and final quality control processes as well as improvements to the existing assembly and painting equipment, a total investment of approximately 44 million U.S. dollars. Employment will total approximately 600 associates.
In 1994, Honda and Dongfeng Motor established a joint venture automobile parts production company, Dongfeng Honda Automobile Parts Co., Ltd. (Huizhou, Guangdong), with the understanding that producing engines and complete vehicles was a future possibility. In 1998, as a part of a passenger car production project in Guangzhou, Honda and Dongfeng Motor established Dongfeng Honda Engine Co., Ltd. to produce engines for the Accord and Odyssey models.
Honda is pursuing this production project in Wuhan in accordance with the Chinese government’s policy guidelines for the automobile industry, in order to meet the expanding demand and diversifying needs of the Chinese automobile market which is expected to continue to grow rapidly in the future.
Outline of the new joint venture company
|Name of the company||:||Dongfeng Honda Automobile (Wuhan) Co., Ltd.|
|Capital||:||28 million U.S. dollars (about 3.4 billion yen)|
|Capitalization Ratio||:||Honda Motor Co., Ltd.
|Dongfeng Motor Corp.||50％|
|Location||:||Economic & Technological Development District, Wuhan, Hubei|
|Employment||:||About 600 associates (at the start of production)|
|Model to be produced||:||CR-V|
|Production volume:||:||30,000 units/year|
|Production start:||:||First half of 2004|