Honda-The Power of Dreams
New Malaysian plant signals bigger role in "Made by Global Honda" automobile production network --- Prime Minister presides over Official Opening Ceremony

Pegoh, Melaka, January 30, 2003 --- With the official opening today of Honda Malaysia Sdn.Bhd.'s new state-of-the-art automobile production plant and the export of Constant Velocity Joint (CVJ) components already underway, Malaysia is set to play an increasingly important role in Honda's ASEAN and global automobile production network.

Speaking at the Official Opening Ceremony of the new RM170 million plant, which was presided over by Malaysian Prime Minister YAB Dato' Seri Dr. Mahathir Mohamed, Mr. Katsuro Suzuki, Senior Managing and Representative Director, Honda Motor Co. Ltd., said the new factory, equipped with Honda's cutting-edge flexible manufacturing systems, will act as an important focal point for Honda within ASEAN. "We aim to produce high-quality, cost-competitive products and components here to serve our customers in this region and beyond", he added.

Spread over 80 acres at the HICOM Pegoh Industrial Park in Alor Gajah, Melaka, the new Honda Malaysia plant boasts three zones ? the main plant which houses the automobile assembly activities and auxiliary buildings; a Constant Velocity Joint (CVJ) factory; and a completely-built-up (CBU) pre-delivery operation center. The plant also has its own test track built to Honda's international standards.

Prior to automobile production, Honda Malaysia's Pegoh plant began exporting CVJ components to Thailand last November and in 2003 expects to produce 122,000 car sets for the City, Civic, Accord and CR-V models. In addition to Thailand other planned export markets are Indonesia, the Philippines, India and Pakistan and by 2004 Honda Malaysia expects CVJ component production to increase to 173,000 car sets/year.

With an initial production capacity of 20,000 vehicles per year, the architectural-designed Honda Pegoh plant is equipped with flexible manufacturing systems to accommodate an increase in capacity and the production of new models to meet future demand. Currently employing 600 associates in a worker-friendly environment, the Honda CR-V is the first model to be produced, and is to be followed by the City, Civic and Accord by year-end 2003. Mr. Suzuki said Honda was committed to increasing local content and was actively encouraging Japanese parts manufacturers to consider investing in Malaysia to produce other advanced components such as electronic parts which would further extend Malaysia's industrial automotive infrastructure.


Mr. Suzuki also said that Honda sought to bring the benefits of ASEAN market liberalization both to its customers and to each host economy in a fair and balanced manner by building plants in each of the major markets and utilizing their economies of scale to transfer products and components between ASEAN countries under the existing intra-firm industrial complementary scheme. "We hope Honda Malaysia's new plant will play bigger role in ASEAN production network," he said, "and seek the Government of Malaysia's understanding and support for this important development so that we can produce here a model which can be exported to other ASEAN markets."

In line with Honda's philosophy of contributing back to the community in which it operates, Honda Malaysia Sdn. Bhd. pledges to the people of Melaka its commitment to assist the State Government by contributing up to RM300,000 to make Melaka into a garden city.

With the official opening of its Pegoh plant, the start-up of another automobile plant in Indonesia in March, the expansion of its automobile plant in Thailand and the completion of two new automobile component factories in Indonesia and the Philippines, by the end of 2003 Honda expects to have in place ASEAN's most competitive and comprehensive automobile production network, which will play an increasingly important role in its "Made by Global Honda" initiative. Under this initiative Honda is utilizing its most competitive global production and procurement resources to increase its efficiency, flexibility and speed of response to each individual market's requirements.



[About Honda Malaysia Sdn. Bhd.]

Established:
Capitalization Ratio:
  15 November, 2000
  Honda Motor Co., Ltd
  DRB-HICOM Berhad
  Oriental Holdings Berhad
 
  51%
  34%
  15%