Honda-The Power of Dreams
Honda To Build Transmission Plant in Georgia As Part of $270 Million North American Powertrain Strategy
-- Investment Includes Expansion at Existing Plants in Ohio and Alabama --

ATLANTA, U.S.A., November 9, 2004 - Honda today announced plans to build a US$ 100 million plant in the city of Tallapoosa, Ga., 40 miles west of Atlanta, to produce automatic transmissions as part of a broader North American Powertrain Strategy.  The plan also includes significant investments to add production of high precision gears at a Honda transmission plant in Ohio, and key engine components at a Honda engine facility in Alabama.  In all, Honda will invest US$ 270 million and create 600 jobs across three states.



“This powertrain strategy represents the continuation of Honda’s 25-year commitment to localize our operations close to the customer here in the U.S., and creates a new level of autonomy for Honda’s powertrain production in America,” said Koichi Kondo, president of American Honda Motor Co., Inc., and chief operating officer of Honda’s North America Region operations.  “Importantly, the growing experience of Honda associates in America is what enables us to take this next step in powertrain production.”

In Georgia, Honda will invest US$ 100 million to construct its 13th major plant in North America, a new 250,000 square foot plant that will begin assembly of automatic transmissions in fall 2006.  At full capacity, the plant will employ 400 associates and produce 300,000 transmissions per year.  Reflecting Honda’s strategy to base powertrain production near vehicle production for synchronous assembly, the plant will initially support production of Honda Odyssey minivans and Pilot SUVs at Honda Manufacturing of Alabama, LLC (HMA) in Lincoln, Ala., 60 miles west of the Tallapoosa plant.

In Ohio, Honda will invest US$ 100 million and add 100 new jobs to expand Honda Transmission Mfg. of America, Inc., (HTM) in a move that will result in the transfer of the value-added production of high precision gears from Japan to Ohio.  As the new Georgia plant begins production, HTM will gradually shift responsibility for transmission production for the Alabama plant to the new Georgia plant and phase-in the new responsibility for gear production.  The expansion will increase HTM’s capital investment to more than US$ 261 million, employment to 900 associates and plant size from the existing 361,000 square feet to 631,000 square feet. 

In Alabama, HMA will invest US$ 70 million and add 100 new jobs to begin machining additional engine components at its existing engine plant operations.  These components are currently supplied by Honda of America Mfg.’s Anna Engine Plant in Ohio and Honda’s Mohka Plant in Japan.  HMA began operations in 2001 and, today, has the capacity to produce 300,000 vehicles and V6 engines per year.  HMA’s total investment exceeds US$ 1 billion.

Honda currently has an annual production capacity of one million automatic transmissions in the U.S. and has assembled more than nine million transmissions in America since it began producing automatic transmissions at Honda of America Mfg.’s Anna, Ohio, Engine Plant in 1989.  HTM assumed responsibility for transmission production in 1996. 

Honda’s first U.S. powertrain operation – the Anna Engine Plant – completed a US$ 20 million expansion in July 2003, adding a new assembly line that further increased its flexibility to produce both 4-cylinder and V6 engines.  The Anna Plant now has a capacity of 1.16 million engines per year.  Together, Honda’s Ohio and Alabama engine plants have annual production capacity of 1.46 million automobile engines and supply all Honda and Acura vehicles produced in North America.

Honda recently celebrated the 25th anniversary of its first U.S. manufacturing plant, September 10, 2004. Collectively, these latest investments will bring to more than US$ 8.5 billion the amount Honda has invested in its North American production, R&D and marketing operations. Using domestic and globally-sourced parts, Honda now has the annual capacity to produce 1.4 million cars and light trucks in North America at five auto plants in the U.S., Canada and Mexico.

Honda began operations in the U.S. in 1959 with the establishment of American Honda Motor Co., Inc., Honda’s first overseas subsidiary. Honda now employs more than 30,000 associates in North America. Honda currently has 12 manufacturing plants in North America, producing automobiles, light trucks, motorcycles, all-terrain vehicles, personal watercraft, engines, transmissions and other components. Nearly 8 of 10 Honda and Acura cars and light trucks sold in America are produced in North America as well. Many of these products are now designed and developed at one of Honda’s U.S. R&D centers. Honda annually purchases more than US$ 12 billion in parts and materials from suppliers in North America.