Honda-The Power of Dreams
Honda Philippines Begins Mass Production at New Motorcycle Plant

Metropolitan Manila, Philippines, May 22, 2006 – Honda Philippines, Inc., Honda’s subsidiary for motorcycle production and sales as well as power product sales in the Philippines, announced the start of mass production at its new motorcycle plant in Tanawan City, Batangas Province.

HPI decided to move its original plant in February in response to increasing customer demand, and began construction of the new plant in March. With the new facility, HPI's annual production capacity increased from 300,000 units to 500,000 units. Located 60 km south of the former plant, the new plant has a potential capacity of 1 million units with additional modifications.. The building area is 42,000m2 of a 200,000m2 lot. Total investment was 1.43 billion pesos (approximately 3 billion yen). Machinery and equipment from the old plant were fully utilized in the new plant, with the addition of a new painting line. An environmentally-friendly layout is employed for the new plant, including natural lighting. Efficiency has been improved in each process along the production line as well as in logistics. It is expected that production quality also will be improved and HPI hopes to achieve a higher level of customer satisfaction.

The company plans to use the former plant site for expansion of a traffic education center to increase Honda’s safety-related activities in the Philippines in response to the growing market.

The overall motorcycle market in the Philippines has been growing rapidly, reaching 580,000 units in 2005, a 22% increase from 2004. The market is expected to grow further in 2006, up to more than 700,000 units.

Honda established HPI in 1983, achieving the cumulative production of 1 million units in February, 2005. Including XRM and Wave 100, the key products of HPI, total sales reached approximately 290,000 units in 2005, a 42% increase from 2004. Sales for the first four months of this year totaled approximately 94,000 units and represent a 6% increase from 2005. Honda’s goal is to meet the growing customer demand with expanded production capacity from the new plant.

Honda Philippines, Inc.
Established: December 1983
Start of Production: December 1983
Location: Batangas, Philippines
Capital Investment: 640,860,000 pesos
Capitalization Ratio: 99.61% Honda Motor Co., Ltd.
Representative: Kazuhiko Ikezoe, President
Business: Production and sales of motorcycles, sales of power products
Employment: Approx. 530 associates (as of January 2005)
Annual Capacity: 500,000 units (as of January 2005)
Production Models: XRM(110cc),Wave 100(100cc), Wave125(125cc),TMX155(155cc), XR200(200cc) and other products