The mighty yen is an Achilles heel in the foot of many Japanese companies, which explains their welcome production arrival to these shores. Right now, Honda builds the Civic Hybrid in Japan—but by early 2013, they’ll be rolling off the line in sunny Greensburg, Indiana.
The Indiana factory opened in 2008 to build Civics, which it does at the pace of 250,000 per year. But Honda is investing $40 million and boosting capacity by 50,000 units, which will be good for an additional 400 jobs by the end of this year (up from the 2,000 it already employs). The expansion aims to add greater production flexibility and the option of building other models. And already it’s doing this with Acura, which assembles the ILX and ILX Hybrid there and has made the Indiana factory add a second shift to meet demand.
“Our team in Indiana has successfully managed many challenges in its first four years, including the launch of three all-new models and the expansion of our production capacity is a result of their efforts,” said Bob Nelson, senior vice president at Honda. “We are excited about these new opportunities for our plant, because it shows that the customer is embracing the products we make here in Indiana.”
So the hybrid experience in Indiana comes readily. Which will be a boon for Honda, as Indiana will be the only source of Civic Hybrids around the planet. Honda also recently expanded its production capacity at its Lincoln, Alabama, minivan and SUV manufacturing facility by 40,000 trucks to 340,000 vehicles per year. And around North America, Honda expects to build 1.72 million cars per year and export many of them out of the country, because it’s far cheaper than the other way around.
This comes right at the time Honda’s fortunes are flying high again: after pointed criticism and earthquake woes, its sales have climbed 15 percent this year, keeping pace with the market’s growth. Already the Civic is on track to sell more this year than it did at this point last July, with 162,582 sold so far. And with American production of the pricier hybrid model, Honda will ensure that prices for the Civic stay steady no matter how far the yen goes.
Source: Automotive News