Honda CEO
Takahiro Hachigo said the company would focus its manufacturing efforts on
electric vehicles.
Japanese
automaker Honda is shuttering its Sayama plant, north of Tokyo, in 2022 as the
company shifts its focus to the production of electric vehicles.
CEO Takahiro
Hachigo outlined the company’s plans today saying that due to sluggish auto
sales in Japan, the company needed to reduce production levels and refocus on
EV manufacturing to meet the ever-toughening demands of different markets
around the globe.
The closure of
Sayama pushes the company toward its goal of cutting capacity by 24% in Japan.
It will shift the plant’s output to its site in nearby Yorii, as well as most
of the employees. The Sayama plant was capable of producing more than 250,000
vehicles annually, as is the Yorii site.
The overall
vehicle output will drop to 810,000 units from 1.06 million, Reuters reported.
“As we focus
more on adopting electrification and other new technologies, we want to hone
our vehicle manufacturing expertise in Japan and expand it globally,” CEO
Takahiro Hachigo told a press conference.
The Yorii
plant will also act as the center of electric vehicle production for the
automaker, which has been slow to take on EVs as a critical part of its
portfolio. However, it now wants two-thirds of its production to be electric
vehicles by 2030.
“Japan needs to take a
leading position in manufacturing, including in vehicle electrification,” said
Hachigo. “We will consider how to apply these processes to other plants
globally.”
Yorii will be positioned as
a global center for electrified vehicle production. It will serve as a template
for overseas manufacturing as Honda launches more hybrids and EVs overseas.
A longtime EV skeptic, Honda
announced in June that it had established an Electric Vehicle Development
Division to create EVs based on dedicated all-electric platforms. That is a
departure from Honda’s current stance.
To date, Japan’s
third-largest carmaker mostly has dabbled with small-volume cars for regulatory
compliance while rivals such as Nissan rolled out mass-market nameplates, and
others, such as Ford and Volkswagen, announced big plans for electrification
across their lineups.
Toyota Motor Corp., another
EV latecomer, joined the bandwagon last year with its own EV development
division. And last week, it announced plans for a joint venture with Mazda
Motor Corp. and supplier Denso Corp. to create an electric architecture.
Recent concept vehicles show
what Honda has planned.
At the Frankfurt auto show
last month, the company debuted its hatchback-style Urban EV Concept that
previews a compact city runabout planned for sale in Europe in 2019.
At the Tokyo show later this
month, Honda will unveil the Sports EV Concept, a small, rear-slung performance
EV based off the same platform.
Honda also is developing an
electric car for release in China next year.
Tale of
two plants
Honda opened its
cutting-edge Yorii factory in 2013 with capacity for 250,000 vehicles.
It makes the Vezel, known
overseas as the HR-V subcompact crossover, as well as the Fit subcompact
hatchback and derivatives including the Grace sedan and Shuttle wagon.
Yorii also makes the Civic
for the domestic market.
Honda unveiled plans to
build Yorii in 2006, and the plant was supposed to be churning out cars by
2010. But the global financial crisis upended that plan.
Construction started in
2007. Then the project was delayed twice as the economy fell apart and the
rising yen challenged the wisdom of building a factory in high-cost Japan.
Former Honda President
Takanobu Ito resurrected the project in 2010.
Yorii’s lines boast some of
the latest production methods, with the company positioning it as a kind of
petri dish for pioneering new manufacturing technologies.
At the opening of the Yorii
plant, Honda said its more efficient manufacturing technologies slashed 30
percent off assembly costs, compared with the older Sayama plant.
Sayama, which has capacity
for 250,000 vehicles a year, focuses on larger vehicles such as the Odyssey
minivan, Accord Hybrid sedan, Jade wagon, Freed minivan and the Acura RLX.
Sayama’s vehicles will be shifted
to Yorii or Honda’s Suzuka assembly plant in central Japan.
As part of the production
shuffle, Honda will take full ownership of its minicar subsidiary Yachiyo
Industry Co. It makes the sporty S660 minicar alongside commercial
minivehicles.
“Honda will largely evolve its
production operations and product development,” Hachigo said.
“The
automobile industry is undergoing an unprecedented and significant turning
point in history. That’s why Honda is undertaking new technologies such as
electrification and intelligence technologies.”
Like its
primary rival, Toyota, Honda has been a late adopter of EVs. However, it has
been making up for lost time. Last month at the Frankfurt auto show, the maker
unveiled its Urban EV Concept, a small city car expected to go on sale in
Europe in 2019.
DATA RECEIVED FROM
HONDA AND NEWS BUREAUS.
WHEN WE LEARN
MORE AND CAN VERIFY FUTURE EV
PRODUCTION
WILL REPORT FINDINGS.
BRUCE HUBBARD
AUTO ADVISOR GROUP
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