Honda Unveils Ambitious Sales Targets

Published May 26th, 2000 - 02:00 GMT

Japan's Honda Motor Co. Ltd. Friday unveiled aggressive sales targets as it unveiled a major plan to boost output at home and overseas. 

A new manufacturing system would be introduced this autumn in Japan, Britain and the United States to reduce costs by 100 billion yen (935 million dollars) over the next four years, Honda president Hiroyuki Yoshino said. 

"This new system will increase speed by reducing the time needed to bring a new model to mass production or to add an existing model to a different plant," he told a briefing.  

Japan's second biggest automaker blamed a strong yen as it reported on May 12 a 14.0-percent fall in net profit to 262.4 billion yen (2.4 billion dollars) for the year to March 31.  

A central plank of the new medium-term plan is to boost local production to beat the currency trap, Honda said.  

The firm said it was targeting global car sales of three million by March 2004, a rise of over 500,000 from the past fiscal year.  

Honda, the world's biggest motorcycle and engine maker, said motorbike sales would increase by 2.6 million to seven million units over the period.  

Sales of power products including general-purpose engines were targeted to soar by half to six million, the company said.  

Start of production at Honda's new US plant in Alabama, which will make the Odyssey minivan, has been brought forward from the spring of 2002 to late next year, Yoshino noted. 

The company's second facility at its Swindon plant in southern England would come on-stream next spring to roll out the new 2001 Civic car, he said.  

"We also plan for improvements and increases in production at other Honda factories in China, India, Brazil, Thailand and other emerging markets," the president said.  

The new manufacturing system would boost flexibility at plants.  

"For example, manufacturing flexibility at the Sayama and Suzuka plants in Japan will increase from a maximum of five to eight on any one line," Yoshino said.  

"This will enable Honda to produce the Civic, Accord or any other future models at any of our major plants worldwide with minimal lead-time."  

The British operation would begin to export outside Europe and some of its parts procurement would shift to continental Europe, the president said. 

Honda's Turkish plant would ship parts to eastern Europe. 

No new European plants were planned to help Honda beat the pound's strength against the euro, and the firm planned "to improve efficiencies and reduce costs at our plant in the UK" rather than cut output, he said.  

Honda said last month that it would temporarily cut production at its Swindon plant owing partly to the pound's strength, but added it wanted to raise local production in Europe to more than two-thirds of overall sales. 

Honda's new Indian plant being built outside New Delhi would add to motorcycle production out of Vietnam to meet soaring demand for two-wheelers in Southeast Asia, the company said.  

New models may be produced in China, the president said.  

Honda would enhance its green credentials through its development of hydrogen fuel-cell technology with General Motors Corp. of the United States, he added.  

Honda this week agreed to install GM's "OnStar" in-car information terminals in selected US models, and the two were in talks over GM's planned XM Satellite Radio digital broadcast service for motorists, Yoshino noted -- TOKYO (AFP) 

© 2000 Al Bawaba (www.albawaba.com)

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