Honda Ohio Plants to Receive $335 Million in Upgrades
Honda is reportedly spending $335 million to upgrade its operations in Ohio to counter the problems it has been dealing with since its supply chain was disrupted from the Japan earthquake in March, and currency exchange rate issues. The automaker was studying the possibility of building more plants closer to its customers, and this huge investment may be the first step.
Of the $355 million, $166 million is going to its East Liberty plant, and $64 million is going toward a stamping press at its Maryville plant. Honda, however, wouldn't specifically disclose how much it's spending in additions to its engineering center in Raymond.
The Raymond center is Honda's main vehicle-development plant for the Americas, where models like the Pilot, Acura MDX, Ridgeline pickup, Acura ZDX wagon and TL sedan, and the North American version of the Odyssey are designed and engineered. The facility is also home to Honda's crash-test center, laboratories, and wind tunnel, which was built in 2010.
But perhaps the most important buzz around the Raymond center is the work engineers have to do to meet the new CAFE standard. The Obama Administration recently announced all vehicles must comply with the 54.5 mpg standard by 2025, with the first step calling for automakers to develop cars that reach an average of 35.5 mpg by 2016.
In addition to the Ohio upgrades, Honda said in March it would spend $94 million to renovate its Lincoln, Ala., plant that assembles the Odyssey and Pilot. A whopping $800 million is going toward a new plant in central Mexico that will produce 200,000 sub-compacts a year after the assembly line starts producing cars in 2014.
While it may seem like Honda is getting ready to put more cars on the lots, a Honda spokesman would not say whether the U.S. investments would lead to greater overall output.
According to company data, output at Honda's plants in the U.S., Canada and Mexico plunged by 26 percent to 559,981 this year through July from 754,807 the same period a year ago.
Source: Automotive News (subscription required)