Honda Motor Co. Ltd.
) worldwide production for the month of Oct 2013 stood at 419,232
units, increasing 21% from Oct 2012. Production outside Japan
escalated 23.4% to 328,525 units. Production in Japan escalated
13.3% to 90,707 units.
Higher production outside Japan was driven by a 71.6% increase in
production in Asia and a 7.5% rise in North America. This was
partially offset by an 11.2% decline in production in Europe and
a 6.7% decline in other regions. The year-over-year improvement
in Asia was mainly due to a 201.8% increase in production in
Japanese market sales went up 48.9% y/y to 65,337 units. New
vehicle registrations surged 90% to 38,008 units. Mini vehicles
sales augmented 14.4% to 27,329 units. Fit was the best selling
vehicle among new vehicle registrations in Oct 2013 with sales of
23,281 units. Step WGN was the ninth top selling vehicle with
sales of 5,304 units, followed by Freed, which sold 4,881 units.
Under the Mini vehicles category, N BOX was the best-selling
vehicle with sales of 17,599 units. N-ONE was the ninth
best-selling vehicle with sales of 5,522 units.
Export from Japan jumped 65.7% y/y to 11,401 units in October.
The increase was driven by higher exports to North America and
Others, partially offset by decrease in exports to Europe and
In separate news, Honda's production and sales subsidiary in
Brazil, Honda Automoveis do Brasil Ltda. (HAB), initiated the
construction of a new automobile production plant. The new plant
will be located in Itirapina, which is 200km northwest of the
city of Sao Paulo.
Honda's new plant will be operational from 2015 and will have
annual production capacity of 120,000 units. The company has to
invest ¥43 billion ($421 million) for the construction of the new
plant. The total investment includes cost associated with the
acquisition of the 5.8 million square meter site, purchase price
of equipment and construction charges of the plant building.
Honda, with the help of automation technologies, plans to create
an efficient production system at the new plant. The company will
use shorter production processes and latest painting technologies
to reduce environmental damage. With 2,000 employees, Honda will
initially be producing the all-new Fit vehicle in the plant.
Honda has a plant in Brazil at Sumare, which has a production
capacity of 120,000 units. With this new plant, the total
capacity of Honda in Brazil will double to 240,000 units.
Moreover, Honda plans to strengthen its local development
capabilities in Brazil. Thus, by the end of 2013, the company
will be launching a new automobile R&D center in the Sumare
plant. The R&D center will help Honda meet the product
requirements of local customers in Brazil. This will eventually
boost the sales of the company in South America.
Currently, Honda retains a Zacks Rank #2 (Buy). Stocks from the
same industry like
Tata Motors Ltd
Fuji Heavy Industries Ltd.
), each carrying a Zacks Rank #2 (Buy), are worth a look at the
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