Honda to set up plant in Pingtung

Honda Taiwan Co (台灣本田), wholly owned by Japan's Honda Motor Co, will start manufacturing Honda-brand cars in Taiwan by the end of this year, with an annual output of 20,000 units initially, a top executive of the company said yesterday.

Honda Taiwan president Teruo Fujisaki (藤崎照夫) said multiple-purpose vehicles will be the first to roll off the company production line in Taiwan. Yesterday's press conference was Honda's first since severing a 41-year partnership with Taiwan's Sanyang Industry Co (三陽工業) in January of this year.

"[Multiple purpose] CR-Vs are very popular in North American and Asian markets, including Taiwan," Fujisaki said. "During the first five months of the year, Honda sold 75,000 new CR-V models in North America, up 150 percent from a year ago," he added.

Fujisaki, who previously headed a Honda unit in India between 1996 and 2001, declined to reveal the number of CR-Vs it plans to make in its first year of operations here.

Highlighting Honda's manufacturing plan for Taiwan, Fujisaki said the company recently acquired a 19,700-ping manufacturing plant from Ta Ching Motors Co (大慶汽車), located on a 57,000-ping parcel of land in Pingtung City.

"We will invest NT$3.4 billion (US$100 million) to complete the construction of the Pingtung plant and hire 500 employees there," Fujisaki said, adding that the automaker is planning to lift annual auto production capacity to 35,000 units in 2004. In the long run, the company also plans to sell Honda motorbikes as well as provide after-sales service and spare-parts supply. But initially Honda will be focusing on automobile manufacturing and sales here, he said.

"The issue of selling our larger bikes in Taiwan is complicated and it will take time and further consideration," the president said.

Taiwan recently allowed the registration of large-engine bikes. Industry watchers estimate annual demand for large bikes will reach 12,000 units initially.

To assure local customers a stable spare-parts supply, the company has established a warehouse in Yangmei, Taoyuan County. The measure apparently aims to fortify the Honda brand in Taiwan, as some of the 300,000 Honda car owners in Taiwan have expressed concerns over maintenance and after-sales services since the break-up between Honda and Sanyang.

"We will continue to provide important parts to Sanyang's distributors on the ground. But by the end of this year, we will set up 20 distribution outlets and from then we can start to service Honda customers on our own," Fujisaki said.