Honda invests $111 million in Malaysia car plant to double production
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Honda invests $111 million in Malaysia car plant to double production

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Honda Malaysia Sdn. Bhd., (HMSB) held ground breaking ceremony for setting up of their second automobile production line. HMSB is company’s joint venture in Malaysia which currently has overall production capacity of 50,000 units from its first line. The second line of production, once it comes into being will add further 50,000 units taking total production to 100,000 units per annum. Investment in second line of production is expected to reach MR 350 million ($111 million or Rs 615 crores) while new production line will also offer employment to 700 new employees.

Ground breaking ceremony was attended by Y.A.B. Datuk Seri Hj. Mohd. Ali Bin Mohd. Rustam, Chief Minister of the State of Malacca and Y.B. Dato’ Seri Mustapa Mohamed, Malaysian Minister of International Trade and Industry along with top Honda executives and associates which also included Hiroshi Kobayashi – COO, Honda Asia Oceanic Region.

HMSB plant rolls out latest Honda hybrid vehicles and Jazz Hybrid will also be added to their existing lineup. The new production line is expected to be completed by early 2013 after which some vehicles from first production line will be transferred to second line. HMSB was declared as top hybrid vehicle seller in Malaysia in 2011 when sales reached 4,600 units.

The company since then has upped their target and expects to sell close to 10,000 units in the current year. Besides setting the ball rolling for a second production line, HMSB have also seen expansion in their test course, a pre delivery inspection site and most recently an automated welding facility.

For more information, read the press release below.

Auto News Release

Honda Begins Construction of Second Automobile Production Line in Malaysia

PEGOH, Malaysia, July 19, 2012 – Honda Malaysia Sdn. Bhd. (HMSB), a Honda automobile production and sales joint venture in Malaysia, today held a groundbreaking ceremony to mark the start of construction of its second automobile production line at the existing auto plant in Malacca, Malaysia. The ceremony was attended by Y.A.B. Datuk Seri Hj. Mohd. Ali Bin Mohd. Rustam, Chief Minister of the State of Malacca and Y.B. Dato’ Seri Mustapa Mohamed, Malaysian Minister of International Trade and Industry as guests of honor as well as other dignitaries, guests, and Honda executives and associates, including Hiroshi Kobayashi, chief operating officer for Honda’s regional operations in the Asia Oceania Region.

Groundbreaking Ceremony of HMSB Second Automobile Production Line (Stone Laying Ceremony)zoom
Groundbreaking Ceremony of HMSB Second Automobile Production Line (Stone Laying Ceremony)

On the second line, which is scheduled to begin operation before the end of 2013, HMSB is planning to produce mostly small-sized vehicles such as Jazz (known as Fit in Japan), and hybrid vehicles. The annual production capacity of the second line is planned to be 50,000 units, doubling HMSB’s overall production capacity from the current 50,000 units with the first line to 100,000 units. The total investment on the second line is expected to be 350 million Malaysian ringgit (approximately 8.68 billion yen*), and HMSB is planning to hire approximately 700 associates when the second line becomes operational.

Malaysia is the Honda’s largest hybrid vehicle market in Southeast Asia today, with a further increase in demand for hybrid vehicles expected. Thus, at the end of this year, HMSB will begin local production of hybrid vehicles using the existing production line. HMSB will begin production of the Jazz Hybrid, which is currently being imported from Japan, on the existing line, with production to be transferred to the second line when it becomes operational in 2013. HMSB, which became the largest hybrid vehicle seller in Malaysia in 2011 with sales of approximately 4,600 units, plans to sell approximately 10,000 units in 2012. As a leading hybrid vehicle company in Malaysia, Honda will locally produce hybrid vehicles and provide them to more customers with speed, affordability and low CO2 emissions.

Moreover, preceding the construction of the second production line, HMSB has expanded its test course and Pre-delivery Inspection (PDI) site. In addition, a new automated welding facility was introduced to the existing line timed to the local production of the all-new Civic which went on sale on July 12, 2012.

* Calculated with the exchange rate of 1 Malaysian ringgit = 24.8 yen

About Honda Malaysia Sdn. Bhd.
Established:     November 2000
Capital investment:     170 million Malaysian ringgit
Capitalization ratio:     51% Honda Motor Co., Ltd.
34% DRB-HICOM Bhd.
15% Oriental Holdings Bhd.
Representative:     Yoichiro Ueno, President
Location:     Pegoh, Malacca (approximately 120 km south of Kuala Lumpur)
Business:     Production and sales of automobiles
Products:     City, Civic, Accord, CR-V
Production Capacity:     50,000 units a year
Employment:     Approximately 1,900 associates (as of the end of June 2012)