Honda could build even more cars in North America soon, even if they’re not EVs.
As its situation stands right now, Honda is not building out its ambitious electric car plans after all. However, the Japanese automaker is still one of the largest manufacturers on Earth, and even its current factory presence in North America bears that out. According to new reports, though, the capacity Honda has to build cars here isn’t enough, so we could see another manufacturing facility — Honda’s eighth in North America — before too long.
Automotive News is one of the initial English-language outlets to bring Honda’s consideration of a new plant. The revelation hinges on recent comments from Honda CEO Toshihiro Mibe, who gave an interview to Japanese newspaper Yomiuri Shimbun. In that back-and-forth, Mibe signals a desire to significantly build on sales in North America, though the seven plants currently operating in the region are at capacity. “We need another production base,” he said. “Without a buffer, we cannot make up for lost production.”
Mibe and other Honda executives made the financially painful calculation that proceeding with the 0 Series EV lineup in the North American market would result in losses (greater than those the company already suffered scrapping the project). There is still intense demand for new cars in the region, however, so the company is changing its approach to what sort of cars it builds out in the coming years. Namely, Honda is banking on hybrids, which already comprises a substantial 40% of its global sales mix.
There’s also the prospect of boosting production lines that are cranking out as many units of popular vehicles as they can: the CR-V, the Civic, the Accord, the Pilot and the Passport. All five of those model lines are entirely built within North America — in the Passport’s case, Honda is actually exporting examples to Japan — or at least have versions built here. For example, the Civic hatchback is built in Indiana and the sedan is built in Ontario, Canada, while only the Type R is built in Japan.
In the latest Cars.com ‘American-Made Index’, Honda posted five of the top ten spots. While its EV ambitions were a costly stumble given the current climate (especially in the U.S. with no subsidies and relatively low consumer sentiment to other global markets), the move to build more in North America, for North America could stem the losses by sating customer demand for new vehicles and sidestepping tariffs that would otherwise eat into Honda’s bottom line.
Now, even with this report we are still a way off from seeing another Honda plant, if it indeed happens at all. However, it could be the best play to shore up its future prospects as global competition, especially from Chinese automakers, has “legacy” automakers and shareholders anxious to make the best long-term play. Mibe currently has the backing of shareholders, to whom he apologized at Honda’s annual shareholder meeting back in June.
