May 19, 2006

Honda announces plans to advance toward its “2010 Vision”

Torrance, California – Honda has announced plans to advance toward its “2010 Vision” for its North American automobile operations, in conjunction with a wider global strategy announced concurrently in Japan by Honda Motor Company Ltd.

Among the new corporate initiatives in the 2010 Vision are the construction of a new US$140 million engine plant in Alliston, Ontario in 2008; a new US$400 million auto plant in the U.S.; expansion of U.S. engine, transmission and powertrain component production in Ohio and Georgia; the U.S. and Canadian introduction of a more affordable, dedicated hybrid car in 2009; a new diesel engine within three years; and establishment of a goal to increase American Honda’s Corporate Average Fuel Economy (CAFE) by five per cent over 2005 levels by the year 2010.

Initiated in 1998, the three-part 2010 Vision calls for the expansion of Honda’s global operations through the year 2010, through “creating new value” for the customer, expanding local operations through “glocalization”, and advancing environmental and safety technologies through a “commitment for the future.”

The company’s planned new hybrid vehicle, to be produced at Honda’s Suzuka plant in Japan, will have an annual North American sales volume target of 100,000 units, and 200,000 worldwide, with a target price significantly lower than the current Civic Hybrid. The company also says that within three years, it will introduce a new four-cylinder diesel engine in Canada and the U.S. that meets the U.S. EPA’s Tier 2 BIN 5 emissions standards.

In a related report issued by the Green Car Congress, a Honda representative has said that the company will end production of the Insight hybrid in September 2006. Introduced in December 1999, the two-seater Insight was the first mass-produced hybrid sold in North America. However, sales never rose about 1,000 per month and in the last two years have usually remained below 100 per month, available only by special order. The report also says that Honda executives have denied that the subcompact Fit will be available as a hybrid.

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