DETROIT -- Honda Motor Co. has chosen a 1,700-acre site in southeast Indiana to build its sixth auto assembly plant in North America.
Construction on the $550 million project, near Greensburg, begins this fall, Honda officials said Wednesday. Production is expected to start in the fall of 2008, with a maximum annual capacity of 200,000 vehicles.
Indiana beat out Ohio and several other states for the plant. The automaker disclosed in May that it planned to build an assembly plant in the Midwest as part of a major expansion of its manufacturing capacity in North America.
The plant is expected to employ about 2,000 people initially, Honda officials said.
The Indiana site is about 100 miles from Hondas engine plant in Anna, Ohio, and about 50 miles southeast of Indianapolis. Honda officials said the Anna plant will supply four-cylinder engines to the Greensburg plant.
Koichi Kondo, CEO of American Honda Motor Co., said during a media conference call that Honda decided to locate the plant in the Midwest to stay close to its existing supplier base and manufacturing network.
Additional factors in selecting the Greensburg site were excellent transportation systems, the necessary infrastructure to support industry, the available, well educated work force and the friendly communities, Kondo said.
Honda would not elaborate on why two Ohio sites were rejected for the Indiana site. Honda already builds Accord and Acura models in Marysville, Ohio and Civic and Element models in East Liberty, Ohio.
We determined the Midwest really is no longer the Rust Belt. Its rather vibrant now, said Larry Jutte, senior vice president and general manager of Honda of America Manufacturing Inc. Our supply base thats spread across the Midwest is very key to our success. The density of our supply base was such that allowed us to choose this location.
With this new plant, Honda will increase annual U.S. production capacity from 1.4 million to 1.6 million units.
The new plant, like all new Honda production facilities, will be designed and built with the greatest flexibility possible, Jutte said. We have the flexibility with this site to do whats ever necessary to meet customer demand, Jutte said.
Honda would not divulge how many different models it expects to build in the new plant.
One of the critical things that weve identified is the shortage of four cylinder engines, and our ability to have four-cylinder engine products, said Richard Colliver, executive vice president for Honda and Acura sales at American Honda Motor Co.
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