Honda investing $27m to double production

Honda Motor Co. of Japan, having a joint venture with Honda Atlas Cars (Pakistan) Ltd, has announced it will invest 2.9 billion yens ($26.85m) in the local automotive industry to double its production capacity to around 50,000 units in the current fiscal year.

Honda Motor has 51 percent stake with its joint venture company in Pakistan and is working on a full production capacity of 25,000 units.

Honda Atlas is assembling its two famous models, Honda Civic and Honda City, which are very popular locally and the demand for such models are rapidly increasing.

“Honda said the planned increase in production capacity is aimed at meeting growing auto demand in Pakistan,” said a company press release issued from Tokyo.

“Honda Motor will spend Y2.9 billion to double automobile production capacity at its joint venture in Pakistan by the end of 2006.”

“The company’s decision to make more investment in Pakistan is a result of the federal government policies,” said a dealer.

The federal government has allowed the import of three-year used car under the gift, luggage schemes on a depreciation up to 50 percent.

The government has taken the decision to allow the import of used cars only to bridge the demand and supply gap, he added. The production of the Honda Civic and City models continued to grow to 1,304 units and 1,572 units respectively in July this year compared to 602 units and 854 units of the same models in July 2004. READ MORE...