COLUMBUS, Ohio — Honda Motor Co., the first Japanese auto maker to build cars in the United States, said Thursday that it would spend $561 million to expand its operations.
Honda officials said the expansion would include $380 million for a new auto assembly plant at Marysville, Ohio, and added research and development facilities in Marysville and Torrance, Calif.
Tadashi Kume, president of the Tokyo-based company, said the moves were designed to establish Honda as a self-reliant motor vehicle company in the United States.
"It is not enough that our U.S. operations are competitive only in the United States. Our goal is that our United States operations attain capabilities that compare to our operations in Japan," Kume told a news conference.
"That is why we are announcing expansions of our research and development, our production engineering, our sourcing of U.S. parts, our automobile and engine manufacturing and our export sales," he said.
Honda officials said the company would begin building in February a $380-million assembly plant near its existing car-motorcycle plant at Marysville, northwest of Columbus. The plant would employ 1,800 workers and be capable of producing 150,000 cars annually. The first cars to be produced there will be four-door Civics.
Published reports had predicted that the luxury Acura model would be produced at the new plant, but a company spokesman said there were no plans to manufacture those cars at Marysville.
Production is to begin by August, 1989. The plant will be built on part of the 7,500-acre Transportation Research Center of Ohio, which Honda will buy from the state for $31 million.
The car maker also said it planned that by 1991, 75% of the parts in the cars produced at Marysville would be made in the United States, compared to 60% for 1988 models.
The company planned a $150-million expansion of its engine plant at Anna, in western Ohio, increasing production to 500,000 engines a year, and adding 500 jobs.
Officials said they plan to expand their principal U.S. research and development facilities, now based in Torrance, Calif., and Marysville, to 500 by 1991 from the current staff of 180 workers. Employment at the U.S. branch of Honda Engineering, located at Marysville, also will increase, to 200 by 1991 from 50 workers.
Honda now employs 4,000 people at Marysville who produce 320,000 cars and 60,000 motorcycles each year. Employment at Anna will reach 1,500 with the proposed expansion.
Through the expansion and new plant, the officials said they hope to be able to export 70,000 cars annually from Ohio to Japan and other countries by 1991. That compares to 3,000 cars planned for export to Japan in 1988, along with 500 motorcycles.
Big Challenge for Honda
"What we are trying to establish in the United States is a big challenge for Honda," Tetsuo Chino, president of Honda North America, said.
Honda officials said neither the U.S. trade deficit nor the inability of the United Auto Workers to organize employees at Honda plants played a role in the decision to expand in Ohio.
"Our decision has nothing to do with trade frictions between the two countries," Kume said through a translator.
Kume said the development would be financed internally by Honda.