Honda Plans Alabama Job One by Year’s End

Honda Motor Co. Ltd.’s forthcoming manufacturing plant in Alabama is on schedule for Job One before year’s end, says Koki Hirashima, president of Honda of America Manufacturing Inc.

Equipment in the plant is 70% installed, and Honda has begun hiring workers, he says.

Honda plans to fill its 120,000-unit vehicle capacity by building its popular Odyssey minivan -- at least initially. Capacity here is flexible and the automaker likely will bring another product to the plant in the future, the specifics of which have yet to be decided, Mr. Hirashima says.

The plant, the first to open after the automaker’s implementation of its ultra-flexible Global New Manufacturing System, differs from Honda’s other North American production facilities in that it also will build the Odyssey’s V-6 engines on site.

The new plant may only partially relieve Honda’s taut production capacity; thanks to the automaker’s efficient manufacturing practices, it has no excess capacity whatsoever -- a problem other manufacturers would love to have.

Honda views capacity on a global basis, says Mr. Hirashima, adding that although the automaker is relatively small compared to other automakers, Honda feels its size can “work to its advantage if used effectively. The goal is to view our entire global manufacturing operations as one entity,” he says.

Honda fully utilizes its 2.7 million-unit global capacity, the bulk of which is destined for North America. Unlike other Japanese automakers, North America is Honda’s primary market, comprising about 50% of its sales.

Arguably the least Japan-oriented of the Japanese automakers, Honda also is letting its North American production facilities take the lead on global product launches. For the launch of the ’01 Civic, East Liberty, OH, not Japan, served as the “mother plant,” a trend Mr. Hirashima says will continue.

Honda under its new manufacturing system now for the first time will build vehicles outside of Japan for export to the home market. Next year’s new CR-V sport/utility vehicle, for example, will now be built in Honda’s U.K. plant as well as in Japan, and exported back to Japan and the U.S. The sporty Civic SI hatchback will be built alongside the CR-V at the U.K. plant for export to Honda’s primary markets.

It’s this improved system that Mr. Hirashima says allowed Honda to smoothly transition production of the ’02 Acura RSX from its Suzuka facility to its Sayama plant only five months before launch – a feat he acknowledges is especially remarkable in Japan’s traditional manufacturing culture.