Honda Malaysia aims to be top hybrid hub in Asia-Oceania

ALOR GAJAH (Jan 17, 2014): Honda Malaysia Sdn Bhd, which is targeting sales of 76,000 units for 2014, aims to be the number one hybrid hub in Asia-Oceania by 2016, said its managing director and CEO Yoichiro Ueno.
Yesterday the company launched the RM382 million second production line at its Pegoh plant in Malacca that will assemble small models and hybrid vehicles.
The second line is Honda’s as well as the country’s first hybrid facility, which will produce hybrid cars for the regional market, which includes Southeast Asia, Australia and New Zealand.
The opening of the second line at its Pegoh plant comes some 11 years after the first line was opened in January 2003, and just days before the government is set to announce the National Automotive Policy (NAP) which is expected to focus on the development of the energy efficient vehicle (EEV) industry in the country.
Ueno when questioned on the upcoming policy release said: “We understand that the completely-built-up (CBU) hybrid incentives will finish. However, we see that the Malaysian market may take a little more time for hybrid vehicles to be popular. So, we hope the government will continue some sort of incentives for EEV or hybrid vehicles.”
He said EEVs are becoming popular now compared with two to three years ago.”The awareness is high and people are more conscious about saving petrol,” added Ueno.
Sales of Honda hybrid vehicles stood at 22,000 units as at December 2013.
The second line, the launch of which was officiated by International Trade and Industry Minister Datuk Seri Mustapa Mohamed, will also see Honda double its production capacity to 100,000 units, producing some 400 units a day, as opposed to 200 units now. This Ueno said is in line with its mid-term goal of achieving sales of 100,000 units by 2016.
“With that volume (100,000 units by 2016), we might be able to achieve the number one position, depending on other competitors,” Ueno told reporters after the opening ceremony of the second line and media plant tour here yesterday.
Currently Honda Malaysia assembles the City, Civic, CR-V, Accord and both the Jazz Petrol and Hybrid variants at its Pegoh plant.
Ueno said Honda looks to further develop its local production in Malaysia by developing skilled local capabilities and implementing advanced manufacturing technologies here, which will help it achieve the long term growth of the Honda brand. The expanded plant is expected to employ 700 new associates.
“We have set our mid-term plan to make additional investments of RM1 billion in three years from 2012, to the manufacturing and sales network.”
Honda Malaysia’s sales target of 76,000 units for 2014 is about 47% higher than the 51,546 units sold in 2013. It is targeting sales of 78,000 units in the next financial year from April 1, 2014 to March 31, 2015.
Honda has enhanced its overall operations in Malaysia in the past couple of years with a new parts warehouse, new test track facility, new per-delivery inspection centre and recently, changing its logistic to rail in order to be more efficient.
It is also targeting to enhance the localisation of the component parts to over 70% in the near future from 30% to 40% currently, besides wanting to have 90 dealers by the end of 2015.