Honda to cut ICE car production capacity in China: report

CARMAKER Honda Motor is planning to cut down the production capacity of internal combustion engine cars by one-third, Nikkei reported on Thursday (Jul 25), as increased competition from lower-priced local manufacturers has weighed on sales of Japanese automakers.

Honda will close three of its seven production lines in China, the world’s largest auto market, reducing its annual ICE vehicle capacity to one million from 1.5 million, the report said.

Chinese car makers have ramped up production, flooding the world’s largest auto market and other markets in South-east Asia with low-priced vehicles, intensifying competition in a historically strong market for Japanese car markers.

Honda Motor did not immediately respond to a Reuters request for comment.

Honda began manufacturing cars in the world’s second-largest economy in 1999 and a move to reduce production would be the biggest by any Japanese automaker in the past few years.

The Japanese business daily said that Honda Motor was in talks with its joint venture partners GAC Group and Dongfeng Motor Group about the production cut and is expected to make an announcement later this year. REUTERS