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Honda Announces Mid-term Business Strategy for China

Honda Motor (China) Investment Co., Ltd. has announced its mid-term business strategy for China.

- Introduction of more than 10 new and full-model-change Honda models between 2013 and 2015.
- Double Honda unit sales by 2015 (compared to 2011)
- Renewal of all Honda and Acura engines by the end of 2015.
- Honda will strive to realise the highest fuel economy in each vehicle category in the Chinese automobile market.
- Introduction of a new hybrid system for mid- to large-sized vehicles as well as a plug-in hybrid system.
- Significant enhancement of R&D capacity in China.
- Strengthen production in China. New lines at both Dongfeng (2012) and Guangqi (2014) plants. Outline of mid-term strategy

Strengthening Honda brand product

・For the Honda brand, introduction of more than 10 new and full-model-change models is scheduled during the 3-year period from 2013 to 2015. By enhancing its product lineup, we will steadily increase our sales striving to double its 2011 unit sales in 2015.

・Honda will more focus on the needs of customers in China and introduce a number of products that will bring joys to customers.

・All Honda vehicles sold in China will shift to new engines that apply Earth Dreams Technology, Honda's innovative next-generation technologies. The engines of all Honda brand vehicles will be renewed by the end of 2015. In this way, Honda will strive to realize the highest fuel economy in each vehicle category in the Chinese automobile market.

・As for hybrid models, within this year, Honda will introduce three models to the Chinese market. All three models, the CR-Z, the Insight and the Fit Hybrid, are equipped with Honda's original IMA (Integrated Motor Assist) lightweight and compact hybrid system.

・Honda is currently preparing for local production of hybrid models in China. Through local procurement of key components such as batteries and motors, Honda will strive to reduce costs in order to popularize hybrid vehicles in China.

・As the next step following the popularization of the IMA hybrid system, Honda will introduce to the Chinese market a new hybrid system most appropriate for mid- to large-sized vehicles as well as a plug-in hybrid system.

・As for electric vehicles, Honda began demonstration testing in Guangzhou last year. Based on the results of this testing, Honda is preparing to begin local production at Guangqi Honda sometime toward the end of this year.

Strengthening Acura brand products

・The new NSX will be introduced to the Chinese market which represents the Acura brand. The new NSX will apply the Sport Hybrid SH-AWD(R) (Super Handling All Wheel Drive) hybrid system which combines superior driving and environmental performance.

・The Acura brand will strengthen its product lineup in China this year with introduction of the ILX, a small-sized sedan, and the RDX, a small-sized SUV, as well as the scheduled introduction next year of the RLX luxury sedan.

・Moreover, starting in stages next year, the Acura brand is planning to introduce models equipped with new, relatively small-sized engines, for which demand is high in China.

・The powertrains of all Acura models also will be renewed by the end of 2015 to bring the latest advanced technologies to customers in China.

Strengthening R&D

・Honda is considering the establishment of a Honda design studio in China. The R&D teams of the joint venture companies, the development team of Honda China and Honda research centers in Japan will work together to significantly enhance Honda's R&D capacity in China. Through this initiative, Honda will further strengthen its system and capability to enable its Chinese associates to locally develop products that exceed the expectations of customers in China.

・Along with the further localization of our development, Honda also will pursue further localization in the sourcing of parts and components. To increase cost competitiveness, Honda will further increase the number of new local suppliers.

Expansion of production capacity

・In July of this year, the second plant of Dongfeng Honda will begin production. At this new plant, Honda will employ the world's latest production technologies to achieve excellent environmental performance and to make it an advanced plant with a human-friendly workplace for associates.

・Guangqi Honda is also making progress with a plan to build its third line and is aiming to begin production on this new line in 2014.

Motorsports

・Honda will initiate the promotion of racing activities and expand the awareness of motorsports activities which are currently hasn't yet gained great popularity in China. Honda will participate in the FIA World Touring Car Championship (WTCC) starting this year. In addition, Honda will race on a spot participation basis in the China Touring Car Championship (CTCC), starting this year.

・For this year's China Grand Prix in November, Honda will participate both in WTCC and CTCC.

Overview of Display for the Beijing International Automotive Exhibition

At the Honda booth, two concept models that focus on Chinese customers will make their world premiere. In addition, hybrid models (CR-Z, Insight, Fit Hybrid) which will be introduced to the market this year, will be on display.

At the Acura booth, in addition to the all-new NSX Concept, the ILX and the RDX which will be introduced to the Chinese market this year, will be on display.

The Honda booth and Acura booth will each host a press conference at 10:00am (11:00am Japan time) and 10:30am (11:30am Japan time), respectively, on April 23, 2012.