Honda Forecasts Sales of 12.5 Million Cycles in 2006

Takeo Fukui, President and Chief Executive Officer of Japan’s Honda Motor Co. Ltd., estimates the company’s worldwide sales in 2005 will include 12.5 million motorcycles, 3.35 million automobiles and 5.60 million power products.
Fukui, offering a year-end business summary during a presentation in Tokyo on December 20, said he expects motorcycle sales to climb 16% from sales in 2004, auto sales to climb 5%, and power product sales to gain 6%.
Fukui’s presentation summarized Honda’s financial achievements during the past twelve months as well as strategic plans for 2006. Regarding powersports product, he outlined upcoming initiatives in six main regions – North America, Europe, Asia, China, South America and Japan.

For North America, Fukui said only “Honda will lead the industry in adopting the most advanced features for motorcycle products.”

For Europe, Honda will remodel the CBF1000, an Italy-made four-cylinder touring sports model, as well as Deauville, a Spain-made 680cc V-twin touring model, which were both displayed at the Tokyo Motor Show. “Along with Japan-made new models including the CBR1000RR and Silverwing 400, the new product line-up will meet the demands of our customers in Europe,” he said.

For Asia, Fukui said three new plants will become operational in 2006. A plant in the Philippines will have a maximum output capacity of 200,000 units; a plant in Pakistan will have a capacity of 150,000 units; and a plant in India will be able to produce in excess of 450,000 units annually.
Honda’s overall annual motorcycle production capacity in Asia Oceania is estimated to reach 11 million units in 2006 and 14 million units in 2007.
Honda will introduce a new commuter model equipped with a compact water-cooled engine designed especially for Asian markets and an automatic transmission, as well as a high fuel-efficiency model equipped with a super-low-friction engine. Moreover, Honda plans to introduce a total of 10 fuel injection equipped models in the Asia Oceania region.

In China, a new plant for Wuyang-Honda, currently in the process of being relocated, will become operational at the new site in spring 2006. Annual production capacity will be expanded from a current 600,000 units to 800,000 units.

Honda will begin local motorcycle production in Argentina in mid-2006, and Fukui said business in Brazil grew well, with cumulative production at the Honda plant in Brazil reaching 8 million units at the end of November.

A new Forza will be introduced to the market in 2006 with improved styling and a Honda S-Matic transmission that is advanced from the current 6-speed to 7-speed. In addition, Fukui said the DN-01, a HFT-equipped automatic sports cruiser introduced at the Tokyo Motor Show, will be further advanced for introduction to the market “in the near future.”

In October, Honda reported a record profit for the fiscal half-year – up 1% from a year ago – on the back of strong sales worldwide, but especially in North America.
The company has revised its full year forecast upward to 490 billion yen ($4.2 billion) profit, up from its earlier forecast for 470 billion yen ($4 billion) profit, which would be a record high for Honda for the fifth straight year.
Takeo Fukui joined Honda Motor Co. Ltd. in 1969. In 1994, Fukui moved to the U.S. as Executive Vice President of HAM in Ohio, a major production base that includes four different plants. Fukui served as President of HAM from 1996 to 1998, overseeing the company as its production volume expanded significantly – including the first Acura model built in North America – to meet increasing customer demand in the U.S. He became the sixth president of Honda Motor Co. Ltd. in 2003.

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