New Delhi: Honda Motor Co., the world's biggest motorcycle maker, said it will invest about 8.9 billion yen (Dh364 million) to build a second motorcycle plant in India as demand there exceeds current capacity.
The plant will start production in the second half of 2011 and have the capacity to make 600,000 motorcycles a year, Tokyo-based Honda said in a release on its website.
India, the world's fastest-growing major economy after China, may expand 8.2 per cent in the 12 months from April 1, from an estimated 7.2 per cent this year, India's finance ministry forecast on February 25.
Hero Honda Motors Ltd. may also build a fourth motorcycle factory, Managing Director Pawan Kant Munjal said on March 4.
Honda is expanding production capacity of its existing plant by 24 per cent to 1.55 million units by the end of this month and will raise it to 1.6 million units next year, the company said.
Sales at Honda Motorcycle & Scooter India Ltd., Honda's motorcycle unit in India, rose 11 per cent last year to 1.1 million units, the company said.
Honda shares rose 0.3 per cent to 3,240 yen in Tokyo yesterday.
