Honda to Build Auto Plant in Celaya, Guanajuato Mexico

USA Today reported that Honda Motor Co. will build a new 800 million auto plan in Mexico to manufacturer subcompact cars. The plant will employ 3,200 (unfortunately not Americans) workers and it is scheduled to open in 2014.

At present, the Civic is the smallest car that Honda builds in North America. However, the Fit and CR-Z subcompacts sold in the U.S. have been built in Japan and imported to the U.S.. As a result of the rising value of the Yen vs. the dollar, which has been hurting the automaker's profits, the Fit and CR-Z will be built at the new Mexico plant.

It has been reported that the plant will be very large and able to pump out 200,000 cars a year. It will be located in Celaya, Guanajuato which is north of Mexico City. Many other automakers have set up shop in the same area.

As we have heard in the news, Mexico has experienced violent drug wars. Thus, it is somewhat surprising that Honda would choose to build the plant in Mexico. However, the automaker already has a car, motorcycle and auto manufacturing plant in El Salto, Mexico which is 210 miles east of the new site.

The new plant will be Honda's eighth in North America resulting in greater production capacity from the current 1.63 million units to 1.83 million per year. In 2010, over 87 percent of Honda and Acura light cars and trucks sold in the U.S. were built in North America.

Tetsuo Iwamura, president of North American Honda, was quoted in USA Today saying, "With growing demand for fuel efficient vehicles, this plan will increase Honda's ability to meet customer needs for subcompact vehicles from within North America."

Kyle Busch is the author of "Drive the Best for the Price: How to Buy a Used Automobile, Sport-Utility Vehicle, or Minivan and Save money." He welcomes your comments or car questions at his auto web site: www.cartown1.com. Follow Kyle on Facebook and Twitter.