Honda China Company Begins Construction of Guangdong Electric Vehicle Plant

A Honda E electric car is seen at the Brussels Motor Show, Belgium January 9, 2020. REUTERS/Francois Lenoir

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TOKYO, June 21 (Reuters) – Honda Motor Co Ltd (7267.T) said on Tuesday that its China joint venture with Guangzhou Automobile Group Co (601238.SS) has started construction of an electric vehicle factory in the province of Guangdong with an initial investment of 3.49 billion yuan ($522 million).

The Japanese automaker aims to start operating the plant in 2024, it said in a statement. The new factory has an annual production capacity of 120,000 units.

The dedicated electric vehicle factory will support Honda’s “core business” of electric vehicle production in China, where competition for battery-powered vehicles is intensifying, the company said.

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Honda said another electric vehicle plant in China, in a joint venture with Dongfeng Motor Group (0489.HK), is also expected to start operations in 2024.

The Japanese automaker expects its annual auto production capacity in China to increase by about 16 percent to 1.73 million units within two years.

($1 = 6.6872 yuan)

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Reporting by Sam Nussey; Editing by Tom Hogue and Muralikumar Anantharaman

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