Honda Motor Company is planning to increase Mexican production of the HR-V subcompact crossover utility vehicle (CUV) by 60%, according to an Automotive News report. Honda is reported to be increasing production of the HR-V at the company's Guadalajara, Mexico, facility at the beginning of 2017. The report also states Honda plans to move production of the CR-V from Guadalajara to the company's plant in Greensburg, Indiana, United States. Honda is reported to have built about 63,000 units of the CR-V in Guadalajara, opening up significant potential for increasing HR-V production while maintaining higher-margin CR-V output in the US. The report also notes that Honda's move is also an effort for the company to better use excess capacity. Automotive News reports that Honda has the capacity to produce about 1 million units more vehicles than it currently sells per year. Honda is also looking to rely less on Japan for production, including steps such as exporting the Fit to the US from Japan to free up capacity for more HR-Vs in Mexico.
Significance: The HR-V production at Guadalajara will be in addition to the existing HR-V production at Honda's Celeya, Mexico, facility. Honda announced earlier this year the plan to move CR-V production from Guadalajara to the US. At that time, indications were that the CR-V production move would free up space of about 60,000 units for the HR-V in 2017. IHS Automotive forecasts this series of moves will increase production of the HR-V in Mexico to about 162,000 units per annum, with about 60,000 units at the El Paso plant and the remainder at Celeya. These production moves had already been announced in 2015.
