Honda plans new $110 mln two-wheeler plant in India

Honda plans new $110 mln two-wheeler plant in India

Mumbai: Honda Motorcyle and Scooter India (HMSI) will invest Rs5 billion ($110 million) to build a new plant in the Indian state of Rajasthan, a company executive said.

The new plant will have annual capacity of 600,000 scooters and motorcycles that will take HMSI’s total capacity to 2.2 million, said Naresh Kumar Rattan, general manager of HMSI and operating head of sales and marketing.

HMSI is a wholly owned subsidiary of Japanese automaker Honda Motor Co.

HMSI’s current facility in Haryana state has peak capacity of 1.6 million scooters and motorcyles, and is close to operating at full capacity.

HMSI will also launch one new motorcycle in the Indian market in 2011. The CBR 250R - will be introduced in April, Rattan told reporters on the sidelines of an event late on Wednesday.

Media reports have said India’s Hero group and Honda Motor would soon terminate their joint venture Hero Honda Motors , the Indian market leader in motorcycles, through the sale of Honda’s 26% stake to its Indian partner.