Honda zooms ahead in China operations

R&D focus is high on the agenda for the joint venture between Honda Motor Co and China’s Guangzhou Automobile Group Co. The R&D focus is aimed at producing vehicles that better suit the tastes of Chinese consumers, said a report.

Honda Motor (China) Investment, which is in charge of Honda's operations in China, has announced that Guangzhou Honda Automobile Co is considering new R&D projects so it will be able to design vehicles specifically for the Chinese market on its own in the future. This in fact brings to focus Honda's plans to boost competitiveness of its products after focusing on local production operations such as annual production capacity and local parts supply procurement.

Honda has been enjoying good sales in China. The Japanese auto maker's sales in China including sales volume at another joint venture, Dongfeng Honda Automobile Co, had totaled 323,000 vehicles in 2006, going up by 26 per cent. The success rate has spurred Honda to target a boost in sales in Chinese territory to more than 400,000 vehicles in 2007. This would mean close to 25 per cent more sales compared with the figures recorded last year.

Meanwhile, other Japanese auto makers are also looking at beefing up research and development operations in China. One among them, Toyota Motor Corp, has said it's considering setting up a research and development centre in China.

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