Honda will close its Ayutthaya plant in Thailand by 2025, as it faces increasing competition from Chinese brands and rising demand for electric vehicles.
A spokesperson for Honda stated that this move will require the company to reorganize its production activities at its remaining plant in Prachinburi, the only one left in Thailand. The Ayutthaya facility will be repurposed for the production of automotive parts.
Honda will produce its new e:N1 electric vehicle at its remaining plant in Prachinburi, Thailand (Image source: Paultan).
The challenging market conditions have led to Honda's production volume in Thailand falling below 150,000 units per year over the past four years, down from 228,000 units in 2019. Meanwhile, annual sales have remained below 100,000 units for the past four years.
Another Honda spokesperson mentioned that additional investments in the Prachinburi plant will facilitate the prioritization of transitioning to hybrid vehicles. Honda has already begun production of electric vehicles there, with the e:N1 model also in the pipeline.
Japanese automakers like Honda and Nissan have been heavily impacted by intense competition in China, and now face the risk of losing customers outside of the Chinese market, including in the ASEAN region.
Chinese automakers are expanding their export markets and establishing overseas plants. One of China's largest automakers, BYD, recently opened an electric vehicle plant in Rayong, Thailand, with a production capacity of 150,000 units per year.
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