Honda to build Rs450-crore motorcycle plant in Rajasthan

Honda Motorcycle & Scooter India Pvt. Ltd. (HMSI), a wholly owned subsidiary of Japan's Honda Motor Co, said yesterday it is investing about Rs450 crore (8.9 billion) to build a second motorcycle factory in India, employing about 2,000 people.

The factory at Tapukara industrial area in north-western Rajasthan, about 90km from New Delhi, is scheduled to begin operations in the second half of 2011 with a production capacity of 600,000 vehicles a year, the Kyodo news agency reported Honda as saying.

This will enhance Honda's motorcycle production capacity in India to 2.2 million vehicles a year with its existing plant.

Additionally, to meet robust local demand, the present plant  in India will raise its annual production capacity to 1.55 million units by the end of this month and to 1.6 million units next year from the current 1.25 million units, the company said.

HMSI's first plant is located at Manesar, in Gurgaon, Haryana; it employs about 6,500 people.

The company, which began production in 2001, sold 1.09 million motorbikes last year, up 11 per cent from a year earlier and hitting a record high for the ninth year in a row, the company said.

India is the world's second-largest motorcycle market after China. Industry-wide motorcycle sales in India for 2009 reached 8.78 million units (up 19 per cent compared to 2008).