Honda’s next major American factory appears increasingly likely to land in a familiar place. The Japanese automaker is believed to be closing in on plans for a new assembly plant in Ohio, where it has been building cars for more than four decades.
This time, hybrids would take center stage. Nikkei reports that Honda is in the final stages of preparations for a new Ohio factory dedicated to hybrid vehicles, potentially representing an investment of up to $2.5 billion.
If everything goes according to plan, production could begin in 2030. The additional capacity would arrive as Honda devotes more of its near-term attention to hybrids after a major rethink of its battery-electric vehicle strategy.
It’s important to note that Honda hasn’t officially given the project the green light. The company says no decision has been made regarding a new U.S. plant, meaning Ohio may be the reported frontrunner, but the deal isn’t done yet.
Honda Could Spend Up To $2.5 Billion
According to Nikkei, Honda is considering an investment of between 300 billion and 400 billion yen, currently equivalent to roughly $1.9 billion to $2.5 billion. Negotiations are still underway, including discussions surrounding government incentives.
The new facility could expand Honda’s North American production capacity by around 10%, taking annual capacity beyond two million vehicles. Reports suggest Honda’s existing North American assembly operations are already running at around 90% capacity, leaving limited room for the company’s planned expansion.
Ohio would be a natural choice. Honda began U.S. automobile production at its Marysville plant in 1982 and has since established an extensive manufacturing presence across the state.
Hybrids Are Becoming Much More Important To Honda
The proposed factory reflects Honda’s changing electrification strategy. Earlier this year, the company canceled three planned EVs that were expected to be manufactured in the United States as it reassessed spending and future demand.
Hybrids, meanwhile, are assuming a much larger role. Honda plans to introduce 15 next-generation hybrid models globally through 2030, with North America expected to receive many of them.
The automaker is also developing its next-generation hybrid technology with an emphasis on lower costs and improved efficiency. Honda has previously said it is targeting a reduction of more than 30% in the cost of its next-generation hybrid systems compared with its existing technology.
What Could Honda Build There?
Exactly which models would roll out of the proposed Ohio factory hasn’t been officially announced. Automotive News reports that future large Honda and Acura hybrid SUVs are among the possibilities, although those product plans are subject to change.
Honda has already previewed some of its future thinking through hybrid prototypes, including a sedan and an Acura SUV. More locally produced hybrid models would also give the automaker greater control over its North American supply chain.
A final agreement still needs to happen before construction crews can start moving dirt. If the reports prove accurate, however, Ohio could soon become even more important to Honda’s American manufacturing operation — this time with hybrids leading the expansion.