A weakening yen and a rebounding economy have occurred just in time for Honda. The auto maker is opening its first new Japanese plant in 49 years, bucking a trend by Japanese auto makers of opening new plants in every locale but Japan.
Numerous trends, including a shrinking population, a strong yen and the 2011 tsunami spurred Japanese auto makers to open plants across the globe as a hedge against those factors. Localization of production was the dominant theme of the last couple years, with Nissan, Honda, Toyota and even smaller players like Mazda busying themselves with establishing factories in North America and the BRIC countries.
Honda’s new plant in Yorii, an economically depressed city northwest of Tokyo, will still build cars solely intended for the Japanese market, rather than for export. While Yorii will build vehicles like the Fit for domestic consumption, Honda’s new Mexican plant will build that model for North American markets.