Honda Investing $500m in Micro Car Production

Justin Berkowitz
by Justin Berkowitz
honda investing 500m in micro car production

Honda's stepping-up their investment in their smallest Japanese models. Although Kei cars are virtually unknown to Americans, they account for a huge segment of the Japanese car market. High gasoline costs, motoring taxes and strange parking permit requirements have lead to the creation a car category whose engine displacement is capped at 0.66 liters (just slightly more than a 20oz bottle of soda). Honda has announced that they're spending ¥50 billion ($500m) to streamline production of these little buggers (production will be "almost the same as the current capacity"). A few years ago, Honda acquired a company to build Kei cars for them. So this huge investment is aimed at integrating that company into Honda's structure. Efficiency is the way to go when you're talking about cars with 50 horsepower.

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  • Andy D Andy D on Mar 17, 2008

    A micro car does make more sense to me than an electric. 52hp/ 1800 lbs is a better power to weight ratio than 36hp/ 2000lbs my father's 58 bug had. He commuted 70+ miles a day in it for yrs.

  • Eh_political Eh_political on Mar 17, 2008

    thank goodness GM divested itself of a controlling interest in Suzuki. now they can concentrate on making kei pickups and suvs. small, urban versions of their current products weighing 4000 lbs (give or take) and averaging 20 mpg in the real world. (give or take). crisis averted.

  • Bancho Bancho on Mar 17, 2008

    eh_political : I know what you mean. Just imagine what would have happened had they imported the JDM Suzuki Swift and used it in lieu of the Aveo or as a sporty complement to the Aveo. I hear the JDM Swift is a sweet little car and I'm disappointed that we can't get them here. Anyway, it's best GM got out of that situation while they could because they may have actually wound up with a desirable small car. The horror! :D

  • Jthorner Jthorner on Mar 18, 2008

    Methodical. Persistent. Decisive. Hmmm, sounds like Honda, eh? As a US Citizen I wish I could same to the same for GM, Ford and Chrysler, but a whole lot of different descriptive words come to mind for the 2.8.