TOKYO -- Honda Motor will start shifting production of portable outboard engines to China in April 2015 to tap expected demand growth there and minimize foreign exchange risk.
Director Yuji Shiga revealed the move at an event Monday.
Honda now manufactures all of its 2- and 5-horsepower engines in Hamamatsu, Shizuoka Prefecture. The annual output of 15,000 units will be gradually relocated to a Fujian Province generator factory. A line will be installed there for these engines, commonly used for rubber boats. This will mark Honda's first time building outboard engines overseas.
These portable types account for 30% of the outboard engines Honda now makes in Japan. But their small size and simple design mean that the domestic workload will decrease just 5%, according to the company. The plan is to maintain staffing levels by boosting sales of larger engines and other products.
Honda held a global share of just over 6% in outboard engines last year, making it the fourth-largest manufacturer and putting it behind compatriots Yamaha Motor and Suzuki Motor. With the move, the company also aims to increase its competitiveness by lowering costs.