Honda could be forced to spend more than $630 million to repair its flood-damaged vehicle production factory in Thailand.
Honda’s Ayutthaya plant in central Thailand was submerged by floodwaters last October in what was the Southeast Asian country’s worst natural disaster in more than 50 years.
A Honda executive told Japan’s Nikkei newspaper the car maker has begun replacing equipment at the factory and aimed to return to production in April.
The executive said the cost and effort of refurbishing the plant was almost equal to building a brand new plant from scratch.
Before the floods, the plant was producing cars at a rate of 240,000 per year, accounting for approximately 4.5 per cent of Honda’s total global production. The majority of Honda Australia’s vehicles – including the Accord, City, Civic sedan, CR-V and Jazz – were all being produced at Ayutthaya before the plant was forced to close.
Last week, Honda Australia announced the introduction of the Japanese-built Jazz Vibe to cover low supply of its Thai-sourced Jazz. The Vibe is more expensive than the conventional Jazz but comes with more standard equipment.
The Civic sedan is also being imported from Japan while the Thailand plant is out of action.
Honda Australia’s Lindsay Smalley said stock of the Accord and City from Thailand was also now tight.
“We have ample supply of Accord Euro, Odyssey, Insight and CR-Z,” he said. “The Jazz Vibe will be in Honda showrooms in February and the ninth-generation Civic is due in March.”
Smalley confirmed the new versions of the Civic Si hatch and the CR-V were still on track to go on sale locally in the second half of 2012.