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NEWS UPDATES 30 August 2009

Honda to ramp up new minivan output in Indonesia

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Japan-based carmaker PT Honda Prospect Motor (HPM) plans to expand its local production capacity from 50,000 units annually to 60,000 to fulfil its plans to export its newly released Honda Freed, the Jakarta Post reported.

HPM marketing and after sales service director Jonfis Fandy said Friday this expansion in capacity was urgent as demand for the Honda Freed had so far reached 5,000 units by the end of this month, forcing the company to cut production of the Honda Jazz and the CR-V.

As a result, he said, consumers had to wait for three months to get their Honda Freeds. Sales of Honda Freeds are expected to exceed 4,000 units this month, he said.

However this was still 20 percent under current monthly demand, hence the delays in meeting customer’s orders. “We increased production capacity of the Freed by 50 percent to 1,500 units a month in July by sacrificing the production levels of the CR-V and Jazz,” Jonfis said.

“So, we have decreased the production levels of these two models on purpose. It’s not true that Jazz and CR-V sales have weakened.”

HPM’s parent company Honda Motor Corp. has appointed a local company, which already has an assembly plant in Karawang, West Java, to become the production hub for the expanding production line for the Honda Freed, which was only launched in June, in the Southeast Asian region, but is already seen as a marketing success.

Jonfis said HPM would start to export a total of 30 Honda Freeds to Brunei Darussalam and Singapore next month, while it was still waiting for another call from Thailand that it should step up exports destined for that market.

“Exports (of Honda Freed) are expected to start next year,” he said. Industry Ministry director for land and military transportation industries Panggah Susanto confirmed HPM’s plan to export the Honda Freed model from its Indonesian assembly line.

The Freed was launched in Japan in May 2008, and in March 2009 in Indonesia. It was nominated the Best Value Minivan in Japan Car of the Year 2008-2009. Its initial success may be attributed to good design, anticipating customer needs and improved consumer confidence.

Honda chose the minivan’s name to stand for “free + do” (Freed), meaning passengers can move about freely in the cabin and do whatever they please, especially children, who can play when the rear seat is folded down. This type of consideration is critical to the success of the vehicle.


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