THE UK car industry appears to be booming at present with Honda UK now exporting more cars than it imports and Land Rover is to step up production of its Freelander vehicle to meet demand from new markets in the United States and Japan.
Production has started at Honda's second United Kingdom car plant, which has just been completed at Swindon in south-west England at a cost of £130m.
With two car-assembly plants plus an engine factory in the UK the Japanese vehicle maker has now become a fully fledged UK manufacturer that exports more cars than it imports.
The new plant, which is the country's first ``greenfield'' car plant to be built in the last eight years, was completed on schedule and this month's start of low-volume production marks the introduction of a work-up programme that is geared to achieve the factory's full rate of output by September when the official opening will take place.
The second production facility has been built alongside Honda's original UK car-assembly factory and an engine plant, which were opened in 1992 and 1989, respectively. About two thirds of Hondas sold in the UK are now built in the UK, where its sales have virtually quadrupled to achieve a 3% share of the market for the first time last year.
Completion of the second plant brings Honda's investment to date in its European car manufacturing operations to £1.15bn.
The new factory will increase annual production capacity at Swindon by 100,000 vehicles, taking the site total to 250,000 when combined with the 150,000 vehicle number one car plant. The company says it plans to achieve full production at both plants by 2002.
Preparations for the final recruitment stage at the Swindon complex are now under way and are expected to take the Swindon workforce up to a total of 4,000. The new plant, which has started limited production of the new Civic five-door model, uses some of the world's most advanced production systems distilled from Honda's manufacturing know-how in Japan, North America and the UK.
Minoru Harada, Honda's European President, said: “The combined capacity from the two car plants enables Swindon to become part of Honda's global supply network, exporting models to both North America and Japan as well as mainland Europe.”
This will be the first time cars have been exported to Japan and the United States from Honda's manufacturing base in England. Honda of the UK Manufacturing (HUM) was established in 1985 at Swindon.
Engine production at Swindon started in July 1989 and this plant has built most of the petrol engines installed in Swindon-built cars as well as exporting engines to Honda's car plant in Turkey. Car production began in October 1992 with the introduction of the European version of the fifth-generation Accord.
Cumulative production at the Swindon site now exceeds 700,000 cars, made up of about 400,000 Civics and 300,000 Accords. The capacity of the engine factory is sufficient to meet the combined needs of both car plants which will start to export the new Civil three-door model to Japanese and US markets later this year followed by shipments of the next generation CR-V compact sport utility vehicle to the US in early 2002.
For Land Rover, the planned increase at the firm's production plant at Solihull in the English Midlands is from 1,750 to 1,950 Freelanders a week and will require an extra 150 people to be added to the 8,317 staff working on the assembly line.
A spokesman said: “The increase is required to meet demand in North America where Freelander sales commence at the end of this year. It follows on from the vehicle's successful introduction in Japan, where Land Rover sales volumes have increased three-fold compared with the same period last year following the launch of the Freelander V6. The Freelander is already the best-selling four-wheel-drive vehicle in the UK and Europe.”
Commenting on the production boost, Land Rover chairman and chief executive officer Bob Dover said: “International expansion is the key to Land Rover's expected growth. Introducing the Freelander into the North American market is an important step in our expansion plans. The US is the world's biggest 4x4 market and we are hoping to increase greatly Land Rover's presence there.”
The Freelander is the newest member of the Land Rover stable and was introduced to offer a combination of car-like comfort with the rugged off-road capability of traditional Land Rover models such as the Discovery.
Freelander claims to have the broadest span of capability on and off road in its class. The company has just reported record sales in the UK, with more than 25,000 vehicles sold in the first six months of this year and which is 15% up on the same period of last year.
Land Rover now has nearly 2% of the total UK car market and 38% of the 4x4 vehicle market. Leading the field is the Freelander, which accounted for 13,853 of the 25,000 sales.