We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Honda's $3B Ohio Plant to Boost US Vehicle Production Capacity
Read MoreHide Full Article
Key Takeaways
Honda plans a $3 billion Ohio assembly plant with annual capacity of 240,000 vehicles starting in 2029.
The new facility will address capacity constraints and raise U.S. production capacity to 1.3 million vehicles.
Honda is upgrading Alabama, Ohio and Georgia facilities to expand next-gen hybrid powertrain production.
Honda (HMC - Free Report) is strengthening its U.S. manufacturing footprint with a planned $3 billion investment in a new vehicle assembly plant in Central Ohio. The facility is expected to begin production in 2029, with an annual capacity of 240,000 vehicles. The investment reflects Honda's efforts to expand domestic production, address customer demand and strengthen its capabilities across gasoline-powered, hybrid and electric vehicles.
Honda's Ohio Plant to Expand U.S. Production Capacity
The new facility will be located between Honda's existing East Liberty and Marysville assembly plants in Ohio. It is expected to create more than 2,000 jobs and increase Honda's U.S. light-duty vehicle production capacity to approximately 1.3 million units annually. The plant will have the flexibility to manufacture internal combustion engine vehicles, hybrids and fully electric models.
Per CNBC, the company is currently unable to fully meet customer demand because of capacity constraints. The additional facility should help Honda address this shortfall and accommodate future production requirements.
HMC Expands Hybrid Manufacturing Capabilities
Alongside the Ohio investment, Honda is upgrading its existing manufacturing facilities to support hybrid production. Its Lincoln, AL, plant will expand engine production to include a new V-6 hybrid powertrain and improve manufacturing flexibility.
Honda's Anna Engine Plant in Ohio is being retooled to produce a next-generation Atkinson-cycle four-cylinder engine for compact and midsize vehicles. Its transmission facility in Russells Point, OH, will also add a second production line for next-generation hybrid systems. The facility will lead production of hybrid systems for larger vehicles, with manufacturing planned at Honda's Georgia transmission plant.
Honda's investment comes as automakers seek to strengthen domestic production amid tariffs and higher logistics costs. The company acknowledged that tariffs are affecting its business, although management emphasized that meeting U.S. customer demand remains the primary motivation.
Honda's latest announcement follows its decision to indefinitely suspend an earlier $11 billion Canadian EV investment plan and cancel three planned U.S. EVs earlier this year, per CNBC.
The new plant and upgrades to existing facilities should strengthen Honda's U.S. production capabilities and provide greater flexibility to respond to changing powertrain demand. However, the investment's eventual returns will depend on capacity utilization and vehicle demand.
Price Performance of HMC
Shares of HMC have gained 20.7% over the past year compared with the industry’s 15.7% fall.
The Zacks Consensus Estimate for SMP's current-year earnings is pegged at $4.3 per share, indicating a 7% year-over-year increase. Its earnings beat the Zacks Consensus Estimate in three of the trailing four quarters and missed once, with the average earnings surprise being 11.5%.
The Zacks Consensus Estimate for EVGO's current-year loss is pegged at 53 cents per share, indicating a 71% year-over-year decrease. Its earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, with the average surprise being 40.7%.
The Zacks Consensus Estimate for LCID's current-year loss is pegged at $12.15 per share, indicating a 0.5% year-over-year decrease. Its earnings missed the Zacks Consensus Estimate in each of the trailing four quarters, with the average negative surprise being 30.3%.
View the Zacks #1 Rank List
Image: Bigstock
Honda's $3B Ohio Plant to Boost US Vehicle Production Capacity
Key Takeaways
Honda (HMC - Free Report) is strengthening its U.S. manufacturing footprint with a planned $3 billion investment in a new vehicle assembly plant in Central Ohio. The facility is expected to begin production in 2029, with an annual capacity of 240,000 vehicles. The investment reflects Honda's efforts to expand domestic production, address customer demand and strengthen its capabilities across gasoline-powered, hybrid and electric vehicles.
Honda's Ohio Plant to Expand U.S. Production Capacity
The new facility will be located between Honda's existing East Liberty and Marysville assembly plants in Ohio. It is expected to create more than 2,000 jobs and increase Honda's U.S. light-duty vehicle production capacity to approximately 1.3 million units annually. The plant will have the flexibility to manufacture internal combustion engine vehicles, hybrids and fully electric models.
Per CNBC, the company is currently unable to fully meet customer demand because of capacity constraints. The additional facility should help Honda address this shortfall and accommodate future production requirements.
HMC Expands Hybrid Manufacturing Capabilities
Alongside the Ohio investment, Honda is upgrading its existing manufacturing facilities to support hybrid production. Its Lincoln, AL, plant will expand engine production to include a new V-6 hybrid powertrain and improve manufacturing flexibility.
Honda's Anna Engine Plant in Ohio is being retooled to produce a next-generation Atkinson-cycle four-cylinder engine for compact and midsize vehicles. Its transmission facility in Russells Point, OH, will also add a second production line for next-generation hybrid systems. The facility will lead production of hybrid systems for larger vehicles, with manufacturing planned at Honda's Georgia transmission plant.
Honda's investment comes as automakers seek to strengthen domestic production amid tariffs and higher logistics costs. The company acknowledged that tariffs are affecting its business, although management emphasized that meeting U.S. customer demand remains the primary motivation.
Honda's latest announcement follows its decision to indefinitely suspend an earlier $11 billion Canadian EV investment plan and cancel three planned U.S. EVs earlier this year, per CNBC.
The new plant and upgrades to existing facilities should strengthen Honda's U.S. production capabilities and provide greater flexibility to respond to changing powertrain demand. However, the investment's eventual returns will depend on capacity utilization and vehicle demand.
Price Performance of HMC
Shares of HMC have gained 20.7% over the past year compared with the industry’s 15.7% fall.
HMC’s Zacks Rank & Other Key Picks
HMC currently carries a Zacks Rank #2 (Buy).
Some other top-ranked stocks in the Auto space are Standard Motor Products, Inc. (SMP - Free Report) , EVgo, Inc. (EVGO - Free Report) and Lucid Group, Inc. (LCID - Free Report) . SMP, EVGO and LCID carry a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Zacks Consensus Estimate for SMP's current-year earnings is pegged at $4.3 per share, indicating a 7% year-over-year increase. Its earnings beat the Zacks Consensus Estimate in three of the trailing four quarters and missed once, with the average earnings surprise being 11.5%.
The Zacks Consensus Estimate for EVGO's current-year loss is pegged at 53 cents per share, indicating a 71% year-over-year decrease. Its earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, with the average surprise being 40.7%.
The Zacks Consensus Estimate for LCID's current-year loss is pegged at $12.15 per share, indicating a 0.5% year-over-year decrease. Its earnings missed the Zacks Consensus Estimate in each of the trailing four quarters, with the average negative surprise being 30.3%.