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Published on September 20, 2014
According to a report of Nikkei Asian Review, a Japan based English language business journal, Honda has started looking for a site for the plant, which would have an annual capacity between 100,000 and 200,000 bikes.
The company, which currently assembles bikes using imported parts at a plant in Gazipur, plans to invest about $18.48 million for the new Bangladesh plant.
When the Honda’s new plant opens, production will be consolidated at Gazipur plant and there is also a plan to procure parts locally, opening up adequate employment opportunities for the local people.
Honda is setting up the new plant amid prospects of accelerated infrastructure development in the country and demand growth fueled by rising incomes, said the report.
In September 2012, Honda set up a joint venture company -- Bangladesh Honda Private Ltd (BHL) -- partnered with state-run Bangladesh Steel and Engineering Corporation (BSEC).
Under the joint venture, a factory with a production capacity of 80,000 units a year has been set up in Gazipur with an investment of Tk 61 crore.
Japanese Prime Minister Shinzo Abe visited Bangladesh this month and indicated that his government will help develop industrial infrastructure such as power plants, it said.
Under the leadership of Awami League government, Bangladesh has seen its economy expand at an annual rate of 6 percent with the per-capita gross domestic product amounted to $960 last year, coming close to the $1,000 mark, which is ideal for foreign motorcycle producers.
Honda's plan came at a time when two India’s motorcycle manufacturers -- Hero MotoCorp and Bajaj Auto – have already announced to set up motorbike factories in Bangladesh with forging partnership with local companies.
Hero MotoCorp, India's largest motorcycle manufacturer, will set up its manufacturing plant in Jessore by 2015 in a joint venture with Nitol Niloy Group and invest $40 million in five years.
Uttara Group, Bajaj Auto's local assembler, is set to build a plant at a cost of Tk 150 crore by June next year, to be operated by the leading Indian two-wheeler manufacturer.
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