Honda switches production of SUVs to China from US
The Japan-based automotive manufacturer, Honda, is set to accelerate its output of Acura luxury vehicles in China by transitioning to local production of a new version of an SUV model instead of importing it from the US, Nikkei Asian Review reports.
The company develops automotive vehicles through its two collaborations that are set up with Guangzhou Automobile Group and Dongfeng Motor Group.
With its combined vehicle sales in China amounting to 1.45mn units in the year ending in March 2018, it made up approximately 30% of the firm’s total output.
Vehicle imports from the US are subject to 40% tariffs imposed by the government due to the trade friction between Washington and Beijing.
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Through the move, Honda hopes to expand its cost competitiveness and encourage more local demand.
In July, it was revealed that China decreased tariffs on imported vehicles to 15% from 25% with the exception of US manufactures cars which rose to 40%.
China remains Honda’s second biggest production country after the US, which produces 1.64mn in the same year.
It is anticipated that sales of the new Acura RDX will begin before the end of 2018.