Honda Motor Co. announced on Tuesday that it will cease automobile production at its Ayutthaya plant in Thailand by 2025, and plans to consolidate production at its Prachinburi plant.
This move highlights the challenges faced by Japan's second-largest automaker in Southeast Asia, particularly as Chinese brands actively vie for market share in Thailand and consumer demand for electric vehicles grows.
Honda plans to continue producing auto parts at the Ayutthaya plant, which was first established in 1996, after ceasing car production.
A company spokesperson stated that Honda will concentrate its automobile production at the Prachinburi plant, which was opened in 2016. These two facilities are Honda's only production sites in Thailand.
Honda indicated that the combined output of these two plants has dropped from 228,000 vehicles in 2019 to less than 150,000 vehicles annually in 2023.
Over the past four years, Honda's sales in Thailand have remained below 100,000 vehicles annually.
The spokesperson noted that Honda aims to bridge the gap between automobile production and sales in Thailand.
However, the spokesperson also mentioned that Honda has been exporting cars from Thailand to other Southeast Asian markets, primarily Indonesia and the Philippines.
The spokesperson added that Honda currently has no plans for new investments in Thailand.
In China, Honda and its competitor Nissan Motor Co. are facing fierce competition from rising Chinese brands that attract consumers with low-priced, software-rich electric and plug-in hybrid vehicles.
