Honda Motor Co. has officially announced that the company will be producing its Honda Fit small car at its new plant in Mexico in order to export the vehicles to the United States, along with other markets. The company is now expanding its local production to combat the Japanese yen’s profit-eating strength. The production of the Honda Fit in the plant near Celaya, Guanajuato, will start in 2014 with a capacity of 200,000 vehicles a year.

Even though Honda announced about the plant last year in August, a little confusion existed regarding the model to be built at the plant. However, the company broke news about its plans to produce the Honda Fit at a ceremony held recently. It is expected that the production capacity of Honda in North America will increase to 1.87 million units from 1.63 million by early 2014. Earlier, the company also announced that it would produce the next generation Acura NSX sports car in Ohio, which is expected to go on sale by the end of 2014.

Honda is fighting the yen’s towering foreign exchange rate against the dollar and euro, which drastically undercuts profits. Hence the company now concentrates on its vehicle production outside Japan. “Honda will soon produce everything from subcompacts to super cars in North America,” said Rick Schostek, senior vice president of Honda of America Manufacting Inc.

“Last year, more than 85 percent of the Honda and Acura models sold in America were built in the U.S., Canada and Mexico, using domestic and globally sourced parts. And this will reach more than 90 percent in the coming years,” he added. In 2011,Honda sold 59,235 Honda Fit’s in the United States, which is a 9 percent gain over 2010 sales.

via Autonews