Honda to Slash Exports of Japan-Built Cars by Half

Japan’s number two automaker will cut by half the number of cars it exports from domestic factories to counter the impact of a soaring yen, Honda president Takanobu Ito told Asahi Shimbun.

The proportion of Japan-built Honda cars sent overseas will be cut from 34 percent to between 10 and 20 percent over the coming decade, according to Ito.

In fiscal 2010, which ended in April of 2011, Honda exported 310,000 of the 910,000 vehicles it manufactured in Japan, far lower than the 53 percent export ratio of Japan’s auto industry as a whole. But further cuts are needed to stay profitable.

During the same period Honda manufactured a total of 3.57 million vehicles worldwide. In an effort to keep its domestic production capacity at around 1 million vehicles, Honda plans to increase the mix of inexpensive minicars, doubling it from 150,000 in fiscal 2010 to about 300,000 in the current year. Honda will introduce a new minicar model in December, with several others in the pipeline.

Suzuki and Daihatsu are pursuing a similar strategy.

Japan’s domestic auto production has fallen nearly 20 percent during the past decade to only about 5 million vehicles today.