The new Yorii Plant, the manufacturing facility constructed by Honda Motor at its existing Saitama Factory in Japan, has begun full-scale operation (Fig. 1). The plant came online in July 2013, and ramped up to full-scale, two-shift production in September. A ceremony commemorating the event was held on November 7, and the line opened to the press. The production target is 1050 new Fit compacts a day, which works out to under 50 seconds per unit, and the firm plans to gradually increase daily output to slash tact time even further.

Fig.1 Layout of the Yorii Plant
As a core facility for developing manufacturing technology, the Yorii Plant is equipped with a variety of new technologies designed to boost cost competitiveness. Total output is 250,000 units/year, including compact Fit SUVs and sedans. It handles the entire manufacturing process, including stamping, welding, painting, plastic part (bumpers and instrument panels) forming, assembly, and vehicle inspection, employing about 2200 people.

Some people in the automotive industry have already called it the “last Completely Built-up Unit (CBU) manufacturing line in Japan,” and they have a point: domestic automobile sales have been, at best, flat, and are trending down. Other Japanese automobile manufacturers seem to feel that no new CBU lines are needed in Japan, and indeed Honda will have a tough time recouping its enormous capital investment into the new facility from a shrinking domestic market.

Even Takehiro Kono, Yorii Plant Manager, agrees that “We really didn’t need this plant to handle demand for the Japan market.” With the new plant, however, Honda closed down one of the two other lines at the Sayama Plant, located on the same site; if it had stayed in operation the production of the new Yorii Plant would have been unnecessary. So why did Honda build the new plant at all?