SWINDIN, UK - Honda will build a new assembly plant at its factory complex here,lifting UK capacity by 100,000 units to 250,000 by 2000.
In 2002, Honda will produce a new supermini-class car in Swindon in addition to the Civic and Accord.
The Japanese carmaker said that it will invest £450 million ($735 million) at Swindon by the end of 2002, including £130 million for the second assembly plant at the site.
The second plant will start production of a new Civic in 2000.
Honda also announced that it will invest £200 million for development of the new Civic and a new Accord that goes into production in Swindon next month. A further £120 million will go toward upgrading of the existing assembly plant.
'Europe is now more important than ever for our growth,' said Honda President Nobuhiko Kawamoto. 'Our current model lineup in Europe consists of medium and large cars. The small car, with its environ-mental benefits, will play an increasing role in future customer choice.'
Honda sold 235,288 cars in Europe last year, and aims to reach 250,000 this year. It targets 300,000 units in 2000, for 2 percent of the European market.
But executives say that growth hinges on selling more small cars. Honda's 2 top European sellers are currently the lower-medium Civic and upper-medium Accord.
Next year, Honda will introduce two new superminis from Japan based on the J-Mover concept car series shown at the Geneva auto show in March. A third will follow in 2000.
The first two are the J-BX, a 3785mm-long family car that shares a platform with the two-year-old Logo in Japan, and the 3950mm-long J-WJ off-road concept.
Both will arrive in Europe in mid-1999. They will be aimed at cars in the Ford Fiesta and GM Corsa class.
A third J-Mover model, the 3840mm-long J-VX sporty version, will arrive in 2000.
The J-Mover series will be imported from Japan in 'modest numbers,' according to a company spokesman. He said that the super-mini to be built in Swindon starting in 2002 will differ from the J-Mover series.
'Honda's decision to build its new small car at Swindon is a massive vote of confidence in Britain as a center for car production,' said
UK Trade and Industry Secretary Margaret Beckett.
The investment will give a boost to domes-tic component makers, she added.
Honda began engine assembly at Swindon in 1990 and car production in 1992.
Honda will build 130,000 cars at Swindon this year, including 65,000 Civic five-door mod-els, 20,000 Civic Aerodeck versions and 36,000 Accords.