Honda (TYO:7267) To Make 80 Business Jets Every Year By 2019

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The Honda Motor Co. (TYO:7267) of Japan has announced that the company will be making 80 business jets every year by March 2019. That will be a substantial expansion for Honda if they are able to achieve this. It also means they are going to ramp up their production capacities by a great deal. Production is going to go up gradually.

Currently, the Minato, Tokyo-based business makes about 36 jets annually or about two to three crafts in a month. That has to go up to six or seven every month if they want to achieve the 80 figure.

This was revealed by Michimasa Fujino, the CEO of Honda Aircrafts, while speaking to reporters at their plant in North Carolina. He said, “By the end of the 2018 financial year (in March 2019), we’d like to be near full production of around 80 units”.

Engine Parts to Be Made In-House and Sold to Others

The CEO also revealed that Honda is going to make many core engine parts in-house from March 2017, and they want to sell these parts as well to aircraft manufacturers. Honda is going to come up with a new factory for this because it will help them lower costs, improve quality, and become more competitive. The HF 120 engines for the jets have been developed jointly with General Electric. Presently, all parts for the aircraft’s are procured from outside suppliers.

Honda Already Has 100 Orders to Deliver

Deliveries of it’s $4.5 million jets have started already. It was also disclosed that Honda (TYO:7267)  already has about 100 orders at this time, mostly from customers in Europe and North America. 20 jets have been delivered already.

The business jets Honda makes are of the same size as the ones made by Bombardier (TSE:BBD.B) of Canada, Embraer SA of Brazil, and Cessna, making them Honda’s competitors.

Honda is the first auto maker from Japan that is developing and selling aircrafts globally. While businesses like Toyota and others are getting into electric cars, Honda is diversifying into aircrafts. Their luxury business jets have seats for seven people. The engines are located above the wings making the cabins roomier. The aircrafts have better fuel efficiency and reduced noise as well.

The flagship HondaJet has been developed since 1986. The U.S. Federal Aviation Administration has given their certification, marking these crafts safe for flight. The global business jet market is worth almost $25 billion.