On July 26, Honda China's official WeChat official account said that Honda China would implement capacity optimization and accelerate the electrification transformation. Honda China stated that the adjusted total production capacity of Honda in China will be reduced from 1.49 million vehicles to 1.2 million vehicles. Specific measures include closing the fourth production line of GAC Honda with an annual production capacity of 50000 vehicles, and suspending the second production line of Dongfeng Honda with an annual production capacity of 240000 vehicles.
The above adjustment plan has also been confirmed by GAC Honda. The company currently has 4 complete vehicle production lines (with an annual production capacity of 770000 units) and 1 production line under construction (with a designed annual production capacity of 120000 units), of which the fourth production line with an annual production capacity of 50000 units is planned to be closed in October 2024. The relevant person in charge of Guangqi Honda told the Daily Economic News reporter that Guangqi Honda's existing production lines have always had the ability to flexibly adjust according to production plans and can flexibly respond to market demand. There is currently no decision to close other production lines.
In addition, the reporter learned that after the closure of Guangqi Honda's fourth production line, the original appearance of the building will be preserved, and the existing production facilities will be transferred or demolished, with plans to use them as warehouses in the future.
Honda China has already shown signs of adjusting its production capacity structure. In April of this year, Masayuki Igarashi, Executive Director and Head of China Department of Honda Motor Corporation, General Manager of Honda Motor Corporation (China) Investment Co., Ltd., and General Manager of Honda Motor Corporation (China) Technology Co., Ltd., revealed to reporters that Honda China is considering adjustments in productivity. The sales of gasoline cars have dropped significantly now, and we will consider whether to make adjustments in productivity. This is the problem we are facing now and also the one we need to solve, "said Yaxing Igarashi.
And this production reduction may be Honda's adjustment based on the transformation level. Honda China announced that while some factories are closed, the newly built Dongfeng Honda electric dedicated factory will start production in September 2024, and the new Guangzhou Honda new energy factory will start production in November 2024. The reporter learned that the combined annual production capacity of the two factories mentioned above is about 240000 vehicles, which means that after this round of capacity structure adjustment, Honda China's annual production capacity will be restored to 1.44 million vehicles by the end of this year, of which nearly 20% of the production capacity is dedicated to new energy vehicle models.
In terms of time, Dongfeng Honda's new electric dedicated factory was put into operation earlier than the shutdown of its second production line. One month after the closure of the fourth production line, Guangqi Honda's brand new new energy factory will also be put into operation. Behind the tight production capacity connection, it may be a signal for Honda to accelerate its electrification transformation.
In May of this year, Honda updated its global electrification strategy. Honda announced that it will invest approximately 10 trillion yen in resources before the fiscal year 2030. According to the plan, by 2030, Honda's sales of pure electric vehicles and fuel cell vehicles worldwide will reach 40%, and the annual production of pure electric vehicles will exceed 2 million units. To achieve this goal, Honda will strengthen three major measures, including launching pure electric models, building a comprehensive value chain of pure electric vehicles with batteries as the core, and promoting the optimization and upgrading of production technology and factories.
Honda still regards pure electric vehicles as the most effective solution in the field of small mobile tools such as second wheel drive and automobiles. In the long run, we believe that the transformation of pure electric vehicles will continue to steadily advance. Honda's goal of achieving 100% global sales of pure electric vehicles and fuel cell vehicles by 2040 has not changed. We will not be overly fixated on the current situation changes, but will focus on the upcoming period of pure electric vehicle popularization in the second half of 2020, and build a strong pure electric vehicle brand and business foundation from a medium to long term perspective, "said Toshihiro Sanbu, President of Honda's Executive Committee and Representative Office.
Prior to the release of its global electrification strategy, Honda officially launched its new electric brand "Ye" specifically for the Chinese market in April this year. The brand was designed by Honda's China R&D team, and the new car was produced by Dongfeng Honda and GAC Honda, and will be launched by the end of 2024.
In addition, Honda is actively collaborating with local Chinese companies and has been able to showcase its "Ye" brand products. For example, the production version of the "Ye GT Concept" model, which will be launched next year, will be equipped with a Huawei light field screen for the first time in the passenger seat.
In terms of power batteries, we are collaborating with CATL on project development. We will continue to jointly develop and promote models launched in the Chinese market. In addition to batteries, we have also explored and cooperated in the rapidly developing autonomous driving technology in the Chinese market, "said Gong Yuanzhe to reporters.