July 10, 2002, Tokyo - Honda Motor Co., Ltd., has announced that Honda Taiwan Co., Ltd., its local subsidiary, will begin production of automobiles by the end of this year, with plans to begin sales of automobiles in January 2003, through a new dealership network currently being established.

Honda Taiwan will start production with the new CR-V, which is enjoying robust sales in North America, the ASEAN region as well as in Europe. Current plans call for the production of additional vehicles in the future. Total investment in this new operation is expected to reach 3.4 billion yuan (approximately 12.2 billion yen or U.S.$101 million) with employment of 500 associates.

Production volume during the first year will total approximately 20,000 units. Honda's flexible New Manufacturing System will be introduced in this new facility making it possible to swiftly shift production from one model to another depending upon customer demand with only marginal additional investment. The low cost and efficiency of this flexible system will enable production of high quality vehicles at highly competitive prices.

Honda Taiwan will also import automobiles from Japan to broaden its product lineup, and the sales network will be expanded to 70 dealerships in 2004, with a yearly sales target of 35,000 units.

Honda established Honda Taiwan as a 100% owned local subsidiary in February 2002, after discontinuing its local partnership, in order to create an organizational structure that would enable it to fully utilize its global production and supply networks. Following this development, in June, Honda purchased land and a factory from local automobile manufacturer, Taching Motors Co., Ltd., located south of Taiwan. As part of the initial investment, additional production equipment will be installed in the facility by the end of this year to ramp up for the start of production.