Honda Motor Co. has announced plans to spend about $644 million to build a new car plant in Thailand and expand an existing factory.
Japan's third-largest automaker said its subsidiary in Thailand will build the new assembly factory in Prachinburi Province, about 120 km east of Bangkok, at a cost of 17.15 billion baht ($575 million).
With production capacity of 120,000 vehicles annually, the plant is scheduled to begin operations in 2015 with initial plans to hire some 1,200 employees, Honda said.
The automaker said it will mainly produce small and subcompact vehicles at the plant in response to growing global demand.
Honda separately said its Thai unit has finished expanding production at its Ayutthaya plant from 240,000 vehicles a year to 280,000.
It now plans to boost that figure to 300,000 units in 2014 at a cost of about 2.03 billion baht.
That would bring the automaker's combined annual output capacity in Thailand to 420,000 vehicles in 2015, including output from the new plant.
The new plant is expected to start operating in April 2015 and the Ayutthaya plant, which has recovered from severe flooding in 2011, will complete its expansion next year.
Hiroshi Kobayashi, president of Asian Honda Co., said Honda is aware of future flood risks in Thailand but is prepared to deal with them at both plants.