Honda to make 90% of US sales locally by relocating Mexico, Canada production, Nikkei reports

TOKYO: Honda is considering switching some car production from Mexico and Canada to the United States, aiming for 90% of cars sold in the country to be made locally in response to new U.S. auto tariffs, the Nikkei newspaper reported on Tuesday.

Japan’s second-biggest automaker by sales plans to increase U.S. vehicle production by as much as 30% over two to three years in response to U.S. President Donald Trump’s decision to put a 25% levy on imported vehicles, Nikkei said.

Honda declined to comment, saying the information was not announced by the company.

In the weeks before the new U.S. levy went into effect, Reuters had already reported that Honda plans to make its next-generation Civic hybrid in the U.S. state of Indiana, instead of Mexico, to avoid potential tariffs.

The U.S. was Honda’s biggest market last year, accounting for nearly 40% of global sales. The automaker sold 1.4 million vehicles, including Acura models, in the U.S. last year. It imported about two-fifths of those cars from Canada or Mexico.

Honda posted a 5% rise in U.S. sales to almost 352,000 vehicles in the first three months of this year.

The company will move production of the CR-V SUV from Canada to the U.S. and that of the HR-V SUV from Mexico to the world’s biggest economy, according to Nikkei.

To increase output, Honda is considering hiring more U.S. workers, the newspaper said. Such a step would make it possible for Honda to switch to a three-shift system from two-shift work and extend production to weekends, Nikkei added.