TSX69

Why is the NSX Being Built in Ohio?

3 years (on top of the 3-plus we've already waited) is a long time to wait for the 2nd coming of the Acura NSX. Measured in Internet time, it's an infinite opportunity for speculation about the whys and hows of the new car. Aside from the new supercar's hybrid powertrain, the most shocking part of the announcement is that the car will be built in Ohio. Honda has an engine plant, a transmission plant, 2 assembly plants and a research and development center in the state, so this shouldn't be treated with the same level of surprise as if, say, Ferrari announced it would start building cars in Kansas.

Yet it's still a big change for the exotic Acura, which was manufactured in Japan during its entire 1st-generation lifecycle, from 1990-2005. When the NSX debuted, part of its appeal was that it represented the pinnacle of Japanese technology and quality, at a time when Japanese automakers were absolutely crushing the competition in both. Times have changed, but we still suspect that a number of fanboys might be disappointed that the 2nd-generation NSX will be built by gaijin.

We spoke with American Honda CEO and president Tetsuo Iwamura about the decision to develop and manufacture the NSX here in the U.S., and he told us that the decision was made for 3 reasons. The 1st is that Honda is committed to building cars in the market in which they are sold. The U.S. is the largest market for the NSX, although he said the car will be exported to Japan and other markets.

When asked if there was any concern that Japanese customers might have objections to a Japanese supercar built in the U.S., Iwamura said, "You don't have to be so modest. American-built cars have a power, even in Japan."

The 2nd factor was that Honda has had positive experiences with product development of other models here in the States. Iwamura specifically mentioned the North American market-only Pilot and Odyssey as examples. The 3日d reason for the decision to build the NSX here is that Honda believes its Ohio manufacturing facilities produce high-quality products and wants to take advantage of that expertise. Iwamura also said that assigning the halo car to the U.S. would be motivational for its American employees.

Currency fluctuation, however, was not a consideration, according to the Honda chief. While he said that would indeed be the case with a mass-market model, the limited-production nature of the NSX makes the effect of a strong yen a moot point. Regardless of where its built, Iwamura said the main consideration in bringing the NSX back to market is its technology, quality and performance, just as the original did. The NSX is an important part of modern automotive history, a literal poster-child of the '90s, so we're certainly rooting for this new exotic Buckeyemobile to deliver on all fronts.

MASK

I want this NSeXY II.
Global Economy means Diversity and the US
has long needed more than just 1 Supercar
domesticly manufactured (Corvette).

Tang Shelby GT is great but is it a Supercar ??

justnspace

iTrader: (1)

the wheels are so ugly.

TSX69

Ohio Grabs Acura from Japan as Yen Fuels Exodus to US

Honda Motor Co.'s choice to build what it calls a racing-oriented "supercar" in Ohio highlights confidence in its U.S. engineers and plants. It also shows the difficulty of producing autos in Japan as the yen rises.

When the high-performance hybrid Acura NSX goes on sale within 3 years, it will be the most expensive and technologically advanced car ever built in the U.S. by an Asian or European automaker. Ohio will be the sole global production site for the car executives suggest will sell for more than $100,000.

"This is a halo vehicle," said John Shook, a former Toyota engineer, referring to a model that represents the highest ideal of a brand. He is also chairman of the Lean Enterprise Institute in Cambridge, Massachusetts, which consults on efficiency techniques. "Where you make it makes a statement. It's a great thing for their local operation, and indicative of challenges in Japan."

The surprise NSX plan, revealed by President Takanobu Ito in Detroit last week, follows Honda's August announcement that a Mexican plant will make small cars to curb losses from exporting models such as the Fit from Japan. The 2 projects will give Honda the ability to produce its entire vehicle range, from cheapest to most expensive, within North America, a 1st for any carmaker based outside the U.S.

'Pulp Fiction'

The original $89,000 NSX that sold from 1989 to 2005 was built in Suzuka, Japan, and was favored by performance-car fans for its high power and light, all-aluminum body. It gained pop- culture fame when it was driven in 1994's "Pulp Fiction" by Winston "The Wolf" Wolfe, played by Harvey Keitel.

Noting a destination is 30 minutes away, he says: "I'll be there in 10."

Honda's production shift along with rising North American capacity for Toyota Motor Corp. and Nissan Motor Co. signal a long-term move by Japan's automakers to battle currency-related losses.

The yen has risen 7.7% against the dollar in the past 12 months, the strongest performer against the 16 most- traded currencies tracked by Bloomberg. Each 1 yen rise against the currency cuts Honda's operating profit by 15 billion yen ($195 million), according to the company.

"It may be an appeal to the U.S. market, to show Honda starting production of an edgy car in the U.S.," said Mitsushige Akino, who oversees $600 million at Ichiyoshi Investment Management Co. in Tokyo. "It may also be a message to the Japanese market of Honda's actual start of a production shift."

Honda, which has its U.S. headquarters in Torrance, California, also needs the new sports car to attract customers to other Acura models. U.S. deliveries of the brand's cars and sport-utility vehicles fell 7.7% last year to 123,299.

The company's American depositary receipts rose 1.9% to $34.54 at the close in New York. They've gained 13% this year.

'Hollowing Out'

Carlos Ghosn, chief executive officer of Nissan and its alliance partner Renault SA, has warned that unless Japan finds a way to tame the yen's rise, the country's auto industry faces a "hollowing out" of domestic production.

Nissan has moved fastest among Japan's automakers to shift production of low-cost autos to Thailand and Mexico, and last year was the 2nd-biggest importer of vehicles into Japan, behind only Volkswagen AG.

Honda's choice to make its costliest model abroad is unprecedented, said Koji Endo, an auto analyst at Advanced Research Japan.

"I was surprised," said Endo, who is based in Tokyo. "Even with this currency burden, I believed NSX would be 1 of the models that kept production in Japan, being high-end and with a hybrid system."

Responsible Fun

The all-wheel-drive NSX will have a newly developed 2- motor hybrid system that Honda says delivers high performance and handling as well as fuel efficiency.

"Even as we focus on the 'fun to drive spirit' of the NSX, I think a supercar must respond positively to environmental responsibilities," Ito said in Detroit on Jan. 9.

The company plans to race the car as well as sell it, said Ito, who was lead engineer on the 1st NSX in the 1980s. Its "mid-engine" design houses most of the weight of the powertrain in the center of the vehicle for optimal balance and agility.

While Honda doesn't yet make any hybrids in North America, this year it starts producing a gasoline-electric version of the new Acura ILX sedan in Greensburg, Indiana.

'Stretch Goals'

"Honda believes in setting 'stretch goals' for engineers, and that's clearly what NSX represents," said Jeff Liker, an engineering professor at the University of Michigan in Ann Arbor. "Their U.S. engineers have a high level of capability, but Honda also has these very expert engineers back in Japan to ensure the U.S. team succeeds."

3 reasons led to the choice to develop and build the NSX in Ohio, Tetsuo Iwamura, Honda's chief operating officer for North America, said in an interview last week.

"The U.S. is the largest market for it," Iwamura said. "It has a well-experienced, capable development team, and a very efficient, high-quality production team. That made it possible."

From Ohio, Honda will export the car to Japan, Europe, China and other markets, he said. The company isn't yet announcing the car's price, how much it will invest in an assembly line to build NSX or that factory's precise location.

All Honda plants in Ohio, including engine and transmission factories, will be involved in the project and many components and materials will be locally sourced, Iwamura said.

"Final assembly will be done with a small-scale facility, but including components we need to make use of the current Ohio production base," he said. "We have to ask suppliers, especially U.S. suppliers, to accommodate our request as much as possible."

30 Years

J.D. Power & Associates rated four of Honda's North American assembly lines among the region's 5 best in 2011. The company's Greensburg plant that opened in 2008 even won a "platinum" rating last year for new-car quality, tying 2 Lexus plants as the world's best.

Honda was 1st among Asia-based manufacturers to open an auto-assembly plant in the U.S., with its Marysville, Ohio, factory in 1982, and added its premium Acura line in 1986, ahead of Toyota's Lexus and Nissan's Infiniti.

In contrast to those 2 competitors, most Acuras sold in the U.S. are already built in North America, while Lexus and Infiniti count on Japan for most of their lineup.

Including the new ILX, 5 of 7 Acura models sold in the U.S. are made in the U.S. or Canada. Toyota builds only the Lexus RX sport-utility vehicle in North America, and Nissan is preparing to build Infiniti JX SUVs in Tennessee, after previously ending U.S. production of Infiniti models.

Entire Line

Honda may eventually produce its entire Acura line in North America, Iwamura said.

"Seeing the current trend, Acura models could be produced more in the U.S.," he said. The RL, now the most expensive Acura with a $47,700 base price, may remain in Japan, Iwamura said.

"If there's a good reason to bring that model from Japan to here, we could do that, but we don't have a plan -- at this moment," he said.

Toyota, Japan's largest automaker, plans to reduce exports from its home-country factories and build up North America as an export base, Yoshimi Inaba, chief operating officer for the region, said in Detroit last week. That may include adding production capacity in Mexico, Inaba said.

Nissan, Too

Nissan, too, is boosting production at auto plants across the Americas to offset currency-related losses, Bill Krueger, vice chairman for the region, said Jan. 11 in Detroit. The Yokohama-based company's goal is to get 85% of Nissan and Infiniti cars and trucks sold in North and South America from plants in the region, up from 70% now.

Honda, which typically sells the highest portion of autos in the U.S. from North American plants among Asian automakers, was already at an 85% local production rate in 2011.

For the Acura brand alone, 74% of models sold in the U.S. were supplied by regional factories.

The Suzuka plant that made the original NSX is taking on production of low-cost minicars and their small engines, the company said this month. Such vehicles are sold mainly in Japan.

"Suzuka remains the base for next-generation technology," said Tomohiro Okada, a company spokesman in Tokyo. "Production of these new minicars requires the top technology, in terms of weight and cost savings."

EL_PIC

How bout F1's in gun powder grey - only $10K a set ?

TacoCodeRed

well honda's are the most american assembled car you can get. ford and chevy cant say that anymore.

Steven Bell

iTrader: (2)

I'm glad this will be built in America-can't wait.

Meeyatch1

They have already selected the building the are using exclusively for NSX production, so it will be interesting to see if they can get the car ready, and have all of the tooling ready, to start making pre-production cars within the next 12 months to have the car ready to roll out to buyers in 2014 as a 2015 model year car.