Honda, Toyota hike subcompact output

Honda, Toyota hike subcompact output

TOKYO: Seeing growing demand for fuel-efficient subcompacts amid oil price surges in Southeast Asia, Honda Motor Co. and the Toyota Motor Corp. group are poised to increase their Indonesian production of small vehicles, the Nihon Keizai Shimbun reported in its Wednesday morning edition.

Toyota and subsidiary Daihatsu Motor Co. plan to boost output of a jointly developed subcompact -- sold by Toyota as the Avanza and marketed by Daihatsu as the Xenia -- to 77,100 units this year, with plans to raise it even further to 84,000 in 2006. Sales of the 1- to 1.3-liter vehicle are growing domestically as well as in such neighboring markets as Malaysia and Thailand.

Honda will bolster the capacity of a suburban Jakarta factory that manufactures its Jazz subcompact from 50,000 units to 60,000 next year. The 1.5-liter vehicle is selling well in Thailand and Indonesia, with Indonesian sales expected to jump 30 percent to more than 30,000 units this year.

The market for highly efficient subcompacts is expected to grow in Southeast Asia, which like many other regions has been hit hard by soaring oil prices. The emergence of the middle class is also helping to shift demand from minivans to subcompacts. -- Dow Jones