Bangladesh Honda Private Limited (BHL), Honda’s motorcycle business joint venture in Bangladesh, has held the grand opening of its new motorcycle factory in the Abdul Monem Economic Zone, Char Boushia, Gazaria, Munshiganj Disrict, Dhaka Division in Bangladesh.
Honda is expanding its business in Bangladesh. As one of its core responsibilities, BHL is leading the development of the country’s motorcycle industry and contributing to the industrialisation of Bangladesh.
The company has relocated its factory from Gazipur to the new location in the Abdul Monem Economic Zone.
Honda, along with its partner Bangladesh Steel and Engineering Corporation (BSEC), invested a total of 2.3 billion Bangladeshi Taka on buildings, equipment, facilities, and a land area of 25 acres for the new factory.
The factory itself, which currently occupies one-third of the property, took a year to complete following the groundbreaking ceremony held on November 5, 2017. It will have an initial annual production capacity of 100,000 units of motorcycles.
In line with market trends, BHL plans to continue to invest in expanding its production capacity to 200,000 units by 2021, and will build its full-phase factory on the remaining two-thirds of the property to accommodate future market growth.
The motorcycle industry in Bangladesh is undergoing rapid growth with strong government support, including promoting a localisation policy and reducing supplemental duty in December 2016.
This enables BHL to enhance the localisation of component parts, which will increase cost effectiveness for the models of motorcycles produced at the new factory.
For example, the new factory is introducing welding and painting sections for localisation with technical support from Honda Motor in Japan.
Initially, BHL will localize the body frame and swing arm and then gradually expand localisation to other parts assembled at the new factory in the future.
The new factory opens up more opportunities for employment and technology transfer to local associates. Currently, the company has 390 associates, and BHL plans to increase the number of associates in line with its business expansion.