Honda 2008 Annual Report Download - page 55

A n n u a l R e p o r t 2 0 0 8 5 3
facilities. As one of our plans to increase the local production
of automobile powertrain components in North America,
Honda Transmission Mfg. of America, Inc. completed
construction of its facilities for the production of high precision
gears in July 2007.
In the financial services business segment, capital
expenditures excluding property on operating leases
amounted to ¥627 million in the fiscal year ended March 31,
2008, while capital expenditures for property on operating
leases were ¥839,261 million. Capital expenditures in power
products and other businesses in the fiscal year ended March
31, 2008, totaling ¥21,794 million, were deployed to upgrade,
streamline, and modernize manufacturing facilities for power
products, and to improve R&D facilities for power products.
Our finance subsidiaries in North America have historically
accounted for all leases as direct financing leases. However,
starting in the year ended March 31, 2007, some of the leases
which do not qualify for direct financing leases accounting
treatment because of the termination of insurance contract
covering the estimated residual value of vehicles leased to
customers are accounted for as operating leases. Therefore,
because of the transfer from direct financing leases to
operating leases, capital expenditures of the Company have
increased from the year ended March 31, 2007.
Plans after fiscal 2008
We set out our original capital expenditure plans for the
period from the fiscal year ended March 31, 2008 during the
preceding fiscal year. We have subsequently modified these
plans as follows:
The investment amount of the new R&D center in Sakura
City, Tochigi, Japan has changed from approximately ¥17,000
million to ¥48,000 million because of the expansion of the
building. The planned timing of the commencement of the
center’s operations has not changed.
The investment amount of the new auto plant in Yorii-
machi Oosato-gun, and the new engine plant in Ogawa-machi
Hiki-gun, Saitama, Japan has changed from approximately
¥70,000 million to ¥158,000 million because of the change
of operations to strengthen the business competitiveness,
strengthening of measures to environment, acquisition of land,
inclusion of land development expenses, and a substantially
increased building materials prices. The planned timing of the
start of operation has not changed.
We have set out our capital expenditure plans for the
period from the fiscal year ending March 31, 2009 as follows:
In order to respond efficiently to increases in global
motorcycle demand as well as to advancements in products
and improvements in production engineering, Honda plans
to consolidate all motorcycle production in Japan at its
Kumamoto Factory with an investment of approximately
¥33,000 million. This new motorcycle plant plans to start
operation in 2008. The annual production capacity of
Kumamoto Factory will be approximately 600,000 units.
Honda Siel Cars India Limited, which is one of the
Company’s consolidated subsidiaries, plans to build a
new auto plant in Rajasthan, India with an investment of
approximately $230 million. The annual production capacity
of this new plant will be approximately 60,000 units. This new
auto plant plans to start operation in the end of 2009.
Honda Automobile (Thailand) Co., Ltd., which is one of
the Company’s consolidated subsidiaries, plans to build a
new auto plant in Ayutthaya, Thailand with an investment of
approximately 6,200 million bahts. The annual production
capacity of this new plant will be expandable up to
approximately 120,000 units. This new auto plant plans to
start operation in the latter half of 2008.
Honda Motor de Argentina S.A., which is one of the
Company’s consolidated subsidiaries, plans to build a new
auto plant in Buenos Aires, Argentina with an investment of
approximately $100 million. The annual production capacity
of this new plant will be approximately 30,000 units. This new
auto plant plans to start operation in the latter half of 2009.
Yachiyo Industry Co., Ltd., which is one of the Company’s
consolidated subsidiaries, plans to build a new auto plant
capable of synchronous auto production—from the engine
to the entire automobile—in Yokkaichi City, Mie, Japan with
an investment of approximately ¥50,000 million, to further
strengthen the mini-vehicle business. The annual production
capacity of this new plant and the current operating plant will
be approximately 240,000 units, which is the same as the
current production capacity. This new auto plant plans to start
operation in the latter half of 2010.
The estimated amounts of capital expenditures in fiscal
year ending March 31, 2009 are shown below.
Fiscal year ending
March 31, 2009
Yen (millions)
Motorcycle Business ¥136,600
Automobile Business 549,800
Financial Services Business 1,300
Power Product and Other Businesses 22,300
Total ¥710,000
The estimated amount of capital expenditures for Financial Services
Business in the above table does not include property on operating
leases.
0
200
400
600
08_07_06_05_04_ 0807060504
Capital Expenditures and
Depreciation
Years ended March 31
)snoillib(neY
Capital Expenditures
Depreciation
0807060504