It seems Honda will have to figure out its car production strategy in Thailand after the automaker recently announced it will be closing one of their automobile factories in the country.

According to a report by Reuters, Honda stated they will halt vehicle production at the Ayutthaya factory by 2025. They then plan to consolidate its output to another factory located in the Prachinburi province – hoping to close the gap between vehicle production and sales. But why did Honda decide to close one of its automobile plants in The Land of Smiles?

Aside from consolidating its production in one factory, the closure appears to stem from Honda experiencing lower sales figures over the past several years. As of late, the automaker's sales figures in Thailand have been under 100,000 units for the last four years as Chinese automakers continue to expand not just in Thailand but also across Southeast Asia.

In recent data, combined production output from the two plants fell from 228,000 units in 2019 to less than 150,000 vehicles in 2023. Combined with the fact that Honda has been selling fewer than 100,000 vehicles for the past four years and the arrival of aggressive Chinese brands in the market, the Japanese automaker is currently facing several issues.

But what does the closure of the Ayutthaya plant mean for Honda Philippines? Well, the soon-to-be-closed factory makes the ICE & e:HEV variants of the CR-V and Civic for both Thailand and the rest of Southeast Asia. With the facility closing in 2025, production of the CR-V and Civic in the region could temporarily be affected as Honda consolidates production to Prachinburi.

Despite closing the facility in 2025, Honda will not be letting go of the Ayutthaya factory as they plan to convert it into a parts factory moving forward. There are no exact details yet as to what parts Honda plans to make in the facility.

With Honda's Ayutthaya factory set to shut down by 2025, we hope that the production and customer deliveries of the Honda CR-V and Civic in the region will not be affected that much.