Honda Motor Co.'s joint venture with Dongfeng Motor Corp. will resume its plan to build a third assembly plant to keep pace with fast-rising sales.

 

The joint venture will break ground for the new factory in the central China city of Wuhan this year, according to Chinese media. 

 

The plant will launch production in 2018, reported cnhubei.com, a Wuhan-based news website.

 

In 2013, the partnership announced a plan to add a 5.2 billion yuan ($776 million) plant with an annual production capacity of 240,000 vehicles. But it shelved the plan after sales dropped 4 percent in 2014 due to a lack of new models. 

 

Dongfeng Honda subsequently upgraded its existing models and launched three new ones: the Jade and Greiz compact sedans, and the XR-V compact crossover. Sales jumped.

 

Last year, sales rose 35 percent to 173,168 vehicles. And in the first six months of 2016, sales surged 43 percent year on year to 173,168 vehicles. 

 

The joint venture currently runs two assembly plants in Wuhan with combined annual capacity of 480,000 vehicles. 

 

Honda also has a partnership with Guangzhou Automobile Group Co. in the south China city of Guangzhou, which can produce up to 600,000 vehicles a year. In the first six months, deliveries of Guangqi Honda rose 3 percent from a year earlier to 287,751 vehicles.