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Honda’s impact goes beyond manufacturing

Oct 24 2016

Honda spent more than $24.4 billion for parts and materials from U.S. suppliers for its North America operations last year, including several companies in Clark County, the company said.

That is a roughly $1 billion increase from last year, when the automaker spent approximately $23.4 billion in parts and materials, said Chris Abbruzzese, a spokesman for the company. Honda spent about $23.1 billion in 2013, he said.

Officials from the automaker were unable to break down spending in the Miami Valley, but local economic development officials said Honda’s spending has a significant impact on the region’s employment and the success of local companies.

Overall, the company utilized services from 596 suppliers across 34 states, company officials said.

About 1,400 workers from Clark and Champaign counties work for the automaker, and it employs about approximately 14,500 Ohioans overall. Several area companies, including KTH Parts Industries in St. Paris and Parker Trutec in Springfield and Urbana supply parts for Honda.

The company operates facilities in Anna, Marysville, Troy and East Liberty, as well as a transmission plant in Russels Point. The company also operates a research and development facility in Ohio.

“It’s a far-reaching company in the entire state and beyond,” said Marcia Bailey, economic development coordinator for the Champaign Economic Partnership. “There’s a huge number of our resident base that works for Honda.”

Company officials said Honda has hit sales records for two consecutive years. Honda cruised to a new sales record in 2015 as experts have previously said the auto industry overall benefited from low interest rates and an improving economy.

Honda reported earlier this year that in 2015 it set an all-time record for single-year North American auto production, with total production of 1,862,491 Honda and Acura vehicles. That’s an increase of 3.1 percent over the previous record set in 2014, company officials said.

Honda’s eight auto plants in North America produced more than 99 percent of the Honda and Acura cars and light trucks sold in the U.S. in 2015.

The company’s success has benefited firms like KTH Parts Industries in St. Paris. The Champaign County company ships more than 24 million parts to customers every year, said Chris Millice, vice president at KTH. The company is a Tier-1 supplier for Honda, and currently employs slightly more than 1,100 workers at its facility in St. Paris.

KTH announced an expansion earlier this year that is expected to put the firm in a competitive position through at least 2023 and push the size of the existing facility past 1 million square feet. The company is also investing between $23 million and $34.5 million in equipment and new construction.

“It has a direct impact to our production volume and revenue since Honda’s business is the pillar of our company,” Millice said of Hond’a impact locally. “Obviously we benefit when demand for the Honda products are strong.”

The company has also been active in local efforts to improve training options for students interested in manufacturing, Bailey said. Like many high-tech manufacturing firms, she said the company is helping local officials develop programs that train students for careers that increasingly demand math and science skills.

By Matt Sanctis via Springfield News-Sun

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