Honda Motorcycle & Scooter India (HMSI) has laid the foundation stone  for its fourth manufacturing plant at Vithalapur near Ahmedabad, Gujarat.

Spread across 250 acres, HMSI will invest Rs 1,100 crore to build the plant, and it is expected to start operations by 2015-end. This flagship plant will have an annual production capacity of 1.2 million units, making it the largest scooter-only manufacturing facility.

Honda has been facing difficulty in matching the huge demand in India for its popular Activa series (which continues to see a waiting period in some states) and other scooters. This new plant will help Honda expand its total scooter manufacturing capacity to 5.8 million units, including 1.6 million units made at the Haryana plant, 1.2 million produced at the Rajasthan plant, and 1.8 million made at the Karnataka plant.

An aggressive Honda India is looking to selling almost 45 lakh two-wheelers in India this year. Commenting on the importance of the India market to Honda, Noriaki Abe, chief operating officer, Honda Motor Company Ltd (Asia & Oceania Region) said: “As the world’s biggest two-wheeler market, India is already a priority market for Honda. In the current fiscal 2014-15, Honda aims to sell 18.2 million two-wheelers worldwide and for the first time, India will contribute almost 25 percent to global Honda sales. We have huge expectations from this project as this will be our flagship and benchmark plant in India in terms of volume, safety, quality, cost, associate skill and moral.”

On the occasion, Yoshiyuki Matsumoto, managing officer, Honda Motor Co said, "With the fourth plant, we aim to reach closer to the vast market in West (India), which contributes over 25 percent to Honda business. The new plant will employ approximately 3,000 people within the first two years of commercial production and will entail a Rs 1,100 crore investment.”

Honda has presence in more than 40 countries globally.