AYUTTHAYA, Thailand — Honda Motor is set to begin production at a second plant in Thailand by the end of October, according to local reports. There the automaker will produce a new small entry-level car that will slow below the subcompact Jazz (Fit) and its sibling, the new City. Media are quoting Adisak Rohitasune, senior vice president of Asian Honda Motor, the regional operating company, in reporting that Honda invested the equivalent of $180 million in the new 120,000-unit integrated production facility located next to its existing car plant in Ayutthaya, the ancient capital of Thailand.The new plant doubles Honda's existing production capacity in Thailand to 240,000 units. The plant will be the first to operate under the Thai 'eco car' program and as such will qualify for significant tax incentives.To qualify for the incentives, the cars have to meet Euro IV emissions standards and get an equivalent of 47 mpg. A total of seven eco-car plants have been approved by the Thai government so far, with Ford and Nissan scheduled to start production in late 2009.Around 50 percent of Honda's small-car output is expected to be sold locally, with the remainder exported to other ASEAN markets, Australia, New Zealand and Europe. The local content target for the car was 70 percent.Honda currently produces the Accord, City, Civic, and Jazz models in Thailand, sold domestically and exported mostly to other ASEAN markets. Honda has a strong position in Thailand, having sold 58,517 units in 2007 for a 28 percent share of the passenger-vehicle market (excluding pickup trucks). The stronger lineup with the addition of the new small car gives Honda the expectation of increasing that to 90,000 units.Inside Line says: The new small car gives Honda a significant lead over its competitors in Thailand. — Tony Pugliese, Correspondent