Updated: July 17, 2009 12:00 AM | By Yuri Kageyama, THE ASSOCIATED PRESS, cp.org

Toyota making hybrids in UK, Honda brings back overtime at Japan plant



TOKYO - Toyota said Friday it will start making hybrids in Europe next year, while its Japanese rival Honda is bringing back overtime to meet demand for small cars, underlining the potential of their green vehicle strategies to underpin recovery from the auto slump.

As part of a growth strategy that hinges on its strength in hybrid technology, Toyota Motor Corp. said it will produce a gas-electric hybrid version of its Auris hatchback from mid-2010 at its Burnaston Plant in central England. It didn't give any production figures.

The world's top automaker already makes hybrids in North America, Japan and China. It has been eager to expand its business in Europe, where it's still a tiny player.

Toyota said the decision to start making the hybrid Auris underlines its determination to "distinguish itself in that market through the strengths of its hybrid technology" as it fights the global auto slump.

Honda Motor Co. is stepping up production and bringing back overtime at its Japanese plants, having workers come in on weekends at its Saitama plant for the first time since the financial crisis.

It will start with one day in July, but is adding another extra work day in August, and two days each in September and October, said company spokesman Hiroyuki Horiuchi.

The Saitama plant, in a Tokyo suburb, is returning to a double-shift at one of its two assembly lines in August, because of the solid demand in Japan for the Freed hatchback, boosting production there to 1,450 vehicles a day from 1,100, according to Japan's No. 2 automaker.

Honda is also having workers do overtime at another Japanese plant, in Suzuka, which makes the hit Insight hybrid, as well as the Fit subcompact.

The latest move underlines signs of a gradual recovery at Honda, which has been riding out the slump relatively better than its bigger rival Toyota.

Strong hybrid sales, meanwhile, have furnished the one bright spot in Toyota's gloomy performance. The maker of the Prius hybrid and Lexus luxury car sank to its worst ever loss in the fiscal year ended March.

Government incentives to encourage the purchase of ecological vehicles have helped boost sales of hybrids and small vehicles.

The remodeled Prius has been selling briskly in Japan since they went on sale in May, and has been the top selling car in Japan for two straight months.

Sales of Honda's Insight hybrid and smaller Freed and Fit models are also doing well.

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