GREENSBURG, Ind. -- Honda Motor Corp. will build Civics at its new $550 million vehicle assembly plant in southeastern Indiana, a company official said at a ceremonial groundbreaking Monday.

The Japanese automaker has said the plant will employ about 2,000 people when it opens in fall 2008.

Koichi Kondo, president and CEO of American Honda, confirmed the factory will build the sedans, a staple of the car company. During a steady downpour, with thunder and lightning for a backdrop, he told about 200 people inside a heated tent that the Civic is "the right vehicle for this plant."

"Building the Civic is a big responsibility," he said at the ceremony that Gov. Mitch Daniels also attended. "That should tell you how confident we are in the people of Indiana."

Honda announced the factory site last year, and earth movers started reshaping the area in October, with construction starting soon after.

"We are so proud we are here, we decided to put the name of this great state in the name of our new company," Kondo said. "From this day forward, the new company we're establishing here is going to be known as Honda Manufacturing of Indiana."

Earlier this month, a Honda supplier announced that it will build a $32 million factory north of Greensburg, outside New Castle, to make car seats for the plant.

The factory -- part of a $1.18 billion global expansion -- eventually will produce 200,000 vehicles annually, increasing Honda's North American production to 1.6 million a year.

The jobs that pay an average of $24 an hour promise an economic boost to the region. Economists estimate that each new Honda job could result in six others that will serve the plant and workers.

In 2005, American Honda sold 1.5 million Honda and Acura cars and light trucks, and the continent accounts for about half Honda's annual global sales, the company said.

Four other states -- Ohio, Michigan, Wisconsin and Illinois -- vied for the plant and its jobs after Honda announced in May it would build a plant in the Midwest.

But Indiana, which has lost 98,000 industrial jobs since 2000, persuaded the company to build the plant west of Greensburg, a community of 10,500 people 50 miles southeast of Indianapolis.