The company said the investment was the first part of a multi-phase project to “improve vehicle manufacturing flexibility, strengthen the logistics efficiency for future models and prepare for future technologies”.
Construction is expected to be completed in 2018.
The Lincoln plant currently builds four different light truck products, namely the Honda Odyssey, Pilot, Ridgeline, and the Acura MDX. It also manufactures the V-6 engines that power each vehicle.
In total the $2.2 billion facility has capacity to produce 340,000 vehicles and engines a year.
The latest move brings Honda’s total investment in Alabama to over $750m.
“In 2016, more than 68% of all Honda and Acura automobiles sold in the US were made in America, more than any other major automaker except one,” said the company in a statement.