Honda to cease production at its Swindon factory in 2021

Thursday, 21 Feb, 2019

Labour leader Jeremy Corbyn said it is a "huge blow" to workers and the wider community, adding: "The Government's disastrous handling of Brexit is letting people down across the country".

"Robert Buckland [of Swindon South] and I will be doing everything to support the hard-working, loyal and skilled workers at Honda and the supply chain through the Gov taskforce as we deal with this devastating news".

The plant closure will boost Honda's operating profit by more than ¥30 billion (Dh995.2m) annually from 2023, according to an estimate by Koichi Sugimoto, an analyst at MUFJ Morgan Stanley in Tokyo.

Should the Civic hatchback and Type R relocate to North America, two plants seem like likely candidates. Overall production numbers at the factory in 2018 - which includes both the Civic and the recently departed CR-V - were 160,000 which is around 10 percent of Britain's overall vehicle production.

Clark said that while Honda's decision was made for "commercial" reasons, it was nonetheless "devastating. for Swindon and the UK".

The UK has always been a Japanese hub for European auto production, with Honda, Nissan Motor Co and Toyota Motor Corp owning three of the country's six largest automaking factories.

After nearly five years of negotiations, the European Parliament ratified the EU-Japan trade deal on Wednesday (12 December), sealing the biggest ever trade agreement negotiated by the European Union.

The EU-Japan Economic Partnership Agreement (EPA), which came into force on 1 February, substantially lowers trade barriers between the EU and Japanese economies and, more critically, essentially eliminates tariffs on vehicle exports from Japan to the EU. If Britain leaves the European Union, it could cause serious issues with companies that reside in the country but export to other countries.

Honda makes its popular Civic model at the factory in Swindon, 115km west of London, with an output of 150,000 cars per year.

Hachigo said the trade pact will improve the competitiveness of Japanese exports in the European market.

The UK industry has already been battling Brexit-related slowdown, potential tariffs and supply bottlenecks ahead of the exit from the trade bloc on March 29.

The automotive sector in the United Kingdom is now facing several challenges, with major manufacturers including as Jaguar Land Rover, Ford, Toyota, Nissan and BMW warning about the impact of a no-deal Brexit. PSA Group's Vauxhall Ellesmere Port site is in doubt as it mulls plans for the next Astra.

Mr Clark reeled off comments including from Ford, Aston Martin and Toyota, adding: 'I could go on, the clear message from the automotive companies is that we should get on and ratify this deal'.

Lord Sugar blames Sunderland's Brexit vote for Honda's decision to close its Swindon factory.

"Honda released a statement saying that the closure was due to a pivot towards electrified cars and a focus on 'regions where it expects to have high production volumes".