UK Honda Plant Closure ‘A Devastating Decision,’ Says Minister

Honda Factory stock

Jobs losses are not expected to hit until 2021

The firm blamed "unprecedented changes in the global automotive industry" for the decision but it comes amid investment uncertainty in Britain ahead of the country's departure from the European Union next month.

One employee who has worked at the Honda factory in question for 24 years was interviewed on Tuesday morning, describing the entire Brexit situation as "idiocy of epic proportions".

"It is going to have an impact on suppliers in Wales and that's the analysis we are working on", said Tim Williams from the Welsh Automotive Forum.

"We have made a decision to carry out this production realignment in Europe in light of our efforts to optimize production allocation and production capacity globally as well as accelerating electrification", Hachigo said.

Mr Clark accepted Honda's decision was "not about Brexit".

Honda has global production capacity for 5.4 million vehicles, but it sold only 5.24 million vehicles previous year, giving it a utilization rate around 97 percent.

"We determined that it is hard to enhance our lineup of electrified vehicles in Europe with locally produced products in the region from the perspective of competitiveness", Honda President and CEO Takahiro Hachigo said at a press conference in Tokyo. Honda's Senior VP for Europe spoke to BBC Radio and said, "This is not a Brexit-related issue for us".

Prime Minister Shinzo Abe pleaded against a no-deal Brexit in recent talks with his British and German counterparts, telling Theresa May last month: "We truly hope that a no-deal Brexit will be avoided and in fact this is the. wish of the whole world". "This decision has been made on the basis of... global changes".

Honda says its Swindon vehicle plant will close with the potential loss of some 3500 jobs. Interestingly, though, Honda specifically said production in North America wouldn't start until the next-generation Civic is launched. "The timing of this announcement is based on decisions regarding the production location of the next-gen Civic", Honda spokeswoman Jessica Pawl wrote in an email.

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Lord Sugar spoke out after car-maker Honda's decision to close its auto factory in Swindon, with the loss of 3,500 jobs.

Speaking in September, Ian Howells, senior vice-president of Honda Europe, said the company remained "right behind" its plant in Swindon and was not considering moving out of the United Kingdom after Brexit.

"If the speculation is to be confirmed, 3,500 jobs are at risk", Mr Tomala said.

He denied that Brexit was to blame for the "surprising and shocking news", which he said was down to the firm wanting to take production back to Japan as it develops its electric engines.

"The global restructure will involve Honda's automobile operations in Turkey".

Honda's decision came hot on the heels of Nissan axing production at its Sunderland plant in northeast England.

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. Under the deal, the bloc will axe 10-percent tariffs on cars imported from Japan in 2027.

The treaty makes it easier for Japanese automakers to localize production at home for sale in the European Union, consulting firm LMC Automotive said in a report this month.

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