Honda Motor has said it would resume car output at four plants in China on Friday but the outlook for next week remained uncertain as some workers at a parts factory have not yet agreed to a full return to work.
Vehicle production stopped last week after employees at a 1,900-worker wholly owned parts factory in Foshan, Guangdong province, refused to work until their demands for more pay and other conditions were met.
Go deeper with GlobalData
Discover B2B Marketing That Performs
Combine business intelligence and editorial excellence to reach engaged professionals across 36 leading media platforms.
The parts factory resumed full production on Wednesday but some of the workforce agreed to return only until Friday, when they expect Honda to respond to a list of as-yet unmet demands.
“For sure, we will go on strike again if we don’t get a satisfying answer,” a parts worker told Reuters.
Honda had said two assembly plants run by Guangqi Honda, a joint venture with Guangzhou Auto Group’s listed arm, Denway Motors, as well as an exports-only factory that is majority owned by Honda would restart Friday morning.
A separate factory run by Dongfeng Honda, which is partly owned by Dongfeng Motor Group, would resume output Friday afternoon.
Production would continue to the end of Saturday but Honda said the decision of whether to continue factory operations beyond then would depend on the outcome of talks with workers. Sunday is a holiday.
“The problem for Honda is that the transmission plant is wholly foreign-owned,” Zhang Xin, an analyst with Guotai Junan Securities, told the news agency. “If it were a JV, the Chinese side would have stepped in early on and it wouldn’t have gotten as ugly as it is today.”
“Living costs in major Chinese cities are pretty high,” said Zhang, who is based in Beijing. “After Honda and Foxconn, there could be similar disputes, especially in foreign-owned companies.”
Companies have complained that rising production costs in China, especially in the Pearl River Delta, are eating into their profit margins.
