Honda of the UK Manufacturing has this afternoon (13 May) informed employees it has confirmed earlier announced plans to close its English manufacturing plant in Swindon, Wiltshire, at the end of the current model's production lifecycle, in 2021.
The plant currently employs around 3,500 people.
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"Following a meaningful and robust consultation process, which included contributions from collective consultation groups, the UK government and external consultants engaged by [auto workers union] Unite, Honda has reached the conclusion that no viable alternatives to the proposed closure of the Swindon plant have been identified," the automaker's UK unit said in a statement.
"The decision to close the plant is part of Honda's broader global strategy in response to changes to the automotive industry. As previously communicated in February, Honda is accelerating its electrification plans, and as a result resources, capabilities and production systems for electrified vehicles will be focused in regions with a high volume of customer demand."
Last week, following a set of full fiscal year financial results that show profits dragged down by restructuring costs and unfavourable currency effects, albeit with a more positive forecast of a 6% operating profit rise this year, Honda CEO Takahiro Hachigo expanded on the automaker's electrification plan and announced a new model programme which will reduce the total number of trim and option variants of global models to one-third by 2025 compared to now. Honda would increase efficiency by eliminating and consolidating some similar regional models into "even more competent models shared across multiple regions".
With an EU-Japan free trade agreement now in place, the advantages of duty-free trading for the Swindon plant ends and Honda has indicated it plans to bring back to Japan some production presently done overseas where new market conditions make sense to do so.
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By GlobalDataHonda UK said today's announcement to workers "concludes the first phase of the collective consultation process. The second phase – which includes agreeing associate redundancy packages and identifying the impact on individual roles up until production ceases in 2021 – will begin immediately.
"Honda will also intensify its engagement with the Swindon Task Force set up by Secretary [minister] of State Greg Clark, in order to work with government and a broad range of stakeholders to mitigate the impact of this decision on the wider community."
Honda of the UK Manufacturing (HUK) director, Jason Smith, said: "It is with a heavy heart that today we confirm the closure of Honda's factory in Swindon. We understand the impact this decision has on our associates, suppliers and the wider community. We are committed to continuing to support them throughout the next phases of the consultation process."
Last March, rival BMW, reportedly considering more car production in the UK, was said to be in talks to take over Honda's factory in 2021. British magazine Autocar said at the time BMW's Mini plant at Oxford was understood to be at capacity of 1,100 cars a day with more assembly contracted out to VDL Nedcar in the Netherlands which built over 200,000 vehicles in 2018.
