would not have invested so much in the UK if it had foreseen that the value of
the euro would decline so much, the BBC says, citing reports on Wednesday (22/11/00).
Honda reportedly said that, if it was making the decision today, it would not
build a new manufacturing plant in Britain because of the weakness of the euro,
the single currency which the UK so far has not joined.
The BBC cited reports saying that the 30% decline in the euro#;s value
against the pound in under two years has cost the Japanese car maker 30 billion
yen ($US 300 million).
The euro#;s plunging value contributed to the 18.5 billion yen ($US 119
million) loss posted by Honda’s European operations for the six months to the
end of September.
Honda does not now expect its European divisions to return to profit until
2003, a year later than previously forecast.
And, despite the launch of the completely revise Civic range this year, the
company expects its European car sales to fall 17% to 208,000 this fiscal year.
The BBC quotes Honda Europe president Minoru Harada as saying that the high
pound was “threatening” all UK-based manufacturing companies.