Will Honda Say Sayonara to the UK?
The rumour mill is in full force in the UK as Honda is said to be set to announce the closure of its Swindon car plant in 2022. This will result in the loss of about 3,500 jobs at the plant itself.
Honda has been building cars in the UK for about 30 years, in a town probably more famous for building steam trains in the southwest of the country. Last year, they put together about 160,000 Civics alone, of which 90% were exported to the EU. The closure of this plant will ultimately mean an end to Honda car production in the UK.
No formal announcement has been made yet but the rumour was confirmed by local MP Justin Tomlinson, who confirmed consultation with all staff had begun. Of course, everyone has been quick to blame the ongoing Brexit fiasco, sorry, negotiations. But there is also the underlying collapse in demand for smaller cars as the SUV craze takes the world by storm.
The plant also produces engines, one of which is the i-DTEC diesel engine, and, of course, diesel power has been steadily falling out of favour across Europe due to the associated high emissions it produces. The sad fact is the factory was only working at half capacity and even though Japanese companies are generally long-term investors, this would have inevitably been a strike against it.
Probably the most damaging event, though, was the signing of an EU-Japan trade deal struck recently that allows tariff-free import/export of cars between the two trading partners. This will allow cars produced in Japan to be freely exported to the whole of Europe and thus the need for local factories will be negated. Nissan has already announced that the new X-Trail, a car built in Sunderland for the European market, will now be built back in Japan as the need for a UK or European factory dwindles.
The Swindon plant initially opened in 1985 when Honda established a predelivery inspection plant. In 1989, an engine manufacturing plant was added and shortly after this in 1992, it began producing the Honda Accord at the facility. Since this time, the Jazz, CR-V and Type R have been produced there along with the Civic. Since 2001, Honda has had the capacity to put together 250,000 cars a year in Swindon, so this loss will be a bit of a body blow to the UK car manufacturing industry. Sayonara indeed.