Honda confirms Swindon car plant closure

Honda has confirmed it plans to close its factory in Swindon in 2021 with the loss of 3,500 jobs.

The Japanese car giant said the decision - first reported a day earlier by Sky News - was in response to "unprecedented changes in the global automotive industry".

Business secretary Greg Clark said it was a "particularly bitter blow to the thousands of skilled and dedicated staff who work at the factory" as well as their families and many others working for the factory's suppliers who will be affected.

Honda said the announcement was not driven by Brexit - but it comes weeks ahead of a possible no-deal departure from the European Union.

The company has previously said such an outcome would cost it tens of millions of pounds.

Brexit has created major uncertainty for carmakers who rely on just-in-time supply chains, adding to headaches created by a China-led world economic slowdown and the sharp decline in popularity of diesel vehicles.

Meanwhile, a new Japan-EU trade deal means Japanese firms can now enjoy frictionless trade with Europe without having to locate there, meaning it may make more business sense to relocate to its home market.

Honda produced more than 160,000 cars in Swindon last year, where it first set up a base in 1985 and now makes its Civic model.

The plant exports 85% of the vehicles, with the bulk of them going to North America and 20% of those made being sold to Europe.

But it said it was revising its global manufacturing operations amid the "significant challenges" involved in the transition to electric vehicles and that it would "focus activity in regions where it expects to have high production volumes".

It said under this restructuring, Honda UK's role as a global manufacturing hub "may no longer be viable".

Mr Clark said: "As Honda have said, this is a commercial decision based on unprecedented changes in the global market. Regardless, this is a devastating decision for Swindon and the UK."

Katsushi Inoue, president of Honda Motor Europe, said: "In light of the unprecedented changes that are affecting our industry, it is vital that we accelerate our electrification strategy and restructure our global operations accordingly.

"As a result, we have had to take this difficult decision to consult our workforce on how we might prepare our manufacturing network for the future.

"This has not been taken lightly and we deeply regret how unsettling today's announcement will be for our people."

Honda said its European headquarters, focused on serving customers, would continue to be based in Bracknell.

The decision comes weeks after fellow Japanese carmaker Nissan also dealt a major blow to the UK when it said it had cancelled plans to build its X-Trail at its Sunderland factory.

Des quinn, Unite's national officer for the automotive sector, said: "We acknowledge the global challenges that Honda has outlined in its statement, but we don't accept that this plant, with its highly skilled and dedicated workforce, does not have a viable future."

The union is now entering consultation with the company and Mr Quinn said it would "leave no stone unturned to keep this plant going and its workforce in employment".

He added: "While Brexit is not mentioned by the company as a reason for the announcement, we believe that the uncertainty that the Tory government has created by its inept and rigid handling of the Brexit negotiations lurks in the background."