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Friday, November 21, 2008, 12:05
Japanese car giant Honda will cease production at its huge Swindon manufacturing plant throughout February and March with the vast majority of its 4,800 workforce being laid off.
Only associates - as Honda calls its workers – that are not directly involved in making cars will continue to work at the South Marston complex, such as accountants and human resources staff.
The rest will stay at home and receive basic pay, without over-time payments and shift premiums, a Swindon-based Honda spokesman told the Western Daily Press.
But last night Kenneth Keir, managing director of Honda UK, said the future of the company's Swindon plant was "not in doubt".
"Honda remains totally committed to our factory in Swindon," he told BBC Radio 4's The World At One.
"It is the major European manufacturing base of our business."
It is the latest car-maker to scale back production in the wake of the economic downturn, following previous announcements affecting production including the Mini, Nissan and Land Rover.
And it was the second blow to Swindon car workers this month after 1,000 staff at BMW, which makes body panels for Mini cars, were told that the Christmas shutdown would be extended to four weeks.
Swindon's largest private employer, Honda already planned to have 13 non-production days at the factory in February.
But due to increasingly gloomy out-look it has decided to extend the cutback and will also scale back car-making at two plants in Japan and the United States.
The company stressed that it had no plans for redundancies at Swindon but the unprecedented decision to suspend production for 29 days raised the spectre of possible job losses in the future.
A senior member of staff at Swindon – who asked not to named – told the Daily Press: "Our associates are obviously worried. But they also realise that the company is doing everything that it can to protect jobs in these difficult times."
However, the move was quickly denounced by unions, which will now seek emergency talks with the company.
Roger Madison, national organiser at Amicus, part of the Unite union, said: "We're really worried about jobs at Honda. We don't want job losses but we don't want lay offs either.
"Honda hasn't got an agreement where people are paid when there's no work. We don't know all the details but it's a really bad day. We're here to project jobs but we're also here to protect money."
Union officials expressed the belief that Honda seriously considered making 1,300 people redundant but instead opted for a temporary cessation of production.
The plant produces the Civic and CR-V models which are sold throughout Europe and is due to start production of the small car Jazz next autumn.
It is understood that Honda was desperate to keep its highly trained Swindon workforce intact in readiness for the new car.
The decision to make a two month break in production had been taken because demand for cars had dropped across Europe and in Russia, Mr Keir said.
It would allow the company to plan for next year's market conditions, which he predicted would "not be any better" than at present.
"We believe that this stop for two months will put our business plan in a position where the marketplace through next year – which we see will at best be stable from where it is now – will put us in the position where the demand will be there for our vehicles," Mr Keir added.
Asked about the possibility of a Government bail-out for the car industry, Mr Keir said it was Honda's policy not to accept handouts.
He also said the break in production would ensure customers were not buying "old cars".
"We chose to make it very clean, and rather than necessarily just reducing the line rate, to stop production," Mr Keir said.
"One of the major reasons for that would be that as a clear focus of our business we want our customers to have fresh cars and therefore when we start again in April, obviously we won't be delivering two or three month old cars."
Honda came to Swindon after acquiring 370-acres of the former Vickers airfield at South Marston in 1985.
In November last year Honda workers celebrated the production of their one millionth car at Swindon.
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