Honda is closing its only manufacturing plant in Britain, killing 3,500 jobs.
As much as we love the new Honda Civic and especially the Type-R hot hatchback, it hasn’t been enough to keep Honda from sliding as a carmaker. As emissions grow ever more stringent across Europe and the rest of the world, Honda is at risk of becoming Japan’s dinosaur while Toyota and Nissan forge ahead with new electric powertrains.
Honda announced the closure of their Sayama plant in October of 2017, blaming a shrinking domestic market at the time. Now, Honda CEO Takahiro Hachigo has announced that they’ll be closing their only plant in Britain due to struggling European sales.
Honda’s Swindon assembly plant built 160,000 Civics last year and employs roughly 3,500 people. However, Reuters estimates that as many as 10,000 jobs could be affected as the plant’s closure ripples throughout the automotive supply chain.
“We had to consider the rise of electrified vehicles and the different speeds at which electric vehicles will be taken up in North America and Europe,” said Hachigo from a news conference in Tokyo.
Honda has lagged behind rival carmakers in adopting electrified powertrains and is struggling to find traction, especially in Europe. The continent accounts for just 3% of all Honda cars sold throughout the world, and Honda enjoys a mere 1% market share across Europe.
Complicating matters is a British parliament that is struggling to agree on a deal with European Union legislatures to continue free trade but exit the union. However, Hachigo denied that Brexit was a factor in their decision to close the Swindon plant.
“This decision was not informed by Brexit,” he said.
Be that as it may, a no-deal Brexit would be devastating for Japanese carmakers in Britain, which currently enjoys free-trade with the rest of Europe. Import/export tariffs on British-made vehicles would encourage Nissan, Toyota, and Honda to make their cars inside the EU where tariffs can be minimized.
Roughly half of all vehicles made in Britain are Nissans, Toyotas, or Hondas.