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posted by martyb on Tuesday February 19 2019, @06:49PM   Printer-friendly
from the civic-minded? dept.

Honda Confirms Plan to Leave Britain as Brexit Looms

The Japanese automaker Honda has become the latest business to make plans to leave Britain as global forces reshape the car industry and the country prepares to exit the European Union.

Honda will close its plant in Swindon, England, which employs 3,500 workers, by 2021, it confirmed on Tuesday. The factory, which produces about 150,000 cars a year, will close once its current line of Civic cars comes to an end.

"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," Katsushi Inoue, the chief officer for European operations, said in a statement.

The decision was a "devastating decision for Swindon and the U.K.," Greg Clark, Britain's business secretary, said in a statement. "The news is a particularly bitter blow to the thousands of skilled and dedicated staff who work at the factory, their families and all of those employed in the supply chain," Mr. Clark said, adding that he would convene a "task force" to keep the employees in work.

Also at CNN.


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  • (Score: 5, Insightful) by zocalo on Tuesday February 19 2019, @09:58PM (2 children)

    by zocalo (302) on Tuesday February 19 2019, @09:58PM (#803695)
    It's a bit more complex than that, something even Honda acknowledged in their official statement; the EU just signed a trade deal with Japan removing tariffs from Japanese car imports (amongst other things). This is what allows Honda (and potentially Nissan and Toyota too, I guess) to relocate their manufacturing back to Japan without having to incur import duties. However, since the UK is leaving the EU and may not have a similar arrangement in place, they *might* end up paying duty for cars manufactured in the UK that they want to export to Europe. That gives us two possible financial sums for Honda:

    Costs of relocating manufacturing back to Japan + higher costs of transportation of cars to Europe.
    Lower costs of transportation of cars from UK to Europe, but potential for significant import duties in the event of an increasingly likely no-deal Brexit, WTO scenario.

    Pretty obvious the former is the lower risk, especially if they were looking at consolidation anyway (viz. closing their plant in Turkey as well). Of course, if the UK were not leaving the EU, they might have come to a different conclusion since that would entail zero cost of relocation *and* zero import duty, which is an even more financially sound decision than either of the two options effectively left on the table.
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  • (Score: 1) by Sulla on Tuesday February 19 2019, @11:14PM (1 child)

    by Sulla (5173) on Tuesday February 19 2019, @11:14PM (#803746) Journal

    In regards to Toyota it seems they are focusing more vehicle production in the US. Fukushima caused them to lose a large portion of their battery production for their Lexus hybrids, so they moved the facilities to the US rather than rebuild in Japan. This is probably a Toyota only thing because they already have a huge manufacturing base here in the US, but I wonder how this could effect Toyota manufacturing in the EU.

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    • (Score: 0) by Anonymous Coward on Wednesday February 20 2019, @02:51AM

      by Anonymous Coward on Wednesday February 20 2019, @02:51AM (#803823)

      Also they probably will not abandon the factory. They will sell it.