The closure of the Swindon plant, 70 miles (115 kilometers) west of London, is set to take place in 2022, according to the BBC. The company made 199,000 Honda Civics in Swindon last year, of which nearly 90 percent were exported to the EU.
Honda has not made a formal announcement on the closure, and a spokesperson for Prime Minister Theresa May said she would not comment until there is an official confirmation.
The information on the plant closure came from local lawmaker Justin Tomlinson who said he had spoken to Honda, which confirmed it was consulting with “all staff,” reports CTV News Canada.
Honda: RobertBuckland & I have already spoken to the Business Secretary & Honda. They are clear this is based on global trends and not Brexit as all European market production will consolidate in Japan in 2021.
— Justin Tomlinson MP (@JustinTomlinson) February 18, 2019
Tomlinson said the decision “is based on global trends and not Brexit as all European market production will consolidate in Japan in 2021. There is not expected to be any job losses, or changes in production until 2021.”
In an emailed statement to CNBC on Monday, Honda said: “At this point, we are not able to make any comments regarding the speculation. We take our responsibilities to our associates very seriously and will always communicate any significant news with them first
A negative effect on auto workers
Unite Union said if confirmed, the closure of the plant would be a “shattering body blow.” And the news comes at a time when businesses are warning of the damage being created by the uncertainty around Britain’s looming exit from the European Union. The UK is set to leave the EU on March 29 but nothing has been worked out on the divorce.
National officer Des Quinn said: “The car industry in the UK over the last two decades has been the jewel in the crown for the manufacturing sector – and now it has been brought low by the chaotic Brexit uncertainty created by the rigid approach adopted by prime minister Theresa May.”
While Honda, according to Tomlinson, says the move is based on “global trends,” it is not the only automaker that has become leary of the Brexit pullout. Earlier this month, Japan’s Nissan announced that it would not build a new SUV at its plant in Sunderland, England, citing “business reasons.”
Nissan did add that “the continued uncertainty around the U.K.’s future relationship with the EU is not helping companies like ours to plan for the future.”
Last week, Ford said if the UK left the EU, it would be “catastrophic for the U.K. auto industry and Ford’s manufacturing operations in the country.”
Christian Stadler, professor of strategic management at Warwick Business School was quoted by the Associated Press. Stadler said automakers are going to be hit with several issues, including a cooling global economy and a European crackdown on diesel engines.
“Add the fact that the supply chain for most British-made cars crosses the Channel several times as parts are shipped back and forth, so any delays at the border after Brexit could severely disrupt the industry’s ‘just in time’ production method, and the U.K. starts to look like a less attractive place for international companies to build cars,” he said.
