Honda has announced it is to close its Swindon car plant in 2021, leading to the loss of around 3,500 jobs, and threatening many more throughout the supply chain.
The move means Honda has joined Jaguar Land Rover and Nissan in a steadily increasing pre-Brexit exodus.
The plant produced over 160,000 vehicles in 2018, of which 90 per cent were exported to the EU.
Katsushi Inoue, Chief Officer for European Regional Operation for Honda, 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 taken 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.”
Speaking to the BBC, Senior Vice-President for Honda in Europe Ian Howells said: “We’re seeing unprecedented change in the industry on a global scale. We have to move very swiftly to electrification of our vehicles because of demand of our customers and legislation.”
“This is not a Brexit-related issue for is, it’s being made on the global-related changes I’ve spoken about. We’ve always seen Brexit as something we’ll get through, but these changes globally are something we will have to respond to. We deeply regret the impact it will have on the Swindon community.”
Despite Honda’s insistence that the closure is not as a result of Brexit, many have seen the continued uncertainty around it as a key reason for it.
Labour MP Rachel Reeves, Chair of the Business Select Committee, said: “The PM needs to rule out no deal immediately and keep us in the single market and customs union rather than risk further fatal damage to our car industry.”
“Japan and the EU have a free-trade agreement, guaranteeing tariff free access. It would be an act of folly to toss that away, along with friction free access to the EU market, in the forlorn hope that we could negotiate a better deal.”
Honda has also previously voiced concern around the impact of a no-deal Brexit on both its supply chain and cost to the company.
The decision will threaten thousands of jobs across the supply chain, thanks to the “just-in-time” manufacturing process.
Honda estimated last year that every 15 minutes of customs delay would cost it up to £850,000 a year.
Speaking in 2017, Patrick Keating, Honda’s Government Affairs Manager, said: “Outside of the customs union, there is no such thing as a frictionless border. I wouldn’t say that the just-in-time manufacturing model wouldn’t work, but it would certainly be very challenging.”
In reaction to the closure, Des Quinn, Unite Automotive Sector National Officer, 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 Theresa May.”
“We are seeking urgent clarification from Honda on the implications of these serious reports. The 3,500-strong workforce do skilled, well-paid jobs that the UK can ill-afford to loss. If the government had advance warning of this dreadful news and did not alert the unions, this is an appalling and cavalier attitude by ministers.”