Car manufacturer, Honda has become the most recent business to prepare to leave Britain as circumstances change and global forces alter the shape of the motor vehicle industry as the country prepares to leave the European Union.
Honda will be closing the doors in their Swindon based plant, just outside of London. The closure is set to take place in 2021 and will result in the loss of 3,500 British jobs. The factory produces an estimated 150,000 cars a year, will close once its current line of Civic cars comes to an end. This is the company’s first ever closure in its 71 year history.
Greg Clarke, Britain’s business secretary mentioned in a statement that the decision was “a devastating decision for Swindon and the U.K”.
Honda has decided to follow other companies that have decided to leave Britain as result of uncertain market conditions. regulation and challenges from financially backed technology companies that are pursuing electric vehicles. Last month, Ford said it was cutting thousands of positions across Europe as emission rules and decreasing demand left quite a dent in its profits. Similarly to Nissan, Honda stands to benefit from a new trade deal between European Union and Japan, which will make it easier for them to produce cars in Japan. Their production lines in Japan will be closer to markets viewed as having greater growth potential, like China and Indonesia.
Honda’s operations in Britain depend heavily on being connected to the European Union. The company had already mentioned it would close its factory temporarily in case no-deal Brexit triggered chaos. About 40% of the components that Honda uses at the Swindon factory come from the European Union. While 35% of its experts are sent to the region, according to the government affairs manager at Honda Motor Europe, Patrick Keating.
Source: The New York Times