And if it was any other industry I'd agree that it was a significant factor - but the auto industry has been making these threats a long time before 2016.
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Honda set to close Swindon (UK) car plant
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And if it was any other industry I'd agree that it was a significant factor - but the auto industry has been making these threats a long time before 2016.
Closing in 2022 means they are planning a new Civic model for 2022, and all the investment in machinery, training, supply chain, you name it, is being planned and will be performed somewhere else from now on. The factory is most probably closing now, even if Brexit was stopped.
OP
OP
It's worth noting that this is from a month ago, before Honda announced this closure.
It's an extremely competitive, pretty low margin industry which bizarrely still a lot of brand loyalty, they're always looking for an excuse cut costs. Brexit gives them an out, and frankly the whole reason the UK has so many car makers is because of the combined European market.
There are a bunch of different factors at play here: dieselgate and the decline of the ICE, brand saturation, falling demand but the uncertainty from Brexit doesn't help and ultimately if the EU/JPN trade deal means that it's cheaper to take the hit on transportation costs to ship from Japan than absorb a potential 10% tariff from UK (excluding increased supply chain costs) then they'll use that as an excuse and it won't be a totally invalid one.
Production is ending 2021, the closure normally takes another 6 months of that. There will be a new Civic in 2021 probably (the most recent one came to market in 2016 and Honda tend not to let Civic's go 5 years without a refresh)
Even if they were already thinking of leaving i'd call Brexit the final nail on the coffin rather than an excuse.
Given that a) Manufacturing in the UK is going to become even more expensive and b) Japan and the EU have an FTA, which might make it viable that they don't even need an EU plant anymore.
The FTA is probably an even bigger reason than "just" the UK leaving.
What deal? There is no deal, why do they still not get this. All May has is a withdrawal agreement which is a holding pattern till a real deal is made(which will probably never happen with the way the UK has behaved in these negotiations, which means the UK will slowly be circling the drain, a long slow and bumpy decline).
Brexiters:
"This is project fear"
"It's not definitely happening yet"
"This has nothing to do with Brexit"
"This is project fear"
"It's not definitely happening yet"
"This has nothing to do with Brexit"
Well, I ain't no expert in the car industry, but that only points more to Swindon not having a long future building Civics.
Yeap. That's why they're not relocating to the EU and instead expanding production back home and benefit from the new EU-Japan trade deal. Without Brexit they would be tempted to do this. With Brexit there's pretty much no reason NOT to do it-
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Did you read the summary? It seems they gimp Europe sales anyway, and are a bit of a nobody in the overall European market sales wise...
HOWEVER...
This does not negate the massive blow this will cause to Swindon itself and the ancillary businesses that support the company.
The site in Malmesbury isn't closing, in fact it's being expanded.
(And please don't - I've lived in Malmesbury, I know exactly where the factory is...)
These companies couldn't care less about saving face or public opinion lol
They care about money.
VW sold a record number of cars in 2018, even after diesel gate - the biggest "fuck you" to automotive consumers in the last decades.
These companies don't give a shit shit about anything else then selling more cars and making profit - Honda would not have kept a plant alive if it wasn't worth it - they don't give a shit about some couple thousand workers. This move will not impact Civic sales in any meaningful way.
http://data.parliament.uk/writtenev...for-the-automotive-industry/written/71644.pdf
The factory had already refocused to global markets i.e the supposed entire point of Brexit economically, but it's supply chain was still exposed to the costs of Brexit. Ergo the plant is now uncompetitive. It's easier for Honda just to move to existing facilities (outside the EU) and eat the transport costs.
This isn't news - again, largely down to Honda's strategy in the EU market. The Swindon plant has been under manufacturing for several years, due to the unpopularity of the Civic outside of the EU and US, which by coincidence the current model's lifespan runs out in..... yes, you guessed it 2021!
It would be more factual to suggest the decision to build the next generation model of the Civic in Japan was the final nail in the coffin for the plant.
PS: Any potential future tariff charges aren't putting Porsche off.
PPS: It's also not putting BMW off - who've just had planning permission for a new Manufacturing base (to build Mini's). I'll let you figure out where....
https://pa1.swindon.gov.uk/publicaccess/applicationDetails.do?activeTab=dates&keyVal=PDK9U5PTI0700
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i really have to ask some brits here on the forums. is it true? would people risk getting jobless for brexit?
They don't believe there will be job losses. Any job losses that happen would have happened anyway and have nothing to do with brexit.
They're delusional.
54.7% in Swindon voted to Leave.
Of the Honda Civics made there, 90% were exported to the EU. Maybe this plant would be closing by 2021 anyway, but I doubt it would be closing this soon if not for Brexit.
The management failed to secure the contract to make the next version of the Civic. Shimples.
Hmmm, I wonder why?
Proud managers describe 2m components "flowing like water" to the factory line every working day. Some orders from EU suppliers arrive within five to 24 hours; others, such as customised car seats, are summoned from local suppliers just 75 minutes before use. Not a minute is wasted.
Honda now fears that the border checks that could be introduced as a result of Brexit will clog up the process. If Britain were to leave the customs union, Honda estimates European parts will take a minimum of two to three days to reach the plant, and possibly as long as nine days. Delivery times of finished cars may be just as unpredictable.
To a car industry famed for its clockwork tempo, the potential delays pose an existential challenge. A warehouse capable of holding nine days' worth of Honda stock would need to be roughly 300,000 sq m — one of the largest buildings on earth. Its floorspace would be equivalent to 42 football pitches, almost three times Amazon's main US distribution centre. And its cost to operate would be as eye-catching as its proportions.
https://www.cnbc.com/2018/06/27/honda-faces-the-real-cost-of-brexit-in-a-former-spitfire-plant.html
"From an administrative point of view, we'd probably be looking at 60,000-odd additional bits of documentation we'd have to provide to get product to and from Europe"
"If we end up with WTO tariffs, we'd have something like 10% of costs in addition on products shipped back into Europe and that would certainly run into tens of millions. And likewise, when we're looking at components coming the other way, again tens of millions in tariffs potentially coming into the UK.
"That impacts our productivity, certainly in terms of the flow of product, but also it does hit potentially our competitiveness. Of course if we are shipping and competing against a European manufacturer in Europe, they're not incurring those tariffs."
https://www.theguardian.com/business/2018/sep/18/honda-no-deal-brexit-tariffs-swindon
But we already seeing a lot of closures and relocations to the eu. These are real jobs that are being destroyed here.
The reactions to all of these stories is either it would have happened any way or it will just be replaced by something British so it will be better ultimately. It's all delusional, certain tabloids and news channels refuse to say a bad word about Brexit and it is eaten up by a large amount of the population.
Honda is centralising its ENTIRE EU manufacturing operations in Japan, so the plant in Turkey is also closing. I'm not sure about the logistics factory in Belgium which provides parts, but this constant hyuck hyucking over Brexit is getting tiresome.
I also think Farage is a cunt, btw.
"They're just leaving because they're greedy and don't have faith in our Great Britain"
Because... (come on your almost there) ... 40% of their supply chain and 35% of the market has increased associated costs due to Brexit. The plant is more uncompetitive than it would have been. The Turkish plant is small only and produces 50k vehicles per year, which means it's probably closing (along with the logistics hub Belgium (although I imagine that'll be downsized as parts base for onward servicing) because 50k vehicles isn't a big enough EU production base to continue with the EU operation especially with EU/JPN.
Now maybe the EU/JPN deal means that Swindon would have been noncompetitive anyway (although given the cost of labour in JPN and shipping costs, I'd be surprised)
can't blame them to be honest.
i wish i could abandon this country. Leavers have ruined it and it's going to get much worse.
i wish i could abandon this country. Leavers have ruined it and it's going to get much worse.
PR:
And here's an excellent thread about what went down. And why Toyota may be the next in line:
Swindon was not profitable, but Honda is closure-adverse and was trying its best to keep it running. Closing a factory sours relationships with public, politicians and suppliers, and it's just awful PR that lasts for many, many years. Besides, there are a number of intangible benefits from having local production that may offset small, manageable losses.
Brexit basically made those losses and headaches not worth it by hard hitting supply chains and potentially screwing with rules of origin. Leaving the UK at the same time as the trade deal with the EU was signed basically sealed the factory's fate. It's just incredible that the UK lobbyied hard for that deal against France and Germany, as it expected to EXPORT to Japan and boost local production. Brexit took care of that.
One should also understand that those 3500 employees are just the tip of the iceberg. Suppliers, ancillaries and even local businesses propped by them will make that number much, much higher. When a car manufacturer closes down, it takes entire cities and neighbouring towns with it. And leaving the EU will mean an even harder hit. The economy of the region is going to be razed.
Edit: And watch out for Nissan feeling like having a license to take drastic decisions due to the recent executive shake out.
And here's an excellent thread about what went down. And why Toyota may be the next in line:
Swindon was not profitable, but Honda is closure-adverse and was trying its best to keep it running. Closing a factory sours relationships with public, politicians and suppliers, and it's just awful PR that lasts for many, many years. Besides, there are a number of intangible benefits from having local production that may offset small, manageable losses.
Brexit basically made those losses and headaches not worth it by hard hitting supply chains and potentially screwing with rules of origin. Leaving the UK at the same time as the trade deal with the EU was signed basically sealed the factory's fate. It's just incredible that the UK lobbyied hard for that deal against France and Germany, as it expected to EXPORT to Japan and boost local production. Brexit took care of that.
One should also understand that those 3500 employees are just the tip of the iceberg. Suppliers, ancillaries and even local businesses propped by them will make that number much, much higher. When a car manufacturer closes down, it takes entire cities and neighbouring towns with it. And leaving the EU will mean an even harder hit. The economy of the region is going to be razed.
Edit: And watch out for Nissan feeling like having a license to take drastic decisions due to the recent executive shake out.
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