Honda to halt production for two months

Car giant Honda is to halt production at its UK plant for two months next year in the wake of the "dramatic change" in the global market, the firm announced today.

The plant at Swindon will not produce any cars next February and March, although none of the 4,800 workers will be laid off.

The Japanese firm is the latest carmaker to scale back production because of the economic downturn, following previous announcements affecting production of cars including the Mini, Nissan and Land Rover models.

Honda had already planned to have 13 non-production days at Swindon next February but has decided to extend the cutback and will also scale back carmaking at two plants in Japan and the United States.

A company spokesman said there would no redundancies at Swindon and workers would still be paid. The plant produces the Civic and CR-V models and is due to start production of the small car Jazz next autumn.

The spokesman said Honda wanted to keep the workforce intact in readiness for the new car.

The company said in a statement: "Honda today announced a plan to adjust automobile production at its UK factory in Swindon for the current fiscal year in response to a dramatic change in the global automobile market.

"In addition to 32,000 units production adjustment between December 2008 and March 2009 that had previously been announced, production at Honda of the UK Manufacturing Ltd (HUM) will be further adjusted by 21,000 units.

"This will be achieved by suspending production for 29 days during the months of February and March 2009, combined with 13 non-production days previously planned in this period. Therefore HUM will stop all vehicle production in February and March 2009. There are no plans for redundancies."

Honda said it was reducing car production at Swindon in the current financial year from an originally announced 228,000 units to 175,000 units.

Meanwhile new figures today showed that car production fell by 25 per cent in the UK last month, the lowest level since 1991, while commercial vehicle building slumped by 41 per cent.

The Society of Motor Manufacturers and Traders predicted further reductions in the coming months as firms scaled back production in response to falling demand for new cars.

Chief executive Paul Everitt said: "The October production figures reflect the rapid reduction in global demand for motor vehicles and we expect to see further reductions in factory output in November and December.

"The figures are evidence of the scale of the challenge facing the industry and underline the need for prompt action in next week's pre-budget report to assist the sector during this difficult period."

The SMMT and unions have urged the Government to take urgent action to help motor manufacturers through the current downturn, described as a "crisis" by some in the industry.

Previous figures from the SMMT showed that new car sales fell by 23 per cent last month compared with October last year, the worst year-on-year monthly drop since 1991.