Honda workers return after four-month shut down

Thousands of car workers returned to the production line at one of the UK's biggest plants today after a four-month shut down.

The Honda factory in Swindon, Wiltshire, resumed business this morning but the 3,400 workers and management staff returned to the factory for lower wages and will be producing far fewer cars this year.

During the shut down 1,300 workers took the company's offer of voluntary redundancy. The employees still at Swindon have agreed to a 3 per cent pay cut for the next 10 months while managers are having pay reduced by 5 per cent in the face of a big downturn in new car sales. And around 400 people who returned to work have been given new roles or training as their jobs no longer exist.

Staff got full pay for the first two months of the shut down and around 60 per cent for the last two months. With production halted Honda has spruced up the Swindon plant, stripping and rebuilding assembly lines and redecorating throughout.

New robots and machinery have been brought in to prepare for the new Honda Jazz Supermini which will start production at Swindon in September.

Director of Planning and Business Administration David Hodgetts was positive today about Honda's future. He said by the end of the month they hope to produce 600 cars a day. "There was scepticism that we would reopen today so we are very happy that we have returned to work and that the overall climate is as we expected and has allowed us to reduce our stock levels," he said. "We have halved our production to match sales and we will gradually increase over the next few months so we are confident for the future. This has got to be seen as a good sign from an economic point of view; it does not mean the end of the recession but it means that things have stabilised and we can go forward with our plans."

During the shutdown employees said they had been spending time with their families, taking other paid employment or doing community voluntary work.

Paul Wiseman, 33, who works in the engine department, said: "We all understood the shutdown had to happen and we think it was a good idea.

"I'm pleased to be back at work and back into a routine. I have painted and decorated the whole house and kept the wife happy by doing all those jobs I never got around to doing.

"There are people who took the redundancy money and are still out of work. At least we have a job."

Paul North, 38, an engine floating operator, said: "Taking a 3 per cent pay cut is not a big deal, it could have been worse. In Japan they are having to take 10 per cent. Nobody wants to lose their jobs so if this safeguards jobs then we have to go with it.

"Everybody is glad to be back because four months off is a long time and there's only so much golf you can play. I think the new Jazz will be the making of Honda and of Swindon because people are going to buy the smaller cars during the recession."

Honda had hoped to produce 228,000 vehicles at Swindon this year. Last November this figure was reduced to 175,000 when it was decided that production would stop in February and March. In mid-January, Honda said the shutdown would last through April and May as well, and the 2009 production figure has now been set at just under 113,000.

Honda new car sales in the UK dipped more than 16 per cent in April 2009 compared with April 2008 and sales for the first four months of this year are down more than 34 per cent.

The restart of production comes at a time when there is a glimmer of hope amid the motor industry gloom.

Last week, the government announced that the "cash for bangers" car scrappage scheme had been an initial success, with 35,000 new cars being ordered since the initiative was first announced on April 22. Nationally, new car sales have fallen 28.5 per cent in the first four months of this year. But it is possible that the scrappage scheme could, at the very least, halt the rate of decline.