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Honda’s Four-Month Production Break Begins

January 31st, 2009
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Honda will close its Swindon factory for four months after today’s (Friday, January 30) shifts are over.

The halt will affect just over 3,000 of the 4,000 employees, who will receive their full basic pay for the first two months, but around 60% thereafter.

The shutdown is thought to be one of the longest in Britain’s recent industrial history.

The move is in response to the downturn in the UK and global car markets.

Honda has said there are no plans for redundancies and that it intends to ‘safeguard employment’ for workers who want to stay at the company.

But it is understood that more than 1,000 staff have signed up for a voluntary severance package and some have already left the business.

When staff return on June 1, they will be making fewer vehicles as production, which was at around 240,000 vehicles a year, will resume at half that level.

Honda, which employs 4,200 people in the UK and exports the Civic to 60 countries worldwide, has also cut 3,100 temporary jobs in Japan and reduced global production by 56,000 vehicles.

Honda says that its net profit for the three months to December plummeted 89%.
The company made a net profit of 20.24 billion yen ($226m; £158m), far lower than the 200bn yen it made in the same period the year before, prompting the company to cut its annual forecast by more than 50%. The group now expects net profit for the year to March 2009 to be 80bn yen, less than half its earlier forecast of 185bn yen.

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