Honda’s UK factory to suspend production till 1st June, 2009
Tumbling profits have forced Honda’s UK factory to go into long break. Workers at motor giant’s plant made the last car on January 31, and went on extended shutdown of 4 months caused by big slump in sales. Production will remain suspended till June 1.
The company has agreed to pay full basic pay to its 4,200 workers for the first 2 months and 60% for the remaining period of production shutdown.
Honda will retain its workforce at Swindon plant for production of Jazz model which is due in autumn.
A large number of car manufacturers in the UK have cut their production targets and jobs due to big decline in sales on account of recession, which crumbled many auto part suppliers.
Honda Motor Co., Japan’s No.2 carmaker, compelled by falling sales, rising costs and stronger yen, slashed annual profit targets by 50% as its quarterly profit went down by 90%. Its net profit tumbled from 200 billion in October-December 2007 to 20.24 billion in the same period in 2008.
Honda revised its profit target for the fiscal year ending March 2009 by 57% to 80 billion yen from 185 billion. It also cut revenue target by 3% to 10.1 trillion yen from 10.4 trillion.
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