Honda today shut down its Swindon factory for four months, in a bid to reduce costs during the global recession. It had originally intended to stop production for just 50 days.
All production at the Swindon site, where both the Civic and CRV are made, will cease during February, March, April and May. It will resume in June at a reduced rate.
The company believes that decisive action at this early stage will put Honda in a better business position as the market stabilises. “We aim to build vehicles to order, and this move allows us to regulate our supply and prevent a great deal of inventory from building up,” said a company source.
Company managers insist that longer-term prospects for the factory are healthy. “It’s a positive move for us, involving no compulsory redundancies. And with the new Jazz entering production at Swindon in autumn, there’s every chance, assuming the global economy improves, that the factory will be back to full capacity within 12 months.”
Swindon’s line workers, the majority of the factory’s 4200 staff, will be sent home during the idle period and will earn full pay for two months, and 60 per cent pay for the following two months.
The 250 hours that they are paid for during the lay-off will be ‘banked’, said a Honda source, and workers will be required to put in overtime in order to work them off before any more overtime will be paid.
Honda will be offering its idle workforce the option of working during the fallow period on local community volunteer schemes. Honda could not confirm whether hours spent doing this could be offset against any of the 250 banked hours.
Despite the fact that no compulsory redundancies have been announced, there are reports that up to 1000 of the site’s 2400 affected workers are opting for a voluntary redundancy package instead of the stay-at-home deal, and are taking the opportunity to either move or retrain.