TOKYO – Honda said Tuesday plans to close its car factory in western England in 2021, interfering with 3,500 jobs in a new blow to the UK economy as it faces its March 29 exit from the EU.
The Japanese automaker announced the decision at a press conference in Tokyo, where Honda's president and CEO, Takahiro Hachigo, told reporters that the decision was based on what made the most sense for its global competitiveness in light of the need to accelerate the production of electric vehicle.
Brexit was not the main factor behind the decision, he insisted.
"We still don't know what kind of changes Brexit will bring at this point," he said. "We have to wait until we get a better idea of the situation."
Hachigo said the company would immediately begin discussion with affected workers at the Swindon factory.
"I'm very sorry," he said, adding that "this was the best choice circumstances."
Honda Motors CEO Takahiro Hachigo responds during a press conference at the carmaker headquarters in Tokyo, Japan, February 19, 2019. Hachigo announced the company's global car manufacturing restructuring which includes the closure of its Swindon factory in the United Kingdom in 2021. (Photo11: FRANCK ROBICHON, EPA-EFE )
Honda makes its popular Civic model at the factory, 115 kilometers (70 kilometers) west of London, with a production of 150,000 cars per year. The restructuring is aimed at adjusting its operations to reflect stronger demand in Asia and North America. Hachigo said.
The next model of the Civic to be sold in the UK will be exported from Japan, the company said.
The company said it will also adapt its operations in Turkey, where it produces 38,000 Civic sedans a year.
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British companies are issuing ever-increasing claims of the damage done by the uncertainty surrounding Brexit. The UK has not yet sealed an agreement that sets the divorce terms and conditions and determines which trading rules will apply after Brexit.
When presenting the restructuring plan, Hachigo emphasized that Honda was trying to adapt to a worldwide global industry.
"We need to move faster," he said.
Associate press author Haruka Nuga in Tokyo and AP Business Writer Elaine Kurtenbach in Bangkok contributed.
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