Honda Drawing Back UK Production In Face Of Weak Growth

Cameron Aubernon
by Cameron Aubernon
honda drawing back uk production in face of weak growth

With a forecast of low sales growth in Europe expected to remain in place for the next few years, Honda has decided to scale back production at its plant in Swindon, England.

Reuters reports the plant will go from three shifts to two, resulting in a 10 percent layoff in the workforce. Honda will build about 120,000 vehicles annually, down from 140,000 in 2013. Swindon has the capacity to build 250,000 cars per year, but at projected levels, the plant will be severely underutilized.

Though Honda Motors Europe senior vice president Ian Howells said his company had not seen the growth it expected in 2013 in the European market, figures for January showed overall sales climbing 5.2 percent on the strength of demand from Italy, Portugal and Greece. Meanwhile, the United Kingdom’s sales climbed 10.8 percent in 2013 to 2.26 million vehicles.

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  • Diewaldo Diewaldo on Mar 26, 2014

    The car on this picture is not model of the civic which is currently on sale. It is acutally an old model generation. So move on ... nothing to see here. *g*

  • HerrKaLeun HerrKaLeun on Mar 26, 2014

    this is one of the mysteries and proves the car industry is not intuitive: - in Europe VW is King and considered a reliable and low-depreciating brand, while in the US they just can't get it done - in the US Toyota and Honda are king, but in Europe just don't really get a foothold. Especially Honda is very small in Europe. That civic is fugly, if it was offered in the US it also wouldn't sell. The fit is a beauty compared to it (and I love the Fit for its practicality and at least it looks neutral) Does Honda suffer the GM syndrome? Car sales are going down, and the CEO probably is blaming the market, the euro, but not the product?

    • See 2 previous
    • Bill Wade Bill Wade on Mar 27, 2014

      @threeer In europe, measuring reliability is done differently than how we do over here. ------------------------------------------ That's interesting, it either broke or it didn't. Really nothing to measure here.

  • Marcelo de Vasconcellos Marcelo de Vasconcellos on Mar 26, 2014

    I think that Honda's problem in Europe (Toyota, too, but slightly different) is that they offer, broadly speaking, the same as the Europeans. When they entered the US, they offered a different car, based on a set of different paradigms, that slowly, but surely, allowed them to get more and more of the US market. Of course, the extra dose of reliability they offered didn't hurt their case either. Conversely, they became more attuned to American tastes, ever so slightly, and that may also hurt their case as Europeans in general don't like American car dynamics or the simple interiors Japanese makes generally offer. Toyota, besides many of the same things that hurt Honda, also has the controversial driving dynamics and a design language even more anodyne than Honda. It must also be taken into account the penetration and diffusion of the availability of parts and even technical support. As the cars have less penetration, as soon as you leave the major cities, mechanics will have less experience with the cars and less incentive to get the necessary tools to deal with them. Europeans have also seen their cars improve in their own lifetimes. In terms of reliability, strength, economy, even size. It's not like the American experience where the perception is that there was a Golden era way back when, a malaise era, then it all got good, then things started going wrong, with smaller engines or smaller cars. This perception, opens the doors to look at other alternatves. Lastly, there is the issue of nationalistic choices. As far as I can tell, and of course this doesn't apply to every single person in Europe, but Germans don't really seem to be open to idea of buying a foreign brand (much like the Japanese). Americans in contrast seem to enjoy buying imports, at least a greater percentage of the population appears to me to be that way.

  • Carrera Carrera on Mar 27, 2014

    Yes, for different reasons Honda has not really caught on in Europe. Depending on the country, the VAT tax on a Honda was higher if the car was made in a non-EU country. Even when the cars were made in the UK, like most European Civics and CRVs they were fairly high priced. I was just looking at some prices and it seems that a 5 door Civic as mentioned in this article is anywhere from 15,000E to 22,000E and that's without the VAT included. A comparable VW Golf is from 14,000E to 20,000E but VAT is included. Now if we add the VAT, the cheapest Civic becomes 18,712 which makes it at least 3,000E more than a comparable Golf. All these prices I got from Honda's Romanian site and also from VW Romanian site. I am not sure where the European Accords ( looks like our Acura TSX) are made, but I remember a few years back, a brand new loaded Accord, including the VAT was about 39,000E. Now, I see the prices have gone down to 31,000E, but back then, 39,000E was dangerously close to BMW 3 series territory. In most European countries ( at least East European) most people would pick a BMW over anything Japanese. The European Japanese cars are more or less just as reliable as the North American Japanese cars. The very few people that buy them, they fall in love with them, but a great majority are not even willing to try. I have family in a 300,000 people town in Romania and on my last visit I probably only saw 3 or 4 CRVs, 2 or 3 Accords and don't remember any Civics. I have a friend who drives a Subaru Outback and most of his friends think he is crazy for not buying a VW or a BMW. Toyotas on the other hand, are a little more common, but not nearly as common as German cars. The most common Asian brand, and that's due to price, are the Hyundai Group ( Kia included). Most of them are made in Czech Republic or Turkey ( non EU, but they have some sort of automotive treaty when it comes to cars). In the past 7 years, they have become very, very common. It took a while but as more people tried them, they were surprised by how reliable and low cost the little Kia C'eed and Hyundai Accent were.

    • Marcelo de Vasconcellos Marcelo de Vasconcellos on Mar 27, 2014

      And that's another way to do it, pricing. It seems the Koreans are willing to do it, but the Japanese aren't. As Europeans are fairly happy with the "home" brands, the Japanese do not seem on the verge of really growing in the market yet.