Honda job losses show Brexit is now ‘project meltdown’
Today, down at various docks in the UK, there are thousands of shiny, sporty British made Honda Civic cars ready for export all over the world. They are there because Swindon is the world production centre for one of the company’s most important products.
The cars going on to the transporter ships now will arrive in Japan – the “home market” – towards the end of March, around Brexit day in fact. It was always a signal compliment to the quality of the cars made by Japanese firms in Britain, that they were deemed good enough for customers in Tokyo as well as Torquay.
Reliable products from a reliable workforce in a reliable nation. But now look.
No one, not even the board of the Honda Motor Company Limited or the British government can say if future car exports will have tariffs slapped on them because of Brexit. They do not even know what the situation will be if they try to send them across the English Channel in a few weeks.
That’s what Brexit uncertainty means in practical terms. For Swindon (where, by the way, 55 per cent of voters chose Leave in the 2016 referendum) it means the closure of a vast factory and the loss of 3,500 jobs.
The Honda decision may have been forming for some time, with other factors also at work, such as economic slowdown in China, the EU-Japan trade deal, and the diesel backlash. But, as with Ford and Nissan, Brexit made the difference – the wrong way – at the margin about future investment. More decisions of this sort will follow, in other sectors too.
It is a coincidence of timing that this depressing news from Honda comes as the normally reticent Japanese authorities have let it be known how insulted they are to be told by Liam Fox and Jeremy Hunt to hurry up on a UK-Japan trade deal. It is some cheek from Britain’s dynamic duo, when Hunt and Fox can show so little for their broader Brexit efforts.
Very soon the EU will enjoy superior trade terms with Japan than the UK – so much for global, buccaneering Brexit Britain
In the final analysis, it highlights the point that we are now beyond “project fear” and well into project meltdown. Very soon the EU will enjoy superior trade terms with Japan than the UK. So much for global, buccaneering Brexit Britain.
Honda has been treated badly. It helped rescue our old home car industry, British Leyland, from collapse with an industrial partnership that began in 1979. I learned to drive in a British made-Honda, badged as a Triumph Acclaim. Honda-derived Rovers sold very well indeed. They helped BL, later Rover, build vehicles people wanted. Even when their partnership was summarily ended when Rover was sold to BMW, Honda kept faith with Britain. When they’ve gone, what will be the impact on the British steel industry and on component makers across the UK?
To borrow a phrase, Honda, like all inward investors, preferred a strong and stable partnership. Innately conservative, they’re not inclined to panic. But they’ve been let down twice now. I’m not surprised they’ve cleared out.