Features

Honda closes factory – is Brexit to blame?

Brexit and global manufacturing trends are proving to be a double whammy for car factory workers in Britain.

935-Honda-634
Brexit adds a "go-slower" stripe

"For at least a year, bodies such as the Confederation of British Industry (CBI) and manufacturers' association the EEF and the British Chambers of Commerce (BCC) have been telling ministers that the uncertainty caused byBrexit would have serious consequences," says Larry Elliott in The Guardian.

So the news that 3,500 jobs will be lost when Honda closes its Swindon plant by 2022 "will make the employers' organisations even more insistent that a no-deal outcome should be ruled out". Brexit isn't the only factor, but it "played its part", as shown by Japanese lobbying for a softer Brexit. Honda's decision will "add to the already considerable pressure on Theresa May".

Those blaming Brexit "should listen to what the company has to say", says Ross Clark in The Daily Telegraph. Not only has it explicitly denied a link between the two, but it has said that "it is also closing a plant in Turkey, and will not be shifting any production to EU countries". Honda would have closed its Swindon plant, Brexit or no Brexit. Indeed, you could even argue that European pledges to phase out petrol and diesel cars by 2040 have left the industry in "a huge state of flux".

Still, leaving the EU won't make it easier to encourage further investment from car companies to replace the lost jobs, says Liam Proud of Reuters. More than half of UK-assembled cars are shipped to the continent and "a post-Brexit immigration crackdown" will make it harder to find skilled workers, "something the UK car industry already struggles with, judging by the sector's 5,000 unfilled vacancies". Last year saw inward investment in new production capacity fall by half. Brexit will give the UK's car industry a "go-slower stripe its workers will hardly appreciate".

Recommended

Brexit begins: what do the UK and the EU want from a trade deal?
Brexit

Brexit begins: what do the UK and the EU want from a trade deal?

With Brexit now done, the trade talks can begin. But who wants what from a UK/EU trade deal, and how likely are they to get it?
3 Feb 2020
How long can the good times roll?
Economy

How long can the good times roll?

Despite all the doom and gloom that has dominated our headlines for most of 2019, Britain and most of the rest of the developing world is currently en…
19 Dec 2019
I wish I knew what negative interest rates were, but I’m too embarrassed to ask
Too embarrassed to ask

I wish I knew what negative interest rates were, but I’m too embarrassed to ask

There’s been a lot of talk from the Bank of England recently about introducing “negative interest rates”. So what on earth are they, and what would th…
20 Oct 2020
Negative interest rates and the end of free bank accounts
Bank accounts

Negative interest rates and the end of free bank accounts

Negative interest rates are likely to mean the introduction of fees for current accounts and other banking products. But that might make the UK bankin…
19 Oct 2020

Most Popular

The Bank of England should create a "Bitpound" digital currency and take the world by storm
Bitcoin

The Bank of England should create a "Bitpound" digital currency and take the world by storm

The Bank of England could win the race to create a respectable digital currency if it moves quickly, says Matthew Lynn.
18 Oct 2020
Negative interest rates and the end of free bank accounts
Bank accounts

Negative interest rates and the end of free bank accounts

Negative interest rates are likely to mean the introduction of fees for current accounts and other banking products. But that might make the UK bankin…
19 Oct 2020
What would negative interest rates mean for your money?
UK Economy

What would negative interest rates mean for your money?

There has been much talk of the Bank of England introducing negative interest rates. John Stepek explains why they might do that, and what it would me…
15 Oct 2020