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Honda cuts 800 jobs in sales slump
Staff at Honda's Swindon plant were told about impending job cuts as they arrived for work on Friday morning
Japanese car giant Honda is to cut 800 jobs at its UK factory just months after taking on hundreds of extra workers because of an expected increase in demand.
The firm blamed a slump in sales across Europe, especially in countries hit by the eurozone crisis including Spain, Greece and Italy.
Unite said the job cuts at the plant in Swindon were a "hammer blow" to manufacturing, warning of a huge knock-on impact on jobs in supply firms. Workers at the plant, which employs 3,500, were told the grim news as they arrived for their shifts on Friday morning.
Honda said it was the first time it had cut jobs in the UK since it started making cars in Swindon in 1992, adding that demand for cars in Europe had fallen by a million in the past year. The company gave the statutory 90-day notice of consultation and said it would seek to avoid compulsory redundancies.
Ken Keir, executive vice-president of Honda Motor Europe, said: "Sustained conditions of low demand in European markets make it necessary to re-align Honda's business structure. As such, Honda of the UK Manufacturing (HUM) will enter into formal consultation with its associates to consider these changes and the proposal that it will reduce the workforce by 800 associates by spring 2013.
"Honda remains fully committed for the long term to its UK and European manufacturing operations. However, these conditions of sustained low industry demand require us to take difficult decisions. We are setting the business constitution at the right level to ensure long-term stability and security."
Unite national officer Tony Murphy said: "This is a hammer blow to UK manufacturing and to Swindon where Honda is a major employer. The reality is that over 1,000 jobs are going at Honda - it's a disaster for manufacturing in the UK and for the local economy.
"It's a tragedy for our members and their families. There's no doubt these cuts will have a significant knock-on impact on the supply chain, and on local shops and services. Unite will oppose any compulsory job losses."
Business Secretary Vince Cable visited the Swindon site last September when Honda announced a £267 million investment programme, creating 500 new jobs because of an expected increase in demand as well as a new diesel engine line. Honda said the increase in demand had not happened so it now predicted that annual production would remain at 150,000 for the next three years, 100,000 below the plant's capacity.
A Business Department spokeswoman said: "This will be a bitter blow to the workforce and the local area and we will be working with local partners to minimise the impact of the job losses. Times are tough in the European market but the automotive industry remains a major success story for the UK. Over the last two years global manufacturers including Nissan, JLR and BMW have invested £6 billion in the UK, safeguarding and creating new jobs."