Sayonara Swindon? Honda, Please Don’t Go!

UPDATE: Honda has confirmed that it will shut the Swindon plant in 2021.

Honda may be about to announce the planned closure their Swindon plant in 2022, at the end of the lifecycle of the current Civic. It has been building cars since 1992 starting with the Accord, and has produced the Civic, Jazz (Fit in the US) and CR-V nameplates over the years. Now, it looks like the end is in sight.

Brexit, right?

Everything in Europe and the UK in particular has been pinned on Brexit. However, while this will not have helped the case for keeping Swindon open, it was not the key factor, and in fairness I have yet to see anyone pin this on Brexit.

The writing has been on the wall for some time. Swindon vehicle production had wound down to Civics for the European market and 5 doors globally, including the much lauded Type R.

Honda has been taking vehicles out of Swindon over recent years, with the Jazz ending in 2014 and the CR-V ending in 2017, consolidating back to the Japanese plants to help fix plant utilisation there. The market served by Swindon (see below) has therefore been shrinking while the vehicle source has changed.

The end looks inevitable…

Based on European sales data, Civic demand is now around 65,000 per year relative to a reported production capacity of 160,000 – a 40% capacity utilisation rate, unsustainable for any plant. The Civic is also built in several other locations, so there is enough global capacity elsewhere from which they can be imported.

Are Nissan at risk?

A dominant player in Europe and a pioneer of the SUV movement

In my opinion, no. By contrast, Nissan Sunderland serves a market of 250,000+ Qashqais sold each year in Europe. There has been much fanfare surrounding the pseudo loss of promised jobs to build the X-trail in Sunderland too, but with the start of production in Nissan St. Petersburg last year (Russia is the largest market in Europe for the X-trail) there is plenty of capacity available for current demand.

Uncertain times ahead

The entire automotive industry is in a phase of consolidation and restructuring for a number of reasons. These stories will continue to appear around the world while companies adjust their manufacturing footprint to ensure profitability and secure their future as they fight for a place at the table in a world moving towards autonomy and electrification.

Only time will tell what the scale of change will ultimately be.

Is this the first domino, or is it just a case of economics at work? Have your say in the comments below…

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