End is in sight for shortage of parts following Japanese tsunami and earthquake
The Honda car plant in Swindon will not return to full production until September following the Japanese tsunami and earthquake which have damaged the supply of parts from the Far East.
The announcement from the company came as it reported an 81% slump in output from its Japanese factories last month compared with last year. Honda said it hoped to resume normal output domestically sometime over the summer.
"We are extremely pleased that our European manufacturing operations can now plan for production to return to normal," said Ken Keir, executive vice-president of Honda Motor Europe.
Toyota, the world's largest carmaker, has said it plans to bring its UK production based on the Burnaston plant in Derbyshire back to full operations next month, while its business in Japan may be under power till the end of the year.
Toyota reported a 78.4% decline in output from its Japanese plants last month while a spokesman for the UK operation would only say that it was running at 30% to 40% of capacity.
Some plants in Japan have been damaged by the earthquake and need to be repaired; many of the parts used in UK car production are sourced from Japan and are now subject to disruption. Honda has been working a two-day week at Swindon, where it makes the Civic, CR-V and Jazz models, and is accustomed to producing nearly 140,000 vehicles annually. The company said normal production would begin "during September" and it would work hard to make up for lost output during the remainder of the year.
Flexible working hours arrangements mean pay for the 3,000 staff had been maintained, said the company.Similar moves were seen at Toyota.
"I am proud of all of our associates as they have shown great flexibility and commitment during this difficult time," said Andy Piatek, director of manufacturing at Swindon.
The earthquake and tsunami in March impacted negatively on wider growth in Japan and the national economy contracted by 0.9% in the period, but shortages of supplies caused by the disruption caused industrial and consumer prices to increase.
The Japanese government's statistics bureau has revealed that the country has overcome deflation, where prices fall rather than increase, for the first time in 25 months after consumer prices rose by 0.6% last month. A period of deflation is a serious threat to an economy because it deters consumers and businesses from spending in expectation of falling price.