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Thousands of workers at Honda’s Swindon factory have returned to work after the troubles of the car industry forced its closure four months ago. All 3,400 of the returning workers will be taking a pay cut until 2010 but are pleased that their jobs are finally guaranteed after spending the last four months worrying about the possibilities.
The factory was forced to close while the company decided on the best way of dealing with the problems caused by the global recession and the effect the economic downturn has had on the number of car sales and contract hire agreements. The motoring industry has been hit hardest of all and almost all car manufacturers are having difficulty staying afloat, but Honda’s experience could serve as a good example to the other brands still hanging in the balance. Their decision to temporarily close the Swindon factory has allowed them time to make important decisions about the future of the business as well as perform long-planned maintenance work. During the four months downtime the production lines were stripped down and rebuilt, and the entire plant was redecorated, wherever possible using existing employees with the relevant specialist skills or training.
But not everything is good news. A further 1,300 Swindon employees chose to take voluntary redundancy when the factory closed, many of whom still have not managed to secure alternative employment. And though the workers now have peace of mind that their jobs are safe, they have agreed to a pay cut of 3%, or 5% for those in management positions, for the duration of the next 10 months. The plant is only running at 50% of its normal capacity, with a predicted total production of 113,000 vehicles in 2009, less than half the original intended number of 228,000.
In short, it’s a small victory but the company is not out of the woods yet, Honda car leasing and sales figures will have to increase significantly over the next few months if they want to avoid any further disasters. The Swindon factory is due to start production of the new Honda Jazz model in September, which should increase sales and work towards securing the long-term future of the plant. Not to mention as the economy begins to recover buyers will be taking advantage of low car prices as across the board from Honda to Mercedes, car leasing and purchase prices are cheaper than ever.
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