The closure of the Honda plant is expected to have a ripple effect on economic activities and livelihoods

By Swindon Link - 26 August 2021

Features

Not that long ago, the Honda Motor Company confirmed the sale of the Swindon Plant in the United Kingdom. The vehicle production facility is to be sold to a logistics company, therefore, ending a chapter in Swindon’s history.

  • Photo by Tim Mossholder on Unsplash

    Photo by Tim Mossholder on Unsplash

Panattoni will acquire Honda’s 370-acre factory, which has been active for 35 years. Panattoni is regarded as Europe’s largest developer of logistics property and refers to itself as the UK’s leading speculative developer. It has succeeded in constructing and developing large-scale sites for companies such as Amazon, Marks and Spencer, and Sainsbury’s, just to name a few.
 
What are the long-term effects of the Swindon Plant closure?
 
The loss of Honda in Swindon is terrible news for the people who work there. Some of those affected will be asked to share their feelings and politicians will no doubt send their thoughts and prayers to the individuals now out of work. The result is employment and disability. When a reasonably sized factory is closed down, the immediate consequence is the loss of jobs.
Roughly 3, 000 people used to work at the Swindon Plant. These individuals and those from surrounding areas will suffer income loss, so there will be regional consequences. There’s fear that the closure of the Honda plant will have a ripple effect on the economy, as 1, 800 people working at two local firms supplying the plant have lost their jobs.
Some of the plant staff had just joined for apprenticeships or were among the loyal employees who had dedicated years of their lives to the job. The closure announcement came without warning in February 2019, yet the reality of the situation is now hitting hard. The Honda plant represented a useful component of the local economic base and the closure will have a large downstream impact on the economy as a whole. We’re talking about the losses sustained by the industries engaged in commerce with Honda. Unaffected industries will have to deal with the changes in the spending patterns of households and companies that have suffered direct or indirect impacts.
The spending-cut will resonate through the local economy, affecting the entire geographical area. So, unemployment affects the disposable income of families, diminishes the purchasing power, and reduces the economy’s output. It’s important to keep in mind that the private sectors can recover from losses via modernization, public-private partnerships, foreign investments, the use of innovative products, and aggressive marketing. There’s something inevitable about factories closing down, so it’s necessary to find better ways to respond.
 
Why is Honda leaving Swindon?
 
The Japanese automaker moved to Wiltshire town in 1985. Since then, Honda Associates have produced more than 3.7 million cars. The reason why Honda Motor Company came to Britain is that it was part of the European market. In spite of the fact that standards were poor in the British car industry, they improved pretty fast. The Swindon Plant, one of the most productive ones, has closed. Very few firms in Swindon offer such working conditions, career progression,
or salaries. Honda stated that the restructuring plans represent a response to the unprecedented changes in the global automotive industry. It begs the question: Why is the Japanese automaker really leaving Swindon?
Naturally, there has been lots of speculation regarding the connection between the timing of the closure announcement and the fast-approaching Brexit. The United Kingdom’s departure from the European Union might not have affected the corporation’s decision, but there’s no denying the fact that it has played an essential role. The uncertainty of the government affects the economy and, therefore, profit. At any rate, resources and production will move to China, Japan, and the United States. It’s expected that Honda will have a high volume of customer
demand. The Japanese automaker insists on the fact that the decision was made with a great deal of sadness.
 
What are people supposed to do now?
 
Generous redundancy packages have been offered for Honda employees, providing additional help in hard times. The aim is to alleviate the setback of the job loss. Either way, it’s still a significant shift in Swindon’s employment market. Individuals will be competing against one another for job security. According to recruitment agencies, what represents a threat to some people is an opportunity for others. At present, there are more jobs than people to do them.
Recruiters stress that the problem is acute. The closure of the Honda plant could benefit other businesses. As far as workers are concerned, they must have realistic expectations regarding pay. As mentioned earlier, not every company pays as well as the Japanese automaker.
Reacting quickly helps minimize and even avoid major problems that come with being unemployed. Finding new employment is a challenge, but it’s possible. There isn’t much in terms of career development and salary in Swindon, but it’s better than nothing. Anyone leaving Honda can try to secure a job at Amazon. Better yet, they can take the plunge and start their own businesses. The strength of Swindon lies in its industrial logistics. Many companies outsource their logistics to guarantee better organization in the supply chain. Getting laid off can be stressful and discouraging, yet it might turn out to be a blessing in disguise. Companies in their first year can’t obtain small business loans, so they have to rely on other types of financing. It’s tough out there, but things don’t necessarily need to get worse.
The council, government, and business representatives are making great efforts to prepare Honda workers for the job market. This form of social action supports people in order to improve their skills and employment prospects. The help of the National Careers Service was requested to support individuals. A functional skills training program was organized by SWLEP, allowing people to make informed decisions about life. Local businesses Recycling Technologies and Catalent offered to help Honda apprentices complete their training courses and stay in new jobs in the growing sectors of the economy. Other companies have manifested their interest in recruiting from the plant’s workforce.

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