The Japanese company builds 160,000 Honda Civics a year in Swindon, its only car factory in the EU.
A highly-volatile global car industry, a massive fall in demand for diesel cars, an increasing global preference for SUVs, the rise of electric vehicles and tougher emissions regulations have all been blamed for the closure, as has the recent EU/Japan trade deal, which lifted all tariffs on Japanese cars being sold into the EU, greatly reducing the need for Honda to have a European manufacturing base.
The news also comes in the context of a wider malaise in terms of Honda’s European sales. Last year it sold just under 135,000 cars in the European market, a 3% decline on 2017 – and around half its sales of a decade ago.
Consequently, Honda has inreasingly focused production in its home country in Japan at the expense of factories elsewhere. Indeed, the group has also announced that it will be ceasing production of its Civic model in Turkey in 2021.
Honda has been emphatic that the move had nothing to do with Brexit, with Ian Howells, senior vice-president for Honda in Europe telling the BBC: "We're seeing unprecedented change in the industry on a global scale. We have to move very swiftly to electrification of our vehicles because of demand of our customers and legislation.
"This is not a Brexit-related issue for us, it's being made on the global-related changes I've spoken about.
"We've always seen Brexit as something we'll get through, but these changes globally are something we will have to respond to."
However, this did not prevent Greg Clark, Secretary of State for Business, Energy and Industrial Strategy, speaking at the EEF Conference, from saying: "The news from Honda demonstrates how much is at stake for UK manufacturers. The uncertainty around Brexit is unacceptable to manufacturers. We need to find a deal."
