Page last updated at 06:21 GMT, Thursday, 4 December 2008

Japanese juggling act for jobs

By Dave Harvey
Business Correspondent, BBC West

Honda production line, Swindon
Honda's Swindon plant will close for two months in early 2009

Fewer car sales mean fewer jobs in car factories, you would think. But even though Honda will make 25% fewer cars in 2009, they plan no redundancies. Can it be done?

The numbers are huge. The Japanese car giant has invested 1.38bn in its Swindon factory, where it makes about 225,000 vehicles a year, mostly the Civic.

There are 4,800 workers - or "associates", as they are called - at the plant itself, but when you count firms that supply seats, electronics, widgets and so on the numbers go into tens of thousands.

'Very precarious'

Recent news that the plant will close for all of February and March next year caused shock in the Wiltshire town.

"The position at Honda is very precarious", said Jim D'Avila, the regional spokesman for the trade union, Unite.

But Honda does not believe in redundancy. It sounds extraordinary, but it is true.

Honda remains committed to safeguard all associates' jobs
Honda spokesman

"It should make my life marvellous", said Mr D'Avila, "if every firm was like this, no-one would ever get sacked, we'd hardly need trade unions.

"There would be no firms making any money, of course, but that's beside the point."

The strategy is to cut hours, not jobs. Workers, or, as they call them, "associates", have a working time account.

If the factory shuts or production slows down, they work fewer hours, owing the company time. Then when demand picks up again they can work extra hours without incurring overtime.

A spokesman for Honda told the BBC: "Despite the economic downturn, Honda remains committed to safeguard all associates' jobs."

Suppliers hit hard

That at least is the plan. But although it works at Honda, it is not so easy for the suppliers.

Take SDC, a distribution firm just across the road from Honda. They organise all the logistics to get parts into the assembly line "just in time".

They employ 600 people, and their fortunes are tied to the Japanese "Mother Company", as they call it.

General manager Steve Gopal said: "We wouldn't be able to support 250 associates being kept in on non-production tasks, for the next 6 months".

Soon Honda itself won't be able to sustain these production cuts without real redundancies. They're in denial.
Jim D'Avila Unite

On Monday he told staff there would be 135 permanent jobs going, and 94 temporary ones.

Up the road, another anonymous industrial estate houses a firm that makes the seats for the Honda Civic - 800 people depend on it.

Director Malcolm Corcoran said: "We are still doing the numbers but we are going to have to work with fewer people."

Mr Corcoran is still consulting with his "associates", and it is clearly not a task he enjoys.

So where does this leave Honda's much vaunted "no redundancy" philosophy?

Jim D'Avila of Unite said: "It would be great if it were true but it already is cracking for the supply companies.

"And soon Honda itself won't be able to sustain these production cuts without real redundancies. They're in denial."

Print Sponsor

Honda plans to reduce workforce
01 Dec 08 |  Wiltshire
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28 Oct 08 |  Wiltshire
Honda Swindon closing for 50 days
21 Nov 08 |  Business

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