Honda moves Japan work to Swindon

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The first British-made Honda Jazz comes off the Swindon production line

Dave Harvey
BBC West Business Correspondent

Richard and Glenys Donald have just done a little spending for Swindon. The lorry driver and his wife have bought a new car, a Honda Jazz.

Until recently, the Jazz was made in Japan and shipped to Europe, but now the Japanese car giant is moving production to its Swindon plant.

Mr Donald says the "local factor" was not important.

"I can't say we bought a Honda because they're made here - we just chose the best car."

The Wiltshire factory will churn out 20,000 Jazz models in the first six months.

For those who see Honda as an economic barometer for Swindon, this is good news. It is not every day that a multinational moves production from Japan to the UK.

When Honda closed its Swindon factory for four months in February, the ripples spread far and wide.

DAVE HARVEY'S BLOG Even more interesting is what the Jazz tells us about the rest of Swindon, possibly the world, as we cope with this global recession Dave Harvey is the BBC's Business Correspondent in the West Read Dave's blog

Supply firms in the area had to lay people off, and everyone from taxi drivers to painter decorators felt the squeeze.

Staff numbers at the firm dropped from 5,000 to about 3,500 as workers took up the "Associate Release Scheme".

Moving production of the Jazz from Japan to Swindon is being seen as a clear sign that Tokyo trusts the town.

It also demonstrates how Honda is surviving the global recession relatively well.

The company's two Japanese rivals, Toyota and Nissan, have announced predicted losses for this year of $4.7bn (£2.9bn) and $1.9bn (£1.2bn) respectively.

'Not exciting'

Honda, though, will make a "modest profit", as a spokesman puts it, of $579m (£364m).

So what is keeping Honda in the black? According to many in the motor trade, it is their small, modest cars aimed at Mr and Mrs Average.

The Jazz, Civic, Accord and CR-V (the smallest 4x4 on the market) account for 75% of their sales.

One Honda dealer said he had sold 60 Honda Jazzes this year

They are small, fuel efficient, sensible even. In contrast, Toyota and Nissan both went heavily into the US 4x4 market, and have seen sales plunge.

At Swindon's biggest Honda dealership, the Jazz has saved them this year.

Mark Riddiford, the dealer principal at Fish Brothers, says that 2008-9 has been the worst period in his 20 years in the trade.

But the Jazz has sold well throughout. "It's a great car for the scrappage scheme, because it starts at £10,000.

"We've sold 60 Jazzes this year, just in this dealership."

Surprisingly, he does not disagree at the suggestion that the Jazz is not very exciting.

"Hondas don't have to be exciting or fast", he insists.

"They're safe and they're extremely reliable. Exciting doesn't always mean good."