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Global shutdowns continue

Down tools: Nissan's Sunderland plant in the UK is just one to feel the pain of recession.

Car-makers shut plants and sack workers as global recession continues to bite

General News logo20 Jan 2009

AUTOMOBILE production around the globe continues to be slashed as car-makers return from their Christmas breaks and find the need to further adjust to the growing economic slowdown.

The crisis is universal, but one of the worst-affected countries is the United Kingdom.

Britain was shaken by the announcement less than two weeks ago that Nissan was sacking 1200 of 3800 manufacturing workers at its huge Sunderland plant, which is the country’s largest and was widely regarded as one of the most productive and efficient in Europe.

Sunderland builds the Micra light car and Qashqai SUV (Dualis in Australia) and was on schedule to build a record 400,000 cars in the financial year to March 31, but will now produce only 300,000.

In the past week, Tata-owned Jaguar announced it would cut 450 jobs while Ford said its factory at Southampton, which produces the Transit van, will close for 20 days over the next three months and cut back from two shifts to only one, halving production over the next three years.

Things are also grim at Honda’s Swindon plant west of London, which was previously a beacon of success with its Civic and CR-V but has now extended a temporary shutdown and will not resume production until June.

The plant had earlier extended the Christmas shutdown into February and March, but workers have since been told that an extra 35 non-production days had been scheduled in April and May. Remarkably, the company has not laid-off any of its 4200 workers.

In Japan, however, Honda announced last Friday it would axe 3100 temporary workers as it slashes domestic production by an additional 56,000 units to the end of March.

A day earlier, Nissan had announced it will reduce domestic production by 64,000 units and will now build only 289,000 fewer vehicles in the financial year to March 31, a reduction of 21 per cent.

Amid reports that it will post its first loss since being rescued by Renault in 1999 and following earlier job cuts, Nissan said it will halt production at three Japanese plants for up to 13 days in February, followed by further stoppages in March.

Nissan’s US plants, meanwhile, will stay on a four-day work week indefinitely, having initiated the reduction last October.

In Korea, Hyundai announced it will produce 17 per cent fewer vehicles globally in the first quarter, cutting output from 712,000 units a year ago to 590,000.

Toyota’s inexorable rise to global domination has not prevented it from being similarly affected by weakened global demand, telling workers in the US last week that work schedules would be further slashed at nine North American plants in February and March.

Toyota’s additional cuts affect its vehicle and engine plants in the US and Canada, ranging from the elimination of 29 production days at Georgetown, Kentucky, where the top-selling Camry is built, to only three days at its Tundra truck plant at San Antonio, Texas.

The company, which said US inventory had doubled to as much as 90 days worth of sales in the last year, will also idle its Japanese plants for 11 days in February and March as it halves production (to about 9000 vehicles a day) compared to the same period last year.

Subaru, which is 16.5 per cent owned by Toyota, is also cutting production in Japan, looking to buy more parts from outside Japan and says it is scrapping plans to build a new plant for cars to be jointly developed with Toyota.

Chrysler will extend by one week a month-long shutdown of three plants, including one in Mexico, while both General Motors and PSA Peugeot Citroen are taking tough action in Brazil – GM slashing 744 jobs and PSA forcing 2600 workers to take an extra 30 days of leave.

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