Honda And Fca Won't Restart Their North American Plants Until May

Honda and FCA won't restart their North American plants until May

TOKYO — Honda on Tuesday said that it had furloughed workers at its U.S. plants, which will be closed until May 1 as demand for cars in the country has plummeted due to the spread of the coronavirus.

A spokesman for Honda, which employs about 18,400 workers at plants in Alabama, Indiana and Ohio, said the Japanese automaker would guarantee salaries through Sunday, having suspended operations on March 23. Operations at its Powersports plant in South Carolina, which makes all-terrain vehicles (ATVs), have been suspended since March 26.

Automakers are facing a drop in sales in the United States, the world's second-largest car market, after some states barred car dealers from selling new cars while "stay at home" orders are in place.

Last week, Nissan said it would extend its U.S. production suspension into late April. Toyota has halted its U.S. and Canadian production through April 17.

On Monday, both Honda and Fiat Chrysler Automobiles said they hope to restart U.S. and Canadian auto production in early May.

U.S. President Donald Trump last week extended the guidelines aimed at slowing the spread of the coronavirus to April 30.

Several U.S. auto industry executives told Reuters on Monday it will be nearly impossible for companies to resume production before the end of the month — and there is no assurance automakers will be able to resume production in early May. Other automakers plan to extend current production halts later this week, automakers told Reuters.

It will also take auto suppliers time to resume production. In an internal estimate, Ford said last week it believed 600,000 U.S. industry auto sales may have been lost in March because of the coronavirus outbreak.

Honda noted many consumers are unable to purchase vehicles and said it "must continue to suspend production in order to align product supply with a lack of market demand." Some states have barred car dealers from selling new cars while "stay at home" order are in place.

Ford said last week it was postponing its plan to restart production at its North America. Ford had been aiming to resume production at several key U.S. plants on April 14, but then said it would now do so at dates to be announced later. Ford said Monday it is "continuing to assess public health conditions, government guidelines and supplier readiness to determine when the time is right to resume production in our North American plants."

General Motors has shuttered its plants indefinitely and has not provided a date for vehicle production to restart.

Automakers are working on additional employee protections to add when they restart, including new personal protective gear, staggering shift starts, more frequent cleanings and new social distancing rules.

Fiat Chrysler said it will redesign "work stations to maintain proper social distancing and expanding the already extensive cleaning protocols at all locations."