Honda Uk Hopes To Restart Monday After Parts Shortage Shuts Down Production

Honda UK hopes to restart Monday after parts shortage shuts down production

LONDON — Japanese carmaker Honda hopes to restart production at its British factory on Monday after halting output because of transport-related delays that caused a shortage of parts.

Britain's major container ports, such as Felixstowe, have been hit by the Covid-19 pandemic, which has disrupted global trade, leaving containers in the wrong place and goods stacked up.

That has been compounded in recent weeks by Christmas stock and goods being stockpiled before Brexit, as London and Brussels struggle to reach a trade deal before Dec. 31.

The automaker halted production on Wednesday at its Swindon site in southern England, where it made just under 110,000 Civic hatchbacks last year.

"The situation is currently being monitored with a view to re-start production on Monday," Honda said on Thursday.

Major automakers operate just-in-time manufacturing, meaning some parts arrive moments before they are fitted to vehicles.

BMW, which builds pressed parts at a nearby site in Swindon and manufactures its Mini car at its Oxford factory, said it was seeing some "longer transit times," but both sites had started an annual Christmas shutdown with no impact on output or maintenance.

"Our business is well-prepared for a wide range of different scenarios that may have an impact on delivery schedules," it said.

Businesses are taking steps to prepare for any disruption from Jan, 1 when a transition period ends, severing Britain's relationship with the EU. Measures, include increased stocks, possible use of air freight and alternative ports.

The details of a Brexit trade deal, if agreed, will determine decisions on upcoming investment, including whether French carmaker PSA keeps its Vauxhall Ellesmere Port factory open.

In September, a source told Reuters the EU did not want to allow components from countries such as Turkey and Japan to count towards a content threshold, posing a risk of tariffs for some greener vehicles with batteries made outside the continent.

"Regardless of whether there is a free trade deal agreement or not, there will still be rules of origin for batteries and plug-in hybrid vehicles that will be affected," PSA's UK Managing Director Alison Jones said last week.