Honda plans to front-load UK production prior Brexit

brexit and eu

Braced for a possible logistical problem when Britain exits the European Union in March, Honda Motor stated on Friday it was planning to front-load some production at its plant in the nation to ship overseas or develop inventories.

The Japanese automaker, which creates the Civic hatchback model at its factory in Swindon, southwest England, might encounter possible supply chain, production and distribution issues if Britain’s boundaries are disrupted from March 29, when the nation is due to leave the EU.

“To avoid any possible disturbances at the end of March … we’re making a number of preparations including front-loading some manufacturing to ship or step up stocks,” Honda Chief Operating Officer Seiji Kuraishi informed reporters in Tokyo.

Automakers in Britain have cautioned that their manufacturing facilities, which rely on the constant distribution of components to go into production cycles, would be significantly impaired if Britain leaves without a trade bargain, requiring the need for customs checks at borders.

Earlier this month, Honda stated it would certainly stop its British operations for six days in April to assist country to any kind of disturbances arising from a possibly chaotic Brexit.

Announcing its third-quarter results on Friday, the automaker stated enhanced discounting on its prominent CR-V SUV crossover pushed operating revenue down 40 percent in October-December, while quality-related prices and money volatility also stung its bottom line.

Honda posted revenue of 170.1 billion yen ($1.56 billion) for the quarter, rolling from 284.5 billion yen a year back and threatening a median estimate for 208.8 billion yen from 10 analysts polled by Refinitiv.

Kuraishi stated the company had raised price cuts on 2018 model CR-Vs marketed in North America, where supplies had developed towards the end of the year, to include the present year model.

Such discounting helped increase sales in The United States and Canada to 498,000 units throughout the period, increasing from 491,000 a year earlier. While it managed to throw the trend of slowing demand in the United States, higher incentives reduced profitability in the region.

Honda’s worldwide automobile sales came in at 1.41 million vehicles in October-December, compared to 1.34 million a year previously, enhanced by increasing sales at home and also in Asia.

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