Like Nissan, Honda appears to be a little more optimistic about operating in a post-Brexit market.
Honda has major investments in the United Kingdom, including the factory that builds the new Civic Hatchback for export around the world, and the automaker is standing firm about continuing production there despite the financial uncertainties of a post-Brexit market. In fact, Honda is spending 200 million pounds ($246 million) for further upgrades at the Swindon, England, plant.
"We need to carefully watch currency exchange and sales trends. But we have no intention of withdraw from the U.K. and will continue doing business there,” Honda Executive Vice President Seiji Kuraishi said, according to Automotive News Europe.
The company’s decision comes as automakers start to become a little more comfortable about operating in a post-Brexit U.K. For example, Nissan CEO Carlos Ghosn initially threatened to move assembly of the next-gen Qashqai away from the company’s Sunderland, England, factory. After discussions with the government, Ghosn later reversed course and confirmed the model’s production would remain in the U.K. He even announced manufacturing of the next X-Trail would move there around 2020.
Kuraishi told Automotive News Europe that Honda hasn’t received any extra government incentives for continuing operations in the U.K. However if Nissan gets any financial support, he’d like the same help for Honda and other automakers in the country.
The long-term effects of Brexit on the auto industry are still largely a mystery. Ford estimated the decision to leave the European Union could cost the automaker $400 million to $500 million next year. Meanwhile, GM figured the price at $400 million just for the second half of 2016.
An immediate change in the auto market after Brexit has been the increase in new vehicle prices because of the pound’s slumping value. PSA Group was first to respond, but Nissan, Ford, and General Motors’ Vauxhall division all made similar decisions soon afterward. Analysts worried that the higher costs would push people to purchase fewer cars.
Source: Automotive News Europe