The wheels stop turning at Honda

by Dave Harvey Business Correspondent, BBC West

As the Honda factory in Swindon closes down for a four-month break after a downturn in sales its workers look to the future.

One, Andy McGurk, is fitting a bathroom instead. It makes a change from welding.

"Yes, this is my new career", he smiles. "Time for a change, I thought, with the climate like it is."

After years making cars at Honda's factory in Swindon, Mr McGurk will now earn a living as a plumber, and train to be a gas fitter to boot.

He and hundreds like him have taken a cash payout to leave Honda.

But the entire workforce will be out as well from February when the factory closes for four months.

Staff who remain will be paid in full for two months and at 60% for the next two months.

The recession is real, and it's here. Other trade is OK - coal, containers for example, but cars are really down Patrick Kearon - Bristol Port Company Four-month break to begin

"The morale is OK", says Mr McGurk. "When we first heard, we were all really worried - would the whole place go? But now people think it's a good deal.

Honda is keeping our jobs alive, and you can't ask more than that."

Honda famously does not mention redundancy. Even the scheme that has seen hundreds of workers leave with a cash payout emphatically ignores the "R" word.

It is, I am told, an "assisted leaving scheme".

Suppliers are not so fortunate. Across the road from Honda's factory, one company has laid off nearly half its workforce.

SDC handles all the parts that come in from across Europe - 230 people drive forklifts and check pallets.

When the factory goes quiet, SDC will have no work. More than 100 workers have had to leave.

The Honda closure is having a ripple effect on many small local businesses

It is the same story in small engineering firms across the west of England. Many have no other customers. If you make seats for the Honda Civic, there are not many other firms interested in your product.

But the ripples go wider still.

On the dockside at Bristol's Port, Hondas are lining up. This is the UK's busiest port for cars, and yet their auto trade is down 35%.

"The recession is real, and it's here", says Patrick Kearon, from the Bristol Port Company. "Other trade is OK - coal, containers for example, but cars are really down."

When you see the scale of the Honda factory, and the number of companies that rely on it, it is easy to understand why steel makers are laying people off, why manufacturing is now hurting so much.

Out of pocket

Even small pubs are feeling the heat.

Just a few miles down the road from the plant, Robert Feal-Martinez runs a traditional inn. He sells Arkells Ale, and has a few motel rooms which are always popular with contractors.

"We were full every week", he recalls. "IT people working at Honda, maintenance men, you name it."

Not any more. His rooms are empty, his dining room is quiet. He too has laid off staff - eight part time jobs have gone.

When a car factory closes, it seems everyone nearby knows somebody out of pocket.

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