Honda: Brexit casualty, green job opportunity

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Published 19th February 2019

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Thousands of Honda workers I represent will understandably be feeling shell-shocked after the company announced it is to close its Swindon factory. I’ve worked closely with Honda since the Brexit vote, listening to them and supporting them in their struggle to persuade the government to understand the needs of ‘just-in-time’ manufacturers working across the EU single market. I also know having visited the company’s state-of-the-art factory in Swindon that such a decision would not have been taken lightly as the plant represented an enormous sunk cost.  

The loss of 3,500 skilled jobs in a place like Swindon is a terrible blow. And this is just the tip of the iceberg, with at least double that number likely to be lost in the supply chain. The fact that we are on the road to a damaging Brexit, heading at speed towards the cliff face, is definitely a factor in Honda’s decision to close their factory, whatever the company might say publicly. But one glance in the rear-view mirror throws up a host of other related issues that have spurred this decision.   

Firstly, we need to remind ourselves why Honda came to the UK in the first place. The Thatcher government of the 1980s offered subsidies to car manufacturers to base their assembly plants in the UK. The country also offered a route into the single market. This relationship of trust has been ruptured by the vote to leave the EU and now the famously restrained but highly risk-averse Japanese corporations have clearly decided that the decades-old relationship between the UK and Japan has been betrayed.  

Then there is the changing car market, being driven by emerging political and public priorities for tackling our climate emergency. Somewhat surprisingly for a Green MEP, I have publicly championed Honda for their decision to move away from the internal combustion engine towards electric and hydrogen vehicles. Here again the UK has failed the company.  

The Tory government has turned its face against the sustainability transition. Despite regular doses of greenwash from the Tories, the UK provides more subsidies for fossil fuels than any other EU country and England has pledged to phase out the sale of petrol and diesel cars as late as 2040. Compare this with Norway which plans a ban by 2025. And then there is China, which as any atlas will reveal is pretty close geographically to Japan. Here the Beijing government has called for one out of every five cars sold in China to run on alternative fuel by 2025, heralding the advent of the world’s largest market for electric cars.    

Thirdly, there is the new trade deal between the EU and Japan that was signed off last year. Commonly known as JEFTA, this was not a trade deal that I or my Green colleagues supported. It is the biggest ever such deal in terms of trade value but it contains some of the damaging hallmarks of similar deals such as TTIP and CETA. It leaves public services exposed to further privatisation and environmental agreements that are non-binding. For example, it contains no powers to hold Japan accountable for illegal timber and whaling. It has also agreed to zero tariffs on car imports into the UK from Japan, which has suddenly made the idea of consolidating car production in Japan rather than inside the EU more attractive. Despite its flaws this is the deal that, before Hunt and Fox’s diplomatic gaffe, the UK hoped to copy and paste if we leave the EU. But until our trade deal with the EU is in place, Japan has a closer trading partnership with the bloc than we do. 

It would be wrong to let Honda off the hook entirely. They have provided decades of secure and well-paid employment in Swindon but, like all multinationals, remained free to walk away if it became more lucrative to set up elsewhere. It is therefore encouraging that Honda’s UK director says the company is committed to helping workers through this difficult time. Hopefully that means supporting them re-train and find alternative employment.  

And what better opportunity than to re-employ these skilled workers to work for the economic transition needed to deal with climate change and the environmental crisis. Swindon was once one of the principal maintenance centres for the railways. Then it transitioned to become an important hub for car manufacturing. It seems like the town is facing a new chapter. So let’s make sure Swindon is at the forefront of the transition towards a green economy. The skills of the workers at the car factory could be transferred into renewable energy technologies, electric bicycles, public transport, and engineering retrofit. Together with government backing, Honda could help ensure that Swindon becomes a showcase of what we mean by a Green New Deal: ensuring that our skilled workers find a place in the industries of the future.