Honda invests £267m in Swindon plant

Honda sign, Swindon The £267m investment reaffirms Swindon as the "cornerstone" of Honda's European operations

Japanese carmaker Honda says investment at its UK plant in Swindon has reached £267m amid plans to ramp up production.

The money will support the introduction of its new Civic and CR-V car models and a new 1.6-litre diesel engine.

The site is expected to produce 183,000 cars this year, with output forecast to rise to 250,000 within three years.

About 500 workers have been recruited this year in the firm's biggest single UK investment programme for a decade, raising the total workforce to 3,500.

Honda said Swindon remained the "cornerstone" of its European business.

Despite the expansion, many car makers in Europe are struggling with overcapacity and falling sales.

On Tuesday, Vauxhall said it was stopping production for a week from 24 September at its Ellesmere Port and Luton plants because of falling European car sales.

Vauxhall said the move would "avoid building up stock".

'Cornerstone'

Honda's Swindon factory builds cars and engines for export to more than 60 countries in Europe, the Middle East, Africa and Australia.

But Dave Hodgetts, managing director of Honda UK, told the BBC that about 40% of Swindon's production was sold in the UK.

"Sales in the UK are up about 10%, so we are in a strong position," he said. "Europe is not quite so good, but is holding up."

Business Secretary Vince Cable said: "The investment supports the government's ambition to encourage new investment and exports as a route to renewed growth and a more balanced economy."

Honda's news comes after Nissan announced in April that it would build a new hatchback at its Sunderland factory and invest £127m at the plant.

And in July, BMW said it would invest £250m in its UK factories over the next three years, principally to increase production of the Mini.

Business Secretary Vice Cable: "Honda part of the major success story of Britain's car industry"

Honda has now invested more than £1.5bn in the 370-acre Swindon site.

Mr Hodgetts said: "This investment programme underpins Honda's commitment to manufacturing in Britain and to our UK workforce.

"It reaffirms the Swindon plant's position as the cornerstone of Honda's European operations, as it has been for the past 25 years."

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