Honda Plans to Shut Down North American Plants for Six Days Due to Virus Concerns, Demand Decline -- Update
18 Marzo 2020 - 09:11AM
Noticias Dow Jones
By Christina Rogers
Honda Motor Co. said Wednesday it will temporarily close about a
dozen factories in the U.S., Canada and Mexico for six days to
respond to concerns about the rapidly spreading virus and in
anticipation of lower consumer demand.
The Japanese auto maker will suspend production at these plants,
which include those that assemble vehicles as well as build engines
and transmissions, starting Monday -- a move that will affect
27,600 jobs, the company said.
Honda said all impacted employees will be paid during the
downtime, which it anticipates will reduce factory output by about
40,000 vehicles.
The action marks the first time a major auto maker has initiated
a region-wide shut down of its factories in North America to
mitigate the impact of the outbreak.
In Europe, most global car companies have temporarily suspended
work at their plants, and on Tuesday, Ford Motor Co. said it will
have to close its Chicago plant for a short period of time due to a
parts shortage.
Car dealers tend to carry a few months of stock, so a temporary
shutdown isn't expected to have an immediate impact on consumer
choices. But over time, it could lead to shortages of certain
models and replacement parts for fixing vehicles.
At the end of February, Honda lots were well stocked with
vehicles, carrying a nearly three months' supply, according to
Wards Intelligence.
The Detroit car companies have also been under pressure to
suspend work at U.S. plants.
Earlier this week, leaders at the United Auto Workers union
asked Ford, General Motors Co. and Fiat Chrysler Automobiles NV for
a two-week shutdown of U.S. manufacturing facilities to prevent the
spread of the virus among workers.
Late Tuesday, union leaders and company executives struck a deal
to keep the plants open by taking other preventative steps,
including partial shutdowns of the assembly lines to allow for deep
cleaning.
In recent days, analysts have sharply cut their sales forecasts
for the U.S. auto industry, anticipating consumer demand will drop
as large parts of society shut down and the pandemic continues to
dent economic activity, potentially pushing the U.S. into a
recession.
José Muñoz, chief executive of Hyundai Motor Co.'s North
American division, said in an interview Tuesday that he expected
companies to cut production accordingly.
"You don't want to produce cars you can't sell," Mr. Muñoz
said.
Write to Christina Rogers at christina.rogers@wsj.com
(END) Dow Jones Newswires
March 18, 2020 10:56 ET (14:56 GMT)
Copyright (c) 2020 Dow Jones & Company, Inc.
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