Hopes have been raised that Honda’s Swindon plant could be saved after reports that BMW is interested in taking over the factory when the Japanese manufacturer leaves in 2021.
Honda last month announced that it would cease production in Swindon in 2021, dealing a major blow to a British car industry that already faces an uncertain future over Brexit. However, the availability of a ready-made plant could prove attractive to buyers if the UK maintains a stable trading relationship with the EU. Honda employs 3,500 people in Swindon, all of whom are expected to lose their jobs in 2021.
BMW has been eyeing the plant for several weeks, although it is not thought that a decision will be made until well after the status of the future UK-EU trading relationship is confirmed.
“There’s been some interest for some time,” a source with knowledge of BMW’s thinking told the Guardian. “It is something that is being looked at.”
The potential move was first reported by the industry publication Autocar, which said BMW was considering the transfer of more production to the UK because of strong demand for its X1 sports utility vehicle.
BMW employs the majority of its 8,600 UK manufacturing workers in the same region, with 5,000 in Oxford making Minis and another 800 in Swindon, who manufacture pressed metal parts. The German carmaker has already obtained planning permission to expand its existing Swindon plant.
The Unite trade union and the government are understood to be focusing their lobbying efforts on persuading Honda to U-turn on its decision and keep production in Swindon, rather than pushing for a buyer to take over the plant.
BMW denied that there were any plans in place. A spokesman said: “There are currently no plans for additional plant locations in the UK.”
A move to save the jobs at Swindon would represent further good news for the industry, following Toyota and Suzuki’s agreement to build a new hybrid vehicle at Toyota’s Burnaston plant in Derbyshire.
The agreement with Suzuki is expected to help sustain the jobs of the 3,000-strong workforce at Burnaston, despite warnings that Brexit could imperil the future of Toyota’s UK production. Johan van Zyl, Toyota’s European chief executive, warned this month that he could not guarantee that British jobs were safe until the longer-term trading relationship was decided.
Carmakers are particularly afraid of a no-deal Brexit, under which trade would default to World Trade Organization terms. A chaotic exit from the EU would cause major disruption at the border, according to government analysis, while tariffs on imports would impose longer-term damage.
Multiple carmakers are thought to be awaiting the outcome of Brexit negotiations before making decisions on investment, including the Vauxhall owner, the PSA Group, which is due to make a decision on the future of the Ellesmere Port plant.
However, a senior BMW executive indicated last week that the German manufacturer believes it can cope with a no-deal scenario. BMW’s production chief, Oliver Zipse, said it would take “significantly more severe developments” for the carmaker to change its production plans for the UK, according to Bloomberg. Zipse also told Bloomberg that disruption from a no-deal Brexit could be cleared after six weeks.
On the possible BMW move for Swindon, the source said: “There will be no decision until the Brexit miasma is clear.”