Honda Motor Co said on Friday it would further cut vehicle production in North America as it adjusts to plunging automobile demand.
Tokyo-based Honda is reducing production by another 119,000 vehicles for its fiscal year ending March 31, bringing expected production for the fiscal year to 1.3 million units.
Honda spokesman Ed Miller said the cuts will take place at five of Honda’s seven plants in the US and Canada. Employees at the plants will be given other tasks or can take paid or unpaid vacation time, he said. No layoffs will result from the cuts, he said.
Another Honda spokesman, Ron Lietzke, said production will be scaled back at the company’s engine plant in Anna, Ohio, and its transmission plant in Russells Point, Ohio.
Honda, the second-largest Japanese automaker, has been hurt by the global auto industry downturn, a product of slowing economic growth and tight credit markets around the world. Earlier this month, the automaker said its US sales fell 32 percent last month and 5 percent for the first 11 months of the year.
The company’s latest production cuts come on top of previous reductions of 56,000 vehicles for North America announced earlier in the fiscal year. Last month, Honda said it was cutting production in Japan and Europe by 61,000 vehicles.
Separately, Japanese auto giant Toyota is likely to suffer a US$1.1 billion loss for the second half of the current fiscal year because of a stronger yen and a global industry slump, news reports said yesterday.
Toyota Motor Corp is likely to incur an operating loss of some ¥100 billion (US$1.1 billion) for the six months to March next year, the Asahi Shimbun and Kyodo News said.
It would be Toyota’s first interim operating loss since the company introduced US accounting standards in 1999, Asahi said.
Last month, Toyota revised downward its net profit forecast to ¥550 billion in the current year to March, down from the ¥1.25 trillion previously projected and a decline of 68 percent from the previous year.
But the news reports said Toyota would further downgrade its sales and earnings projections as the company was battered by a sharp decline in global auto sales and the yen’s continued appreciation against the dollar.
Toyota assumed a foreign exchange rate of ¥100 against the dollar for the October to March period, but the dollar has fallen to around ¥90 due partly to concern about the future of the troubled US automakers.