Japan’s Honda Motor Co said yesterday it was cutting more than 3,000 jobs at home and reducing domestic production because of a slump in demand due to the economic downturn.
The country’s second-biggest automaker will reduce its output by 56,000 vehicles for the rest of the financial year to March, lowering domestic production to 1.168 million vehicles, down 10 percent from the previous year.
Honda said it would not renew contracts with 3,100 temporary workers in Japan by the end of April.
The latest cutbacks are in response to “a rapid change in the global market environment,” the company said in a statement.
Last month, Honda had already said it planned to cut domestic production by 54,000 cars and would hold off on the release in Japan of the Acura luxury brand, which was planned for next year.
Honda last month cut its full-year net profit forecast by more than half due to a soaring yen and the global economic slowdown. It also announced its shock pullout from Formula One because of financial difficulties.
Japanese manufacturers have expanded rapidly in recent years to meet brisk demand for their smaller, fuel-efficient cars, but they have not been immune to the economic downturn.
Other makers including Toyota and Nissan are also cutting jobs and production.
Yesterday, the Nikkei business daily said Nissan Motor Co plans to transfer production of its key subcompact car from Japan to Thailand, where costs are lower.
Japan’s third-largest automaker is redesigning its popular March supermini car jointly with its French partner Renault SA, hoping to appeal to customers looking for fuel-efficient cars.
The Nikkei said Nissan has decided to shift all Japanese production of the car to Thailand next year and then export it back to Japan.