Sunday, April 21, 2024
HomeNEWSINTERNATIONALCOVID-19 PUNISHMENT AWAITS HONDA

COVID-19 PUNISHMENT AWAITS HONDA

Honda was clearly quite aware there was no room for smugness, when releasing generally coronavirus-free motorcycle division results for its 2019/2020 fiscal year. Essentially, the serious commercial pain began to kick-in just as that period wobbled to a close — with no certain end in sight. BDN financial editor Roger Willis reports.

The precursor had been a fortnight of obligatory shutdown for Chinese joint-venture affiliate Sundiro Honda’s two factories in February. Next to go was the Tanauan City assembly plant in the Philippines, which ceased production on 17 March. Malaysian JV partner Oriental then locked its gates on 18 March. Both fielded putative re-opening dates in mid-May.

Honda’s massive wholly-owned Indian subsidiary was the first really big operation to hit the Covid-19 buffers, furloughing all employees and shutting down plants on 23 March, without any scheduled date for resuming production. The Atlas Honda JV in adjacent Pakistan followed suit on 24 March. Honda USA closed its North American ATV plant on 26 March. And the major Honda facility at Manaus in Brazil, which feeds the Brazilian bike market directly plus also churning out CKD component kits for assembly in a host of other Latin-American countries, suspended production on 27 March.

Honda motorcycle manufacturing in Vietnam ground to a halt on 1 April but was permitted to resume on 22 April. Meanwhile, Indonesian JV Astra Honda, the biggest of its ilk in Honda’s camp, was required to put up the shutters on 15 April.

Honda Thailand is the only large facility to have escaped compulsory closure, without any downtime thus far. But myriad Honda plants, with a combined annual production capacity of about 15 million bikes, are now lying idle.

The company qualified outcomes for the past year with an inevitable statement: “Under these circumstances, it is difficult to predict when Covid-19 will subside and how situations in each country and region will develop. So the market trends and economic conditions are expected to remain uncertain. Therefore Honda is currently unable to provide a reasonably calculated forecast of financial results for the fiscal year ending on 31 March 2021.”      

RELATED ARTICLES

Product News

Zapp secures investment

UK-based electric urban mobility firm Zapp has announced a new cash injection, which it says will allow production and roll-out of its new i300...