The consolidation of Honda’s production landscape continues, with the automaker announcing Tuesday that it will cease production of passenger vehicles in Argentina next year. Honda builds the subcompact HR-V at its Campana assembly plant; come 2020, the facility will revert back to building only motorcycles.
It’s just the latest move by an automaker eager to bolster its bottom line and build defences against a possible recession by streamlining its operations on a global scale. Like other companies, Honda is eager to rid itself of excess plant capacity and source vehicles from cost-effective locales.
After setting up shop in the country in 2006, Hondas began building passenger vehicles in 2011. The HR-V exists in a competitive segment, as subcompact CUVs are growing in popularity in the Latin American region.
Earlier this year, Honda announced it would end vehicle assembly in the UK and Turkey in 2021, with that region’s supply of Civic coming instead from North America. Earlier this month, the automaker lifted off the throttle on U.S. Civic and Accord production to match output with anticipated demand. The shift that disappeared from its Marysville, Ohio plant will likely return once the European plants close up ashop.
Honda’s Campana plant employs approximately 1,050 workers, with Telesur reporting that the local union is in talks with Honda to offer a buyout to employees. The timing of Tuesday’s announcement is suspect, given that it’s just two days after Argentinians voted for a change in government. The election of a leftist government led by Alberto Fernandez led to a steep currency and stock slide.
In response to media questioning, Honda stated that the election had nothing to do with the decision. Rather, the automaker said the announcement was part of its “global reorganization of auto production,” Reuters reported.