Is 2013 the Year of Turmoil in the Auto Industry

In Late October 2012, Ford announced the closing of its plants in Southampton and Dagenham. Combined the two closures will see 1400 jobs lost including logistics and support jobs.

Now, we have more bad news from Honda here, and Fiat, Renault and PSA in Europe. Doesn’t look like a good start for the auto industry in 2013, no matter how rosy some say it is. Everyone is finger pointing at the sales slump in Europe, and sales are down there. However other markets are increasing demand.

Honda cuts 800 jobs in sales slump

Staff at Honda’s Swindon plant were told about job cuts as they arrived for work on last Friday morning. Japanese car giant Honda is to cut 800 jobs at its UK factory just months after taking on hundreds of extra workers because of an expected increase in demand.

The firm blamed a slump in sales across Europe, especially in countries hit by the eurozone crisis including Spain, Greece and Italy. Honda said it was the first time it had cut jobs in the UK since it started making cars in Swindon in 1992, adding that demand for cars in Europe had fallen by a million in the past year.

Unite said the job cuts at the plant in Swindon were a “hammer blow” to manufacturing, warning of a huge knock-on impact on jobs in supply firms. Workers at the plant, which employs 3,500, were told the grim news as they arrived for their shifts on Friday morning.

Renault aims to cut 7,500 posts in France by 2016

Renault wants to cut 7,500 posts in France by 2016 to help boost competitiveness as its domestic and European markets continue to slump, a spokeswoman for the French carmaker said.

The cuts, equivalent to 14 percent of French Renault staff, are expected to include 5,700 departures through natural turnover, the spokeswoman said on Tuesday, following the latest in a series of meetings with unions.

Fiat plans layoffs to ready Melfi plant for new models

Fiat has asked the government to approve a special layoff scheme at its Melfi plant in central Italy for two years to restructure the factory before production of new models begins, the carmaker said on Tuesday.

The scheme will kick off on Feb. 11 and last until the end of 2014. It will allow the company to stop one line at a time out of two at the plant, Fiat said.

Melfi, one of Fiat’s most important facilities in Italy, currently manufactures the Punto subcompact.

PSA secures 5.3 billion euros to shore up bank arm

PSA/Peugeot-Citroen said its banking unit completed about 5.3 billion euros ($7.1 billion) in loan agreements as part of a refinancing plan aimed at stemming a sales decline.

The Banque PSA Finance division signed a 4.1 billion-euro five-year term loan and extended a 1.2 billion-euro revolving credit line to January 2016, PSA said in a statement today. The five-year loan was oversubscribed, and 18 banks from eight countries took part.

PSA is shoring up Banque PSA Finance as Moody’s Investors Service considers cutting the unit’s credit rating to junk because of slumping car sales.