Due to ongoing supply chain and logistical issues, Honda Motor Co. announced on Thursday that it will reduce automobile production by up to 40% at two Japanese plants for the remainder of September.
The reduction serves as a warning that the automakers may not be able to increase production volumes in H1 FY2023 due to the persistent chip shortage and supply chain hurdles.
Honda’s Saitama assembly plant will reduce output by approximately 40%, while two lines at its Suzuka plant will reduce output by approximately 20% in September.
It has cited COVID-19 outbreaks and semiconductor shortages as the cause of operational hiccups. The delays have affected the production of a number of vehicles including Vezel, Stepwgn, and Civic.
With these developments, Honda may also witness a decline in sales like its rival, Toyota.
Honda in Pakistan
In its latest quarterly overview, HACL foresaw a decline in car demand by up to 35 percent, citing price hikes, delivery delays, and production cuts. It claimed that 40 percent of its total sales are from consumer financing. However, that percentage will likely decline to 30 due to high-interest rates, the automaker predicted.
The automaker also blamed the State Band of Pakistan’s (SBP) new CKD clearance approval instrument as a major factor in delaying operations. The decline in sales figures has placed Honda’s market share in jeopardy.
I wish the big 3 shuts down permanently. Making way for other companies that produce better quality cars.