Honda Considering Moving Headquarters Outside Japan

Although we're getting used to reports regarding the victims of the global economic crisis, today's news is a bit different, with Japanese manufacturer Honda threatening the local government that it may leave the country in case officials do not counteract the recession. In other words, Honda says that it may apply a series of cost-cutting measures and might even stop operations in Japan should the government fail to take action against the continuously declining yen value.

According to Japan Probe, Honda's plan to reduce consequences of the crisis include moving production to overseas plants, firing temporary workers and even cutting permanent jobs. Moving the company's headquarters overseas is an “extreme scenario”, but it may prove to be the only solution in case the government does not show support.

“If the government is saying, ‘We don’t care about the export industry’, then that’s fine — we’ll act accordingly,” Chief Executive Takeo Fukui was quoted as saying by Reuters. “If we go beyond (100 yen), we would simply have to transfer more production overseas, cut more temporary workers and even start laying off permanent jobs.”

“Beyond that we could switch to importing more cars into Japan, bring research and development facilities overseas, and in an extreme scenario move our headquarters offshore. It would cause nothing short of a hollowing out of Japanese industry.”

Moreover, Honda's official says the automaker is not interested in forming an alliance with smaller companies that could help it expand its offering onto specific markets because “at this point, I don't think there's any need or advantage for us.”

"In fact, there are risks involved in boosting volumes that way, because the partner could bail at any point, and it's also not good for Honda's dealers,” Takeo Fukui concluded.