Toyota Cuts Pay and Production of Cars in the UK

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As the recession continues around the globe, once again UK has been hit by another blow of car industry. It was announced today that Toyota will cut pay and production in its British factories by 10% during the year 2009.

This will affect approximately 4,000 employees currently working in Toyota’s two factories based in the UK, in Burnaston near Derby and in Deeside, Flintshire. The cut will start in April and it seems that Union is supporting Toyota’s decision.

In a statement to The Guardian Mr, Peter Tsouvallaris said: “Any decision to cut wages and working time is never taken lightly but the agreement we have reached with Toyota will ensure none of our members’ benefits are eroded and that these skilled workers will remain in place and at work ready for when the upturn comes.”

UK motoring industry has been hit extremely hard in the recent economic meltdown, BMW cut 850 posts in its factory in Oxford. And it wasn’t the only motoring company, which had taken the move to reduce the number of its employees. Other well-known carmaker companies such as Nissan have announced that it will cut 1,200 jobs while Honda is suspending its car production factories in the UK for some weeks if not months.

According to The Guardian newspaper, Toyota has said that the decision will help to secure long-term employment in the UK. “There had been fears that the workforce could be put on a three-day week or even be laid off for several months.  In a statement, the Japanese car company said that “the measures we have announced give us a greater opportunity to maintain employment through this difficult period”. Toyota cuts UK Pay and Output by 10%

Government officials and businessmen are meeting in London today to discuss to how the government can support the motoring industry to get access to £2.3bn recues plan, which was announced by the Prime Minister Gordon Brown in January. The £2.3bn has already been approved by the European Union recently, but it is yet to be allocated.

“The Society of Motor Manufacturers and Traders warned last week that the government needs to move faster to help the industry. Carmakers also want Britain to introduce a programme to encourage people to scrap their cars and buy newer ones. Environmental campaigners, though, say that such schemes are largely a waste of public money that could be used for much greater environmental gains.” Toyota cuts UK Pay and Output by 10%