As many as 2,000 workers are expected to be negatively affected by the decision by the Philippine unit of Honda Motor Co. to stop local production, the country's biggest labor coalition said.
Alan Tanjusay, spokesman for the Trade Union Congress of the Philippines, said Monday that on top of Honda Car Philippines' almost 400 regular employees, many more at parts suppliers will be thrown out of work.
"The bigger problem is the 1,000 to 2,000 endo (end-of-contract) and contractual workers who work in six Honda parts suppliers," Tanjusay said, saying they will receive no back pay or separation benefits.
"We have sent our lawyers there," he added, saying the organization has offered assistance and legal help to people who will be affected.
The Philippine Department of Trade and Industry has decided to step forward to help, meeting with company executives to discuss alternatives and how to minimize the negative impact.
"The cost structure of their local car assembly, which has about 380 workers, is basically challenged and there's no tariff protection, thus making imports of vehicles as a cheaper alternative," it said.
Over the weekend, Honda Cars Philippines announced it will halt production operations in March, citing the need for "efficient allocation and distribution of resources."
A partnership between Honda Motor Co. and local entities AC Industrial Holdings Inc. and Rizal Commercial Banking Corp., Honda Car Philippines was established in November 1990.
Its assembly line south of Manila makes the Honda City sedan and BR-V sport utility vehicle.