Honda in Swindon has announced another two month shutdown.

Three thousand workers at the South Marston plant will only receive half pay during the layoff during April and May.

This means the factory will now be closed from February until June, and Honda bosses have admitted they cannot rule out further action.

The company hopes the measures will drop its production by a further 17,000 cars in response to a worse than expected plunge in global demand.

But Dave Hodgetts, director of Honda UK Manufacturing, reiterated the company’s commitment to Swindon and to its workforce.

He said: “I think it is obvious from the actions that we have taken that we are committed to our base in Swindon. We have production of the Jazz confirmed for October and we are doing everything we can to maintain our skilled workforce.

“Honda very much has a future in Swindon. Obviously this is not an ideal situation but the European car market is not showing any signs of recovery.

“I think workers understand why we have had to take these steps.”

Mr Hodgetts explained that staff on the production line would face seven weeks of earning fifty per cent of their salary, but that when bank holidays, Easter and the first week at full pay were factored in the figure, it would be closer to sixty per cent over April and May.

The company’s associate release programme, which has already been taken up by 750 workers, will be reopened until the end of January.

The shutdown in February and March will leave employees with 250 hours which they will have to work for free when production resumes.

This is in addition to 120 hours payment which the company is gifting to the workers.

Mr Hodgetts said it was impossible to predict what would happen to the market over the following year. He said: “We strongly believe we will not have to take further measures but you can never say never and it is difficult for anyone to predict what will happen.”

Jim D’Avila, Unite’s representative in Swindon, said: “This news is not unexpected, given what is going on in the car industry, but understandably many of our members are concerned about this.

“We will be working with Honda to try to minimise the hardship for workers. We were able to come to agreements last time and we are hopeful that we can continue our good relationship with Honda.

“We will be stressing to the company that for some people 50 per cent will not even cover basic bills. We need to do all we can to help the workers.”

Shadow chancellor George Osborne, visiting Swindon yesterday, also expressed his concern. He said: “I know how important Honda is to Swindon and I’m sure there will be a lot of concerned people today.

“What big companies need, just like smaller companies, is help with credit.

“Everyone is feeling the effect of the credit crunch and they need strong leadership to ensure they can weather that storm. That means making credit available and doing all we can to ensure people are buying cars.”

BMW has said it will close its Greenbridge factory for a week in February and two weeks in August.