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Honda plans to restart factories

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Honda, Japan’s second-largest auto maker, plans to restart two shuttered car factories in China tomorrow after a strike at a supplier ended.

The Honda plants, in Guangzhou, Guangdong province, will reopen after being closed for two days, said Tomoko Uchida, a Honda spokeswoman in Tokyo. The car maker closed the factories because of a shortage of parts from Foshan Fengfu Autoparts Co, where workers ended a walkout last night.

 

Employees at Foshan Fengfu began striking June 7, a week after Honda raised wages 24 per cent at another parts maker to end a strike that shut down production at its four Chinese car plants. The disruptions reflect pressure for higher pay in China, where Taiwanese electronics maker Foxconn Technology Group said this week it will double salaries for its lowest-paid workers.

Wage increases for Chinese workers are “long overdue,” Huang Yasheng, a professor at the Massachusetts Institute of Technology’s Sloan School of Management, said in an interview with Bloomberg Television today. “For the last 10 years, if you look at their wage growth, it has been stagnant or very modest compared with the GDP growth,” he added.

Honda rose 0.1 per cent to close at 2,623 yen in Tokyo trading, while the Nikkei 225 Stock Average advanced 1.1 per cent.

Workers at a third Honda supplier remain on strike after walking out yesterday, the company said today.

Honda Lock (Guangdong) Co, a joint venture in Zhongshan, Guangdong, that supplies key systems, door handles and sensors for Honda’s Chinese car-making ventures, halted production at 11 am yesterday, according to Xia Gao, a Beijing-based Honda spokeswoman.

The striking employees are requesting a 72 per cent raise to $234 a month and higher overtime wages. The workers met with local government, union and company officials yesterday to discuss their demands, Gao said by phone.

The strikes at Honda and Foxconn may have triggered other walkouts. Workers at Merry Electronics Co, a Taiwanese maker of audio equipment, protested at a factory in the Chinese city of Shenzhen on June 6, demanding higher pay. The protest ended after Merry agreed to raise monthly wages 10 per cent.

About 900 workers at Brother Industries Ltd’s sewing-machine factories in Xi’an, China, have been on strike for a week demanding better working conditions, the Sankei newspaper reported today, citing the company.

The minimum wage in the cities of Foshan and Zhongshan is 920 yuan a month, compared with 1,030 yuan in Guangzhou, according to the Guangdong provincial government.

Toyota Motor Corp and Nissan Motor Co also operate car- assembly plants in Guangzhou. Toyota, the world’s biggest auto maker, builds Camry sedans and Yaris compacts at a plant in the city.

The company holds annual talks with Chinese workers in April and May to negotiate wages, said spokesman Paul Nolasco in Tokyo. The negotiations take into account changes in local prices and wage levels, he said.