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Honda has confirmed plans to axe its only EU factory after rumours started to swirl of a potential closure on Monday .

The automotive giant first said it would shut its Swindon factory in February, but has been in discussions with unions, the UK Government and external consultants since then.

It's now confirmed that the carmaker will close shop in the UK in 2021.

"The decision to close the plant is part of Honda's broader global strategy in response to changes to the automotive industry," the company said in a statement.

"As previously communicated in February, Honda is accelerating its electrification plans, and as a result resources, capabilities and production systems for electrified vehicles will be focused in regions with a high volume of customer demand."

The move will place 3,500 jobs at risk, however, its closure is likely to impact more than 12,500 jobs in the plant’s supply chain, plus other businesses that are reliant on the ­factory’s workforce.

(Image: Getty Images)

The company will now move to discuss redundancy packages and look at the impact on individual roles up until production ends.

Honda director Jason Smith, said: "It is with a heavy heart that today we confirm the closure of Honda's factory in Swindon.

"We understand the impact this decision has on our associates, suppliers and the wider community.

"We are committed to continuing to support them throughout the next phases of the consultation process."

The company has said it will retain its European headquarters in Bracknell, Berkshire, as well as its Formula One racing team operations in the UK.

In a press conference in February, Honda said: "This proposal comes as Honda accelerates its commitment to electrified cars, in response to the unprecedented changes in the global automotive industry.

"The significant challenges of electrification will see Honda revise its global manufacturing operations, and focus activity in regions where it expects to have high production volumes."

(Image: Getty Images)

Katsushi Inoue, Honda's chief officer for European regional operations and president of Honda Motor Europe, said in February: "In light of the unprecedented changes that are affecting our industry, it is vital that we accelerate our electrification strategy and restructure our global operations accordingly.

"As a result, we have had to take this difficult decision to consult our workforce on how we might prepare our manufacturing network for the future. This has not been taken lightly and we deeply regret how unsettling today's announcement will be for our people."

Honda's senior vice-president Ian Howell told BBC's Radio 4 Today programme: "This is not a Brexit-related decision for us."

Honda produces more than 150,000 cars a year at Swindon - around 90% of which are exported to Europe and the US.

Unite national officer Des Quinn said: "We await the detailed reasons from Honda, but Unite believes that our alternative case to keep Honda Swindon open added up and was likely to be backed by the Government with public money.

"It would have made Honda a global leader in emerging battery technology and in a strong position to exploit the growing global market for electric vehicles in the coming years.

"Instead we have this body blow which is nothing short of a betrayal of the workforce, customers and the wider supply chain which relies on Honda Swindon for work.

"Unite can only conclude that Honda is taking a strategic decision to retreat out of Europe in favour of protecting its North American operations and avoiding president Trump's tariff threat on cars made in Europe.

"Unite will be consulting with its members on our next steps in the coming days."

Business Secretary Greg Clark said: “Having chaired the initial Honda Swindon Taskforce meeting, I am clearly disappointed that the outcome of Honda’s consultation is to close the Swindon plant – despite the best efforts of civic and business leaders as well as trade union representatives and Honda UK workers.

“As the company starts the next phase of its consultation, they have stated they will continue to work with the Honda Swindon Taskforce.

“We will ensure everything is being done to support those affected and to continue Swindon’s record of attracting investment to create highly-skilled jobs that offer fulfilling careers for years to come.”