The Japanese carmaker, which employs 3,500 people in the UK, is thought to be planning to shut the Swindon plant, its only factory in Europe, from 2022.
It is expected to move production back to Japan, partly because it can guarantee tariff-free exports to the EU, according to Sky News.
Honda has yet to confirm the plans but Justin Tomlinson, the North Swindon Conservative MP whose constituency includes the plant, said he had spoken to the company and insisted its decision was “due to global trends and not Brexit”.
Japan’s ambassador warned last year that the UK would not find a better trade deal than being within the European single market, while the EU and Japan signed the world’s biggest ever free-trade agreement last year. It came into force at the start of this month, sparking concern that British businesses could lose out as a result.
If Honda does list Brexit among the factors in its decision, it would become the latest in a long line of carmakers either to warn about dangers of a no-deal scenario, or cite the UK’s departure from the EU when making job cuts.
Britain’s largest trade union Unite said the closure of the Swindon plant would be a “shattering body blow at the heart of UK manufacturing”.
Des Quinn, the union’s national officer for the automotive sector, called for an urgent statement from business minister Greg Clark.
“The car industry in the UK over the last two decades has been the jewel in the crown for the manufacturing sector – and now it has been brought low by the chaotic Brexit uncertainty created by the rigid approach adopted by prime minister Theresa May,” he said.