Honda to cut N.America output as sales keep tumbling

TOKYO (Reuters) - Honda Motor Co, Japan's No.2 automaker, said it would cut production in North America by temporarily shutting factories from next month and will reduce pay for workers as sales in the United States plunge to multi-decade lows.

Honda will shut down six factories for 13 days, starting in May, to cut production by 62,000 vehicles. Honda does not provide a production forecast, but the reduction would be equivalent to 3.4 percent of what it built in the region in the year to March.

The decision by Honda comes amid a sharp downturn in auto sales that is threatening the survival of General Motors Corp and Chrysler.

Data due out later are likely to show U.S. auto sales at the weakest monthly rates in more than 27 years.

"U.S. sales look set to fall about 40 percent in March, and there's no signs of a recovery beyond April either," said Okasan Securities analyst Yasuaki Iwamoto.

"When sales are this bad, it's natural that production is going to be weak," he said, while adding that there was no change to his view that the worst was over for production cuts after Japanese automakers made deep reductions in January-March.

JAPAN, KOREA SALES SLIDE

Sales in Asia are also suffering.