TOKYO (AFP) - Japan's Honda Motor Co. said Friday it was cutting more than 3,000 jobs at home and reducing domestic production because of a slump in demand due to the economic downturn.

The country's number two automaker will reduce its output by 56,000 vehicles for the rest of the financial year to March, lowering domestic production to 1.168 million vehicles, down 10 percent from the previous year.

Honda said it would not renew contracts with 3,100 temporary workers in Japan by the end of April.

The latest cutbacks are in response to "a rapid change in the global market environment," the company said in a statement.

In December, Honda had already said it planned to cut domestic production by 54,000 cars and would hold off on the release in Japan of the Acura luxury brand, which was planned for 2010.

Honda last month cut its full-year net profit forecast by more than half due to a soaring yen and the global economic slowdown. It also announced its shock pullout from Formula One because of financial difficulties.

Japanese manufacturers have expanded rapidly in recent years to meet brisk demand for their smaller, fuel-efficient cars, but they have not been immune to the economic downturn. Other makers including Toyota and Nissan are also cutting jobs and production.