Ford to close Welsh engine plant
US car giant Ford Motor Co is to close its factory in South Wales, with the loss of around 1,700 jobs.
Unite, the union, said shutting the Bridgend site - which has been producing engines for around 40 - would take an "economic sledgehammer" to the Welsh economy and wider car industry.
In a statement, Ford confirmed multiple reports that it would cease production during 2020. The Guardian said that workers at the site, which makes the Dragon petrol engine used in a range of models, had been told earlier in the morning.
The US company added that it would cost around $650m to close the plant, around $400m of which would cover "separation and termination payments" for staff. Consultation with employees will now get underway.
Ford is battling a slowdown in global sales, and last month chief executive Jim Hackett told staff he was looking to eliminate around 10% of the global workforce, around 7,000 jobs, as part of a world-wide cost-cutting programme. He also outlined plans to streamline management and reduce bureaucracy.
Ford said Bridgend has been hit by the loss of contract work for Jaguar Land Rover and falling demand globally for the Dragon engine. Stuart Rowley, president of Ford in Europe, said the company had explored various options but failed to find one that would enable the site to remain open.
However, Unite assistant general secretary Steve Turner argued that Ford should focus on "rebalancing global engine production from Mexico and India" to Bridgend.
He added: "The UK is Ford’s biggest European market, it holds first and second place in UK car sales, yet disgracefully doesn’t produce a single vehicle here. If Ford wants to sell vehicles in this country, it has a responsibility to maintain a strong manufacturing footprint here, not run off into the sunset to cheaper markets were sales are low but profits high."
As well as Bridgend in South Wales, Ford has two other UK factories. Its plant in Dagenham, east London, produces diesel engines, while its Halewood site near Liverpool makes transmissions. The parts are then shipped to factories worldwide.
Unite said it would ballot for industrial action.
The Bridgend site employs around 17,500 people, though it is understood jobs in the supply chain could also be put at risk by the factory’s closure.
Ford is one of a number of car makers struggling with shifts in the global market and falling demand. The industry has also warned that Brexit risks interrupting the seamless flow of components and engines across Europe that car makers rely on.
In February, Honda announced plans to shut a plant in Swindon in 2021 while Nissan has reversed plans to build the X-Trail at its Sunderland site.
Ian Price, Wales director at the CBI, said: "The planned closure of Ford’s Bridgend plant is a blow to the lives of all who work there and in its supply chains, as well as to the Welsh economy.
"The Welsh government and Westminster must do all in its power to sustain manufacturing in our country, and to support industries under threat from a range of challenges, from automation to a slowing global economy."