Ford to close Wales engine plant in latest blow to UK car sector


Ford to close Wales engine plant in latest blow to UK car sector
The Ford logo is seen at the North American International Auto Show in Detroit, Michigan, U.S., January 15, 2019. REUTERS/Brendan McDermid

In Summary

  • Ford is making cuts in several markets to turn around loss-making operations and has also repeatedly warned the British government that it needs free trade to be maintained with the European Union after Brexit.
  • The Bridgend plant built around 20 per cent of Britain’s 2.7 million automotive engines last year. Britain’s biggest trade union vowed to fight the move.
  • Britain’s once-thriving car sector, rebuilt since the 1980s mainly by foreign carmakers, has been suffered slumps in sales, output and investment over the past two years.
  • A series of investment decisions are also pending, including whether Peugeot parent PSA will keep its Ellesmere Port plant open and if JLR will make electric cars in Britain.

Ford said it would close its plant in Bridgend, South Wales, next year because of falling demand for some of its engines, putting 1,700 jobs at risk in a further blow to Britain’s once-booming car industry.

Ford is making cuts in several markets to turn around loss-making operations and has also repeatedly warned the British government that it needs free trade to be maintained with the European Union after Brexit.

Production of Ford’s 1.5-litre petrol engine will end in February, whilst a contract to supply Jaguar Land Rover (JLR) finishes in September 2020, the U.S. automaker said on Thursday.

“Changing customer demand and cost disadvantages, plus an absence of additional engine models for Bridgend going forward make the plant economically unsustainable in the years ahead,” said Ford Europe President Stuart Rowley.

The Bridgend plant built around 20 per cent of Britain’s 2.7 million automotive engines last year.

Ford operates two factories in Britain making engines, which are exported for fitting in vehicles in Germany, Turkey, the United States and elsewhere. They could face delays and extra costs if Britain leaves the European Union without securing a deal with the EU.

Britain’s biggest trade union vowed to fight the move.

“We will resist this closure with all our might, and call upon the governments at the Welsh Assembly and Westminster to join us to save this plant,” said Len McCluskey, head of the Unite union.

Britain’s once-thriving car sector, rebuilt since the 1980s mainly by foreign carmakers, has been suffered slumps in sales, output and investment over the past two years.

Ford said in January a turnaround of its European operations would involve cutting thousands of jobs, possible plant closures and discontinuing loss-making vehicle lines.

Workers have long pushed for Bridgend to produce hybrid technology and electric vehicle components alongside a new third-party manufacturer to fill any surplus space but such investment has not been forthcoming.

“Significant efforts to identify new opportunities have not been successful,” said Ford.

The announcement is the latest blow to the sector this year after JLR announced around 4,500 job cuts mainly in Britain, and Honda said up to 3,500 roles would go when it closes its British plant in 2021, in the biggest blow to the sector so far.

A series of investment decisions are also pending, including whether Peugeot parent PSA will keep its Ellesmere Port plant open and if JLR will make electric cars in Britain.

 

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