Ford’s engine plant in Bridgend will close in September 2020, union sources have said, with the loss of 1,700 jobs.
Union officials are being told details of the plans at a meeting with Ford bosses which include the offer of redeployment of workers to other sites.
The company is understood to be blaming “under utilisation” and cost disadvantage compared with other sites.
Ford will make an official announcement later, with workers arriving at the plant saying they were “devastated”.
The plant employs workers from across south Wales and many more in companies supplying goods and services to it. The GMB union said closure would “mean disaster” for the community.
Tony Phillips, who has been at the plant for 31 years, said: “I’m expecting to lose my job this morning.”
He added: “These are good, well-paid jobs.”
Fellow worker Mark Lendrum said he was “devastated”, adding: “South Wales is going to be like a ghost town.”
The closure news comes just months after Ford said it was cutting its Welsh workforce by 1,000, with 370 going in a first phase.
Investment in the new Dragon engine was scaled back, while production of an engine for Jaguar Land Rover is due to end this year.
There has already been concern about whether the plant would be viable making only 125,000 Dragon petrol engines a year.
It comes just days after car sales in the UK fell again and the BBC expects Ford to be in touch with Welsh Government ministers over their plans.
It is understood the meeting in Essex has been called in the past 24 hours and senior managers from Ford in the United States will be present, as well as union leaders from the company’s other UK sites.
GMB regional organiser Jeff Beck said: “It will mean disaster for both our members in Bridgend and the community at large.”
Plaid Cymru leader Adam Price said closure would be “one of the most bitter blows” for the Welsh economy for more than 30 years.
“Ford is the jewel in the crown of the car industry – which is the hardcore of our manufacturing sector – so the implications of this in terms of the supply chain in terms of job losses is very, very grave indeed.”
How Ford came to Bridgend
Ford chose Bridgend for its new engine plant in the summer of 1977 after competition from elsewhere in Europe, chiefly from Ireland.
The company needed an engine for its new model – code-named Erika – which became the next generation Ford Escort, and would be built at Halewood on Merseyside and at Saarlouis in Germany from 1980.
The promise was 2,500 jobs but, by the time it opened in May 1980, Ford had decided to take on only 1,400 workers with 22,000 people applying for the roles.
Concerns about the plant’s long term future were raised more than a decade ago when the decision was taken to no longer having Ford UK and Ford Europe making different designs of cars compared with the USA and rest of the world.
What support will workers have?
Welsh Secretary Alun Cairns said the automotive sector was going through a period of structural change towards electric vehicles and that he had been in touch with Welsh Economy Minister Ken Skates.
“We’re determined to do what we can to protect the future employment in that area in this exciting sector,” he added.
Mr Skates said the Welsh Government would provide a “rapid response taskforce to support workers”.
He said: “There has been a lot of speculation over the future of Ford for some time now and, during that period, the Welsh Government has been in discussions with the UK government in attempting to capture alternate employment and to land some major projects in Bridgend.”
Since 1978 about £140m in taxpayers’ money has been invested in the plant, he said.
“That has been money well spent because, just in the last decade alone, £3bn has been pumped back into the Bridgend economy by the Ford plant.
“What we have repeatedly said to Ford over recent months and years is that Wales stands ready, it is perfectly situated and positioned to help businesses,” he said.
2008: Ford announces it will operate as a single global company – meaning its Bridgend engine plant had to compete with the firm’s other factories across the world, not just in Europe
2015: Bridgend secures investment for Dragon petrol engine project – with 250,000 engines a year, although it has capacity for 750,000 a year
2016: The planned Dragon investment is reduced to £121m and the number of engines is cut in half to 125,000
2017: Ford projects a reduction of 1,160 workers by 2021 and confirms production of Jaguar Land Rover engines – which involves half the workforce – will end in 2020
2018: Workers making Jaguar engines face a five-day shutdown as a knock-on effect from JLR’s temporary production halt. Ford’s European boss warns a no-deal Brexit would be “pretty disastrous”
2019: Ford plans to cut 370 jobs the first phase of redundancies which will total 990 by 2021. The Dragon project is scheduled to employ about 500
What’s happening to the car industry?
Several car companies with UK factories have recently announced significant changes:
- Honda confirmed in February its Swindon plant will close in 2021, with the loss of about 3,500 jobs which it said was due to global changes in the car industry
- In the same month, Nissan chose Japan over the UK to build the new X-trail car, a decision thought to be driven by falling diesel car sales in Europe, post-Brexit concerns, and an EU-Japan trade deal which will reduce tariffs on cars imported from Japan
- In January, Jaguar Land Rover (JLR) confirmed it was cutting 4,500 jobs, with the substantial majority coming from its 40,000 strong UK workforce, due to a slump in demand for diesel cars and a sales slowdown in China. It also complained about uncertainty caused by Brexit.
- In April, JLR said it will build its next-generation Land Rover Defender 4×4 in Slovakia rather than the UK
The car industry’s problems have been blamed, in part, “because the trade future is uncertain with Brexit,” according to consultant Anne-Marie Blaisden.
There is a “very difficult business backdrop” for car makers to negotiate, said the head of autos research for Fitch Solutions.
But she said there had also been a “shift away from what is being made at the moment, in terms of diesel cars”.
“It takes a lot of investment so they have to think years in advance about whether they’ve got the supply chain, whether they’ve got the skills.”