Car parts sector braces itself as GKN wields job axe
Jan 29 2009 by Jon Griffin, Birmingham Post
Hundreds of West Midland workers are bracing themselves for the worst as GKN prepares to wield the axe in the latest body blow to the region’s manufacturing base.
The engineering giant announced it had axed 242 jobs and planned further cuts this year because of the downturn in the car industry.
The firm, which employs about 6,400 workers in the UK, including 2,000 in its automotive component sector, said further restructuring would take place in 2009, including job cuts.
The anticipated cuts could threaten jobs at the group’s four West Midland factories at Erdington, Great Barr, Walsall and Telford.
The programme remains under review as the market outlook is uncertain, but GKN said it would include “significant” short-time working, plant shutdowns, selected headcount reduction and further structural rationalisation.
GKN, which supplies components to car factories across the UK, said that since last October it had cut about 2,800 jobs from its workforce globally, including temporary, agency and permanent employees. Short-time working arrangements had been negotiated and implemented worldwide.
About 360 jobs had been cut in the UK, including 130 permanent staff and 230 temporary workers.
The company said all GKN’s automotive plants were working short-time and had implemented extra shutdown periods throughout the last two months of 2008.
The firm reported that conditions in global automotive markets had continued to deteriorate since November, with activity levels for the last two months of the year down by almost a third.
The automotive business was loss-making in both November and December, it said.
GMB union official Joe Morgan said: “This is another body blow for an already beleaguered industry.
“We need to discuss the implications of this on a plant-by-plant basis and see if there is any scope for government assistance.”
Elsewhere about 60 West Midland jobs have been shed with the collapse into administration of a long-established parts supplier to Jaguar Land Rover.
Falling orders have led to administrators being called in to Stafford Rubber Company, based in Norton Canes and founded in 1975.
Ian Gould and Brian Hamblin, corporate recovery partners at the Birmingham office of PKF accountants & business advisers, have been appointed administrators.
The Staffordshire firm makes foam inserts for automotive products, including car door interiors. Sixty of the 80 workers have been made redundant.
The stricken firm’s main customers – including JLR – are spread across the automotive sector.Mr Gould said Stafford Rubber’s troubles followed a fall-off in orders and were directly related to the car industry’s current woes.
He said the future of the business largely depended on discussions with major customers, including Jaguar Land Rover. A decision is expected this week.
