JCB is to lose another 58 jobs at its Wrexham plant as it battles the worst trading conditions in half a century.
The axe will fall at JCB Transmissions on Wrexham Industrial Estate – part of 684 redundancies across the group.
The news comes as another hammer blow to the troubled firm which has already shed 164 jobs at its twin factories in Wrexham last year.
Yesterday JCB boss David Bell told the Daily Post that the trading conditions were “the worst I have ever known”.
There are now just over 400 people left at the site and the prospect of more redundancies to come.
The site makes transmissions systems and axles for the famous JCB diggers and other vehicles.
The company blamed the latest cutback on a lack of credit available from banks to fund machine purchases and continuing low confidence. Production in the UK in the first three months of 2009 will be around three-quarters lower than at the same time last year and an anticipated upturn in the second quarter now shows no sign of materialising, said JCB.
David Bell, JCB group sales managing director, told the Daily Post in an exclusive interview last night that the grim trading conditions facing the company were unprecedented, adding: “I have been here 35 years and they are the worst I have ever known.
“The demand is still out there but nobody pays £50,000 cash out of their pocket for a machine. Virtually every sale is made through some form of hire purchase lending – but customers simple can’t get the finance for their purchases.”
Mr Bell said the company remained “committed” to its Wrexham operation but he could give no guarantees that the latest round of redundancies would be the last.
“We are committed to that site and we have put a huge amount of investment into it. But like any of our manufacturing businesses, that site has to remain fully competitive,” he said.
“It is difficult to say whether the latest cutback will be the last – I hope it is. These are good, skilled, loyal people we are losing from our Wrexham site.”
He added that there were no plans to restructure at Wrexham in order to concentrate the two factory operations onto a single site in the town.
Last night the GMB said the situation looked “extremely dire” at JCB, but would be looking at options to challenge the cuts.
Mark Jones, GMB area officer for North Wales, said it was disappointing to hear of the need for further cuts right across the group but specifically at Wrexham.
“I can’t say that people are necessarily surprised given the current economic climate. They have carried out a review and their view now is that it is going to be a very tough year, so they have cut their cloth accordingly,” he said.
Mr Jones added that he believed that the Wrexham plant was not in danger of closure, at least for the time being.
JCB chief executive Matthew Taylor said: “Back in November we forecast a moderate second quarter recovery in 2009 based on the fact that Governments around the world had pumped a huge amount of money into recapitalising financial institutions and had committed to stimulus packages which included significant spending on public construction projects.
“Two months later, despite the recapitalisation, customers are still struggling to buy machines because of a lack of available credit. And with Government-funded construction projects not moving forward quickly enough, this means the anticipated second quarter recovery simply won’t happen.”
Mr Taylor added: “The ongoing reluctance of the banks to provide credit is aggravating an economic downturn which is now becoming much steeper than we could have ever envisaged.”
Last October GMB members working at JCB voted for a shorter, 34-hour working week, a move which continues to protect a further 332 shopfloor jobs, said the company.