2,300 jobs go as car plant closes
April 18, 2006
Peugeot is to close its plant at Ryton near Coventry with the loss of 2,300 jobs, it has been announced.
The plant is to cease production in mid-2007.
Union officials were called to a meeting with the firm's chief executive, who is thought to have flown in from France, at lunchtime.
In February, the government said it was working to secure the future of the Warwickshire car factory after the company announced a drop in profits.
Jean Martin Folz, chief executive of Peugeot Citroen, said a study had been carried out during the beginning of 2006 showing the Ryton plant had high production and logistical costs.
This meant the group was unable to justify the investment needed for the production of future vehicles.
Two phases
This and reduced demand and intense competition in Europe meant the company had come to come to this "difficult conclusion", he said.
The Ryton plant produces the Peugeot 206 model and operates on a two-shift system.
Production will be stopped in two phases by moving to a single shift in July 2006 and then halting production completely in mid-2007.
The company is now entering into consultation with the trade unions.
A statement said it was committed to its social responsibilities and will work closely with unions and the government to provide a "comprehensive" support package for staff and to help as many as possible find alternative employment.
'Feared bad news'
Unions said they had been fearing bad news but were shocked at the scale of the announcement.
Thousands of other jobs depend on the Ryton factory.
The decision is another blow to the West Midlands car industry following last year's collapse of MG Rover at Longbridge, Birmingham and the loss of nearly 6,000 jobs.
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