GKN to close body plant: Venture's closure follows defection by Jaguar and will cost 200 jobs

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GKN, the car components and engineering group, is to close its joint venture body pressing plant, at Telford, in Shropshire, with the loss of 200 jobs. The closure follows a decision by the other partner, Jaguar, to buy body pressings from the Halewood plant run by its parent, Ford.

Venture Pressings was set up several years ago when Jaguar was a private company. The luxury car maker was the only customer for VP's plant.

The company was regarded as a trailblazer in its approach to 'human resource management'. All members of staff, whether from the shop floor or the boardroom, were dispatched on three-to-five day stints on outdoor pursuits courses. This was seen as a necessary part of their induction training.

Venture Pressings aimed to distance itself from the rigid working practices and the us-and-them culture that had caused so much strife in the motor industry. It introduced a single union and single-status agreements. All staff had the same conditions on sick pay, pensions and holidays.

Few of the original 300 staff, except for those at managerial level, had previous experience in the motor industry. Almost all came from within 10 miles of Telford.

Yesterday Keith Chambers, VP's director and general manager, said: 'Jaguar emphasised that while VP has been an excellent supplier over the three-and-a-half years of its operation, the commercial benefits to Jaguar of resourcing to Halewood are overwhelming.' He said that the decision nevertheless is a serious blow, which must lead to the closure of the VP factory.

GKN said the decision would not have an adverse financial impact on the group. It is believed that the joint venture partners are still discussing who should bear the cost of closing the company.

At the Ford Halewood plant, near Liverpool, employees were told that Jaguar's move was a vote of confidence in the plant's quality and reliability. John Fleming, operations manager at Halewood, said that the business transferred to Halewood would help to protect 900 jobs on Merseyside.

The need for Jaguar to drive down costs was highlighted last month, when Ford said it would inject another pounds 300m of equity into the luxury car maker. The US group bought Jaguar for pounds 1.56bn in 1990, and has recapitalised it in each of three successive years, in the face of continued losses.

Jaguar made a loss before tax of pounds 189.5m last year, but cut the first-half loss this year to pounds 77.2m from pounds 88.3m a year earlier.