Toyota cutting production and pay

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The Independent Online

Japanese car giant Toyota today announced cuts in production and pay at its two UK factories in another sign of the crisis facing the motor industry.

The cuts will start next month at the sites in Burnaston, near Derby and Deeside in North Wales and last for a year.

The company, which employs 3,900 workers at its main production site in Burnaston and 570 at its engine plant in Deeside, has already cut 200 temporary jobs and opened a voluntary redundancy scheme last week.

A statement said: "Following extensive consultation with our employee representatives, and with input from all employees, it has been agreed that the best way to secure long term employment is to temporarily reduce working hours and base pay by 10 per cent.

"This work share arrangement will take effect from 1st April and will be in place for one year, during this time we will continue to monitor the market and company situation closely.

"We believe the measures we have announced give us a greater opportunity to maintain employment through this difficult period."

The announcement was made as car company officials, bankers and union leaders were arriving at the London headquarters of the Business Department to discuss the Government's assistance programme for the industry, originally announced by Business Secretary Lord Mandelson in January.

Peter Tsouvallaris, a Unite representative at Toyota, said: "Our members are reminded daily of the tremendous insecurity this recession has brought to our industry.

"The proposals put to the workforce today present a real opportunity to restore some measure of stability to Toyota in the coming months, and we will be recommending them to our members.

"Unite's priority is to secure jobs and give our members a fighting chance of coming through this economic turmoil with their jobs and livelihoods intact.

"Any decision to cut wages and working time is never taken lightly but the agreement we have reached with Toyota will ensure none of our members' benefits are eroded and that these skilled workers will remain in place and at work ready for when the upturn comes.

"Once again, workers in the car industry are demonstrating that they will sacrifice in the short-term to ensure that they, their friends and colleagues can have a future in the years to come."

The Toyota workers are the latest in the motor industry to face cuts in pay and hours as a result of the slump in car sales.

Leading car firms in the UK have been cutting back on production, freezing pay, axing thousands of jobs and have had to stockpile thousands of vehicles in the face of a slump in sales in this country and across Europe.

Firms which supply parts and other goods to car companies have also been hit and face a grim future unless the outlook improves.

Workers at Jaguar Land Rover recently voted to accept a pay freeze and a shorter working week in return for a guarantee of no compulsory redundancies, while jobs have been cut at firms including Ford, Mini and Nissan.

No vehicles have been built at vanmaker LDV in Birmingham since before Christmas as a management buyout is attempted.

Toyota has also scrapped the annual pay increase for employees and cancelled management bonuses, while its UK factories have just finished a fortnight's shutdown. The new cuts are in addition to these measures.

The plant in Burnaston makes the Avensis and Auris models, with 85% of output exported. The firm's European sales were down by 10 per cent last year.