Leyland DAF loses more than 1,600 jobs

AN AIR of bitter resignation descended over Leyland DAF's UK plants last night as the receivers announced more than 1,600 job losses and failed once again to restart production because of a shortage of key supplies.

Details of the job losses, which will cut the 5,500-strong workforce by 30 per cent, are due to be released today, along with the results of a ballot on strike action in protest at the redundancies.

In a letter to all employees, Murdoch McKillop of Arthur Andersen, one of the joint administrative receivers, warned: 'Let me be clear, if there is strike action then all 5,500 jobs with Leyland DAF will most likely be lost with a knock-on effect to suppliers. The only future for Leyland DAF is a slimmed-down operation.'

Although the redundancies are likely to hit all of DAF's five British plants, the worst-affected are likely to be the Leyland truck factory in Lancashire and the Birmingham van plant.

Leyland DAF employs 2,500 at the Leyland trucks factory, 2,000 at Birmingham, 500 at the Albion axle works in Glasgow, 450 at a parts depot at Chorley, Lancashire, and 350 at its sales and marketing division at Thame, Oxfordshire. Unions fear that the job cuts are the first in a wave of UK redundancies. Half the 6,500 workers at DAF's truck and component plants at Eindhoven and Westerlo in Flanders also face the axe following the company's collapse.

During talks with their Dutch opposite numbers yesterday, British union leaders were told that the 3,300 DAF workers losing their jobs in the Netherlands and Belgium would receive a state redundancy package guaranteeing them 70 per cent of their wages for the next four years.

Jack Adams, deputy general secretary of the Transport and General Workers Union, said: 'Our workers face dismissal with no redundancy. It is disgraceful. Workers with a lifetime's service at the company will have to accept the minimum redundancy pay from the state.'

Mr McKillop said there was no alternative to job losses since Leyland DAF was unable to pay its bills or the weekly wages of all employees. He added that suppliers had already had to accept that outstanding debts were unlikely to be repaid. If there was no future Leyland DAF business, then many of the suppliers might also fail.

Mr McKillop earlier said some key suppliers were unwilling to support Leyland DAF by meeting orders even though they had been told they would be paid for deliveries since the receivers moved in. George Galloway, Labour MP for Glasgow Hillhead, which includes the Albion plant, said: 'These companies are cutting the throat of a vital British industry.'

GKN, which has stopped supplying axles and prop shafts, said last night: 'If the receiver comes to us with an order that is assured we will resume supplies.' Cummins, which supplies engines for Leyland DAF's truck range, said: 'It is completely inaccurate to say that the company has refused to deliver engines.'

The company's first contact with the receivers was on Tuesday morning, following which it held a meeting on Wednesday to sort out details of supply. 'Arising from that meeting we have confirmed that we will supply engines to the receivers depending on their ability to accept supplies,' it said.